REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 3703 OF 2003

Girnar Traders … Appellant

Versus

State of Maharashtra & Ors. … Respondents

WITH

CIVIL APPEAL NO. 292 OF 2011 (Arising out of SLP (C) No.9734 Of 2005)

Digambar Motiram Jhadhav          …Appellant

Versus

The Commissioner & Ors. …Respondents

J U D G M E N T

Swatanter Kumar, J.

Leave granted in SLP (C) No. 9734 of 2005.

IA Nos.4 and 5 of 2009 in Civil  Appeal No.3703 of 2003 are  

allowed subject to just exceptions and limited to this reference.

Legalistic  federalism  was  introduced  as  a  technique  of  

governance with  the people of India adopting,  enacting and giving

unto themselves the Constitution of India on 26th November, 1949.  

The legislative competence of the Central and State Legislatures has  

been demarcated by the Constitution under Article 246, with the fields  

for exercise of legislative power enumerated in List I (Central List),  

List II (State List) and List III (Concurrent List) of Schedule VII to the  

Constitution of  India.   Power to  enact  laws,  thus,  is  vested in  the  

Parliament as well as in the State Legislative Assemblies within their  

respective spheres.  This is the paramount source for enactment of  

law,  i.e.,  direct  exercise  of  legislative  power  by  the  respective  

constituents.   On  the  issue  of  distribution  of  powers  between  the  

Centre  and  the  State,  a  Constitution  Bench  of  this  Court  in  

Federation of  Hotel  & Restaurant  Association of  India v.  Union of  

India [(1989) 3 SCC 634], noticed that the constitutionality of a law  

becomes  essentially  a  question  of  power  which,  in  a  federal  

constitution,  turns  upon  the  construction  of  the  entries  in  the  

legislative  lists.  Interpretative  process,  as  a  tool  of  interpretation,  

introduced  new  dimensions  to  the  expansion  of  law  enacted  by  

Legislature, through Judge made law. Amongst others, doctrines of  

‘legislation  by  reference’  and  ‘legislation  by  incorporation’  are  the  

creation of judicial pronouncements.  One of the earliest instances,  

2

where the Privy Council, then responsible for Indian Judicial system,  

accepted the plea of ‘legislation by incorporation’ and interpreted the  

statute  accordingly  in  the  case  of  Secretary  of  State  for  India  in   

Council v. Hindusthan Co-operative Insurance Society Ltd. [AIR 1931  

PC  149].   This  judicial  pronouncement  was  followed  in  different  

subsequent judgments and these doctrines were analyzed in greater  

depth for bringing out the distinction between them.  The judgment of  

the Privy Council was referred with approval by this Court in different  

judgments including Municipal Commissioner of Howrah v.  Shalimar  

Wood  Products [(1963)  1  SCR  47];  Bolani  Ores  Ltd. v.  State  of  

Orissa [(1974) 2 SCC 777];  Mahindra & Mahindra v.  Union of India  

[(1979) 2 SCC 529];  Ujagar Prints v.  Union of India [(1989) 3 SCC  

488]; U.P. Avas Evam Vikas Parishad v. Jainul Islam [(1998) 2 SCC  

467];  Nagpur Improvement Trust v.  Vasant Rao [(2002) 7 SCC 657]  

and  Maharashtra  State  Road  Transport  Corporation v.  State  of  

Maharashtra [(2003) 4 SCC 200].  The principle that was enunciated  

by  the  Privy  Council  in  the  case  of  Hindusthan  Co-operative  

Insurance Society Ltd. (supra) stated, “where certain provisions from  

an existing Act  have been incorporated into a subsequent Act,  no  

addition to the former Act, which is not expressly made applicable to  

3

the subsequent Act, can be deemed to be incorporated in it,  at all  

events,  if  it  is  possible  for  the  subsequent  to  function  effectually  

without the addition”.  Though this principle has been reiterated from  

time to time; with the development of law, still  certain doubts were  

reflected  in  the  judicial  pronouncements  of  the  courts  as  to  the  

application of this principle as an absolute proposition of law.  On the  

contrary, this principle received criticism from various quarters.  The  

critics said that it was causing impediments in smooth operation of  

the  later  law  as  well  as  abdication  of  legislative  power  by  the  

concerned  legislative  constituent.   Another  criticism and  argument  

which, in fact, was even advanced before us is that while approving  

the principle stated by the Privy Council,  the subsequent Benches  

have not taken into consideration the impact of the judgment of the  

Constitution Bench of this Court in B. Shama Rao v. Union Territory  

of Pondicherry [(1967) 2 SCR 650]. A pertinent constitutional aspect  

that ought to have been brought to the notice of different Benches  

was that the federal structure of the Constitution had come into force  

which  controlled  governance  of  the  country  and  therefore  the  

principles, inter alia, stated by the Privy Council could not be adopted  

as  law of  universal  application  without  appropriately  modifying  the  

4

stated  position  of  law  to  bring  it  in  complete  harmony  with  the  

constitutional mandate.  In the case of Gauri Shankar Gaur v.  State  

of U.P. [(1994) 1 SCC 92], one member of the Bench of this Court,  

relied upon the principle stated in Hindusthan Co-operative Insurance  

Society  Ltd. (supra)  and  held  that  in  a  case  of  legislation  by  

incorporation, subsequent amendment or repeal of the provisions of  

an earlier Act adopted cannot be deemed to have been incorporated  

in the adopting Act which may be true in the case of legislation by  

reference.  This judgment was relied upon by another Bench of this  

Court  in the case of  State of Maharashtra v.  Sant Joginder Singh  

Kishan Singh [1995 Supp.(2) SCC 475].  The amendments in various  

relevant laws and introduction and application of newly enunciated  

principles of law resulted in varied opinions.  A Bench of this Court in  

the case of  Girnar Traders v.  State of Maharashtra [(2004) 8 SCC  

505] (hereinafter referred to as ‘Girnar Traders-I) expressed certain  

doubts  on  the  correctness  of  the  law  stated  in  the  case  of  Sant  

Joginder Singh (supra) and referred the matter to a larger Bench.  

The Bench in Girnar Traders-I (supra) felt that there were good  

reasons for reading the provisions introduced by the Land Acquisition  

(Amendment) Act, 1984 (hereinafter referred to as the ‘Central Act 68  

5

of  1984’)  into  Chapter  VII  of  the Maharashtra  Regional  and Town  

Planning Act,1966 (for short, ‘the MRTP Act’ or ‘the State Act’) and  

Section 11A of the Land Acquisition Act, 1894 (for short, ‘the Land  

Acquisition Act’ or ‘the Central Act’) is one of such provisions.  Thus,  

the Constitution Bench is called upon to examine whether the MRTP  

Act is a self-contained Code or not, if so, to what effect?  Further,  

whether, in any event, all the provisions of the Land Acquisition Act,  

as amended by Central Act 68 of 1984 with emphasis on Section 11A  

can be read into the provisions of the MRTP Act?

The above questions require examination in light of  the facts  

which,  to  some  extent,  have  been  referred  to  in  the  Order  of  

Reference dated 14th October, 2004 which reads as under:

“This appeal is directed against the judgment  of  the  Division  Bench  of  the  High  Court  of  Judicature  at  Bombay,  Aurangabad  Bench,  dismissing  the  writ  petition  of  the  appellant  under  Article  226  of  the  Constitution.  The  question for consideration is: whether all  the  provisions of  the Land Acquisition Act,  1894  as amended by Central Act 68 of 1984 can be  read into the provisions under Chapter VII of  the Maharashtra Regional and Town Planning  Act, 1966 for an acquisition thereunder.

The appellant is a registered partnership firm  owning  certain  lands  situated  within  the  

6

jurisdiction of the second respondent Jalgaon  Municipal  Council.  The  land  owned  by  the  appellant was subject to a reservation in the  draft development plan of Jalgaon town, which  was  published  on  19-3-1987.  Since  the  appellant  was  unable  to  develop  the  land  under  reservation,  and no steps were being  taken  by  the  Jalgaon  Municipal  Council  to  acquire the said land under the provisions of  the Maharashtra Regional and Town Planning  Act,  1966  (hereinafter  referred  to  as  “the  MRTP  Act”),  the  appellant  issued  a  notice  dated  19-1-1989 under  Section  49(1)  of  the  MRTP Act, calling upon the State Government  to either confirm or refuse the purchase notice  within the period fixed under Section 49 of the  MRTP Act.

On 25-7-1989 the State  Government,  acting  under  Section  49(4)  of  the  MRTP  Act,  confirmed the purchase notice issued by the  appellant.  Despite  confirmation  of  the  purchase  notice,  the  second  respondent  Jalgaon  Municipal  Council  did  not  take  any  steps under Section 126 of the MRTP Act, nor  did  it  apply  to  the  State  Government  for  acquisition of the land under reservation.

Ultimately, on 3-10-1991, the first respondent  State Government issued a notification under  Section  126(4)  of  the  MRTP  Act  read  with  Section 6 of the Land Acquisition Act, 1894,  declaring  that  the  land  concerned  was  required for a public purpose as indicated in  the  notification.  This  notification  expressly  mentions  that  the  period  of  three  years  prescribed under Section 126(2) of the MRTP  Act  was  over  and,  therefore,  the  State  Government was acting under sub-section (4)  of Section 126 of the MRTP Act.  

7

It  is the case of the appellant that it  had no  knowledge of this declaration dated 3-10-1991  as no individual notice has been served on it,  though this declaration was published in the  Official  Gazette  on  15-10-1991.  Despite  the  declaration under Section 126(4) of the MRTP  Act, as aforesaid, nothing happened till March  1994.  On  23-3-1994  the  appellant  issued  second purchase notice under Section 49(1)  of the MRTP Act. By a reply dated 10-4-1995,  the State Government informed the appellant  that inasmuch as the earlier purchase notice  dated 19-1-1989 had already been confirmed  by the State Government on 25-7-1989, and  further  since  the  Jalgaon  Municipal  Council  has  already  initiated  proceedings  for  acquisition of the land, the second purchase  notice was rejected.

The appellant challenged the said rejection by  his Writ Petition No. 2829 of 1996 before the  High Court of Judicature at Bombay. This writ  petition was disposed of by the High Court by  its  judgment  and  order  dated  31-3-1997  by  which  the  State  Government  and  the  Municipal Council were directed to initiate the  proceedings  for  acquisition  of  the  lands  in  question  within  one  year  and  complete  the  same  within  the  time  prescribed  under  the  MRTP Act. The High Court further directed, “in  case  the  authorities  fail  to  initiate  the  acquisition proceedings within the prescribed  period,  the  lands  of  the  petitioners  shall  be  deemed  to  have  been  released  from  the  reservation”.

According to the appellant, despite the order  of the High Court, it was not informed about  any steps taken by the authorities concerned  for acquisition of its land. On 13-4-1998, the  

8

appellant issued a letter to the Special Land  Acquisition  Officer,  Respondent  3,  calling  upon him to disclose whether any proceedings  had  been  initiated  for  acquisition.  The  appellant, however, received no reply.

On 18-2-1999, Respondent 3 issued a notice  to  the  appellant  under  Section  12(2)  of  the  Land Acquisition Act, 1894 calling upon him to  accept the compensation for the land acquired  as per the award. The appellant moved Writ  Petition No. 822 of 2000 in the High Court of  Judicature at Bombay and sought quashing of  the  notice  under  Section  12(2)  of  the  Land  Acquisition Act, 1894 and a direction enabling  it  to develop its land for residential  purpose.  By  the  impugned  judgment,  the  High  Court  dismissed the writ petition by holding that the  prayer for declaration of dereservation of the  subject land as well as granting of permission  to develop the property for residential purpose  had already been declined by its earlier order  dated 31-3-1997, which had become final as  far as the appellant was concerned. The High  Court thus took the view, “the only issue we  are required to examine i.e. whether the Land  Acquisition  Officer  has  complied  with  our  directions  and  if  the  directions  were  not  complied within the period of one year, as set  out by us, whether the petitioner is entitled for  the  reliefs  prayed  for  in  this  petition”.   The  High Court held: “on perusal of the documents  submitted before us we are satisfied that the  requisite  steps  have  been  taken  by  the  Special Land Acquisition Officer for acquisition  of the subject land and after Writ Petition No.  2829 of 1996 was disposed of, there was no  necessity  to  initiate  fresh  action  by  the  Planning  Authority  as  contemplated  under  

9

Section 126(1)(c) of the MRTP Act”.  In this  view of the matter, the writ petition came to be  dismissed.  Hence,  this  appeal  by  special  leave.

Mr V.A. Mohta, learned Senior Counsel for the  appellant urged that the scheme of the MRTP  Act  shows that,  on receipt  of  an application  under  sub-section  (1)  of  Section  126,  if  the  State  Government  is  satisfied  that  the  land  specified  in  the  application  is  required  for  a  public purpose, it may make a declaration to  that  effect  in  the  Official  Gazette  in  the  manner specified in the Land Acquisition Act,  1894, and such declaration is deemed to be a  declaration duly made under Section 6 of the  Land  Acquisition  Act,  1894.  The  proviso  to  sub-section (2) of this section prescribes the  period within which such declaration has to be  made. Sub-section (3) of this section provides  that  on  publication  of  the  declaration  under  Section 6 of the Land Acquisition Act, 1894,  the Collector  shall  proceed to take order for  the acquisition of the land under the said Act,  and  thereafter,  the  provisions  of  the  Land  Acquisition  Act,  1894  shall  apply  to  the  acquisition  of  the  said  land,  subject  to  the  modification  introduced  by  sub-section  (3),  which pertains only to the market value of the  land. The only change made in the scheme of  this Act is that, if the State Government fails to  make  the  declaration  under  sub-section  (2)  within the time provided in the proviso thereto,  the declaration does not become bad as it is  saved by sub-section (4).  Under sub-section  (4), notwithstanding the fact that the requisite  declaration  under  sub-section  (2)  had  not  been made within the time provided therein,  the State Government is empowered to issue  

10

a fresh declaration for acquiring the land in the  manner provided by sub-sections (2) and (3)  of Section 126 of the MRTP Act, but, if that be  done,  the  market  value  of  the  land  for  the  purpose of compensation shall be the market  value  at  the  date  of  such  declaration  made  afresh.

Mr.  Mohta  submitted  that  barring  the  above  special modification introduced in the scheme  of acquisition of land, in all other respects, the  provisions of  the Land Acquisition Act,  1894  would  mutatis  mutandis apply  to  an  acquisition  under  Chapter  VII  of  the  MRTP  Act.  He  pointed  out  that  the  MRTP  Act  contains neither any provision for payment of  compensation, nor does it prescribe the time  within which the award has to be made after a  declaration  is  made  under  sub-sections  (2),  (3) or (4) of Section 126. It is urged that the  legislature  could  not  have  left  it  vague  and  indefinite.  In  the  submission  of  the  learned  counsel, this is a situation of invocation of the  provisions of the Land Acquisition Act, 1894,  not by incorporation, but by reference. In other  words,  as  and  when  the  provisions  of  the  Land Acquisition Act, 1894 are amended, all  the amended provisions would be attracted to  an acquisition under Chapter VII of the MRTP  Act,  unless  barred  expressly  or  by  direct  implication.  The  amendments  introduced  in  the Land Acquisition Act, 1894 by Central Act  68  of  1984  would  all  automatically  apply.  Consequently,  the  period  of  limitation  prescribed under Section 11-A for making the  award would squarely apply.

Appellant urges that while sub-section (4) of  Section  126  may  save  a  declaration  under  Section 6 of  the Land Acquisition Act,  1894  

11

from becoming bad because of lapse of time  (though,  subject  to  the  modification  with  regard  to  the  market  value  of  the  land  prescribed  therein),  there  is  nothing  in  the  MRTP Act  which precludes,  expressly  or  by  direct  implication,  the  provisions  of  Section  11-A from applying to govern the period within  which the award has to be made. In the facts  of the present case, there is no dispute that  the  declaration  under  Section  126(4)  was  made  on  3-10-1991  and  published  in  the  Official  Gazette  on  15-10-1991,  while  the  award is  said  to  have  been made on  18-2- 1999. In these circumstances, the award not  having  been  made  within  the  period  of  two  years from the date of the declaration under  Section  6,  the  entire  proceedings  for  the  acquisition of the land would lapse by reason  of Section 11-A of the Land Acquisition Act,  1894.

Appellant  relies  heavily  on the Statement  of  Objects  and  Reasons  attached  to  the  Bill  preceding Act 68 of 1984. The attention of the  legislature was drawn to the fact of pendency  of acquisition proceedings for long time and,  “the pendency of acquisition proceedings for  long  periods  often  causes  hardship  to  the  affected  parties  and  renders  unrealistic  the  scale of compensation offered to them”.

Finally,  it  is contended that the amendments  introduced by Central  Act  68 of  1984 in the  Land Acquisition Act, 1894 were by way of a  composite  package  and  it  is  not  open  to  anyone  to  pick  and  choose  them  in  their  application,  unless  so  provided  in  any  competent  legislative  enactment.  In  the  present  case,  there  is  nothing  in  the  provisions of the MRTP Act which could oust  

12

the  application  of  the  entire  gamut  of  amendments introduced by Central Act 68 of  1984  and,  therefore,  all  acquisitions,  even  under the MRTP Act, must be read subject to  them.

Learned counsel for the respondents, refuting  the  contentions  urged  on  behalf  of  the  appellant,  placed  heavy  reliance  upon  the  judgment of a Bench of two learned Judges in  State of Maharashtra v.  Sant Joginder Singh  Kishan  Singh1.  Learned  counsel  for  the  respondents strongly urged that this judgment  clinches the arguments against the appellant.  The  same  contention  as  urged  by  the  appellant before us has been considered and  negatived  in  Sant  Joginder  Singh  (supra)  wherein it is observed (vide para 13) as under:

“It  is  next  contended  that  since  no  separate  procedure  was  prescribed  by  the  Act  for  determining  the  compensation,  by necessary inference,  the  Central  Act  was  intended  to  be  applied  mutatis  mutandis  to  the  acquisition  under  the  Act.  He  seeks  support  from  the  award  made  by  the  Collector  in  that  behalf.  It  is  true  that  there is no express provision under the  Act  to  determine compensation for  the  land acquired under the Act. Therefore,  by necessary implication, compensation  needs to be determined by applying the  principles  in  Section  23  of  the  Central  Act.  But, there is a distinction between  procedural and substantive provisions of  a  statute.  Determination  of  compensation  by  applying  appropriate  principles  is  relatable  to  substantive  

1 1995 Supp (2) SCC 475

13

provision,  whereas  making  of  award  within  a  prescribed  period  is  basically  procedural. So, merely because Section  23  of  the  Central  Act  would  apply  to  acquisition  under  the  Act,  it  is  not  enough to hold that what is contained in  Section 11-A would also apply. Further,  what  has been provided in sub-section  (4) of Section 126 of the Act is a clear  indication that failure to make the award  within  two  years  from  the  date  of  the  declaration  under  sub-section  (2)  of  Section 126 of the Act, would not render  the notification published under Section  125 of the Act non est.”

The appellant urges that Sant Joginder Singh  (supra)  needs  reconsideration  by  a  larger  Bench.

Upon careful consideration of the contentions  urged before us, we are inclined to accept the  submissions of Mr. Mohta for more than one  reason.  First,  although  the  MRTP  Act  and  similar Regional Town Planning Acts did not  contain  specific  provisions  for  payment  of  compensation, when they were challenged as  infringing Article 14 of  the Constitution,  their  validity was upheld by reading the provisions  as to payment of compensation contained in  the  Land  Acquisition  Act,  1894  into  the  Regional  Town  Planning  Acts.  (See  in  this  connection  Gauri  Shankar  Gaur v.  State  of  U.P.2 and Nagpur Improvement Trust v. Vithal  Rao3)

Secondly,  Sant  Joginder  Singh  (supra)  appears to have been doubted by a judgment  

2 (1994) 1 SCC 92 3 (1973) 1 SCC 500 Paragraphs 30 and 31

14

of  another  Bench  of  two  learned  Judges  in  Maharashtra SRTC v.  State of Maharashtra4.  This was a case under the provisions of the  same  Act  viz.  MRTP  Act,  1966.  After  considering the judgments in U.P. Avas Evam  Vikas  Parishad v.  Jainul  Islam5 and  Nagpur  Improvement Trust (supra) it was held that the  provisions with regard to compensation made  by Central Act 68 of 1984, by addition of sub- section (1-A) to Section 23 and the increased  amount of solatium under Section 23(2) and  the interest  payable under Section 28 would  all apply to an acquisition under Chapter VII of  the  MRTP  Act.  Dealing  with  Sant  Joginder  Singh (supra) the Division Bench of this Court  explained  away  Sant  Joginder  Singh by  observing :

“The  ultimate  conclusion  in  Sant  Joginder Singh case1 seems to rest on  the ratio that there is sufficient indicia in  the  MRTP  Act  itself  to  exclude  the  applicability  of  Section  11-A  of  the  LA  Act in view of sub-sections (2) and (4) of  Section 126. As we are approaching the  question  of  correct  interpretation  of  Section  126(3)  from  a  different  perspective,  there  is  no  need  to  enter  into a further discussion as to whether  and  to  what  extent  support  can  be  drawn from this decision.”

Reading the judgment in  Maharashtra SRTC  (supra) it  appears  to  us  that,  the  Division  Bench in that case did not seem to agree with  the  proposition  that  was  laid  down  in  Sant  Joginder Singh (supra).

4 (2003) 4 SCC 200 5 (1998) 2 SCC 467

15

There appears to be no good reason to shut  out  or  preclude  the  amendments  introduced  by  Central  Act  68  of  1984  in  the  Land  Acquisition  Act,  1894  from  applying  to  an  acquisition  under  Chapter  VII  of  the  MRTP  Act. Or else, the consequence would be that,  in respect of two landholders there would be  arbitrary  discrimination  in  the  matter  of  acquisition of their  lands,  merely because in  one case the acquisition is by the direct route  of  the  Land  Acquisition  Act,  1894  and,  in  another case, through the indirect route of the  MRTP Act. The vice of discrimination pointed  out  by a Bench of  seven learned Judges in  Nagpur Improvement Trust (supra) (vide para  31) would affect such a situation. In order to  avoid  such  a  situation,  and  to  save  the  constitutionality of the provisions of the MRTP  Act,  the  provisions  of  enhanced  benefits  introduced  by  Central  Act  68  of  1984  were  read into the provisions of the MRTP Act, and  an acquisition under the MRTP Act was held  to be governed by the same provisions. The  same principle should apply in the matter of  attracting the provisions of Section 11-A of Act  68 of 1984 also to the acquisition under the  MRTP Act.

Thirdly, if the provisions of the MRTP Act are  read as contended by the learned counsel for  the respondents, in the light of  Sant Joginder  Singh (supra)  then  it  would  be  open  to  the  authorities,  after  issuing a  declaration  under  sub-section  (3),  to  go  into  hibernation  and  leave the matter  hanging in  perpetuity.  That  certainly  would  seriously  affect  the  rights  of  the landholder preventing him from developing  the land or alienating it,  merely because the  authority chooses to act under one Act instead  

16

of  the  other.  This  again,  would  attract  the  wrath of Article 14 of the Constitution, not only  on  account  of  discrimination,  but  also  on  account of arbitrariness.

We, therefore, see no good reason as to why  the  provisions  introduced  in  the  Land  Acquisition  Act,  1894  by  Central  Act  68  of  1984 should not  be read into  an acquisition  under  Chapter  VII  of  the  MRTP Act,  to  the  extent not precluded by the MRTP Act, 1966.  Section 11-A being one such section, it may  have  to  be  applied  to  the  acquisition  under  Chapter VII of the MRTP Act.

For these reasons, in our considered view, the  decision  in  Sant  Joginder  Singh (supra)  requires reconsideration by a larger Bench.

The Registry is directed to place the papers  before the Hon’ble Chief  Justice of  India for  appropriate directions in the matter.”

At the cost of repetition and also keeping in mind that certain  

important  facts  do  not  emerge  in  entirety  from  the  Order  of  

Reference,  we will  prefer  to  refer  some of  the essential  additional  

facts  as  they  appear  from the  record  and,  particularly,  from  the  

impugned judgment.  Draft Development Plan was published on 19th  

March,  1987  and  the  lands  of  the  appellant  were  reserved  for  a  

school and playground.  On 19th January, 1989, the appellant served  

purchase  notice  under  Section  49  of  the  MRTP  Act  which  was  

17

confirmed on 25th July, 1989.  The Planning Authority requested the  

Collector to initiate steps for acquisition of the land in question on 18th  

November,  1989  in  furtherance  to  which  the  Collector,  Jalgaon  

appointed  Special  Land  Acquisition  Officer  (LAO)  to  initiate  

proceedings for acquiring reserved lands in the Development Plan.  

However,  the  Planning  Authority  passed  a  resolution  (No.736)  

recommending de-reservation of appellant’s land but no further steps  

in  accordance  with  law  were  taken  and,  on  the  contrary,  on  3rd  

October, 1991, declaration under Section 126(2) of the MRTP Act in  

the manner specified under Section 6 of the Land Acquisition Act was  

issued along with notices under Section 9 of that Act, which had been  

denied by the appellant.  It is alleged that this resolution was passed  

in collusion with the appellants.  The State Government sanctioned  

the Draft  Development  Plan on 6th January,  1993 and draft  award  

was prepared by the LAO on 20th July, 1993.  The application dated  

19th March, 1994 for developing the land, filed by the appellant under  

Section 44 of the MRTP Act, was turned down by the Municipality.  

The appellant served the second purchase notice under Section 49 of  

the MRTP Act  which was  also  turned down vide order  dated 10th  

April, 1995. It may be noticed that the communication dated 10th April,  

18

1995 was challenged by the appellant before the High Court by filing  

a  writ  petition  being  CWP No.2829  of  1996.   In  this  petition,  the  

appellant had prayed for quashing of the communication dated 10th  

April, 1995 and declaring that the appellant’s land would be deemed  

to have been released from the reservation.  The Court, vide its order  

dated  31st March,  1997,  rejected  all  the  prayers  and  directed  as  

under:

“The respondents No.1 and 3 are directed to  initiate the proceedings for acquisition of the  lands in question within one year from today  and  complete  the  same  within  the  time  prescribed  under  the  Act.   In  case  the  authorities  fail  to  initiate  the  acquisition  proceedings within the prescribed period, the  lands  of  the  petitioner  shall  be  deemed  to  have  been  released  from  the  reservation.  Petition is disposed of accordingly.”

Final award was passed by the LAO on 10th February, 1999 and  

he  issued  notices  to  the  parties  under  Section  12(2)  of  the  Land  

Acquisition Act on 18th February, 1999.  The appellant approached  

the High Court  of  Bombay,  again,  by filing Writ  Petition No.822 of  

2000 in which the basic challenge to the action of the respondent was  

on the ground that the concerned authorities including the Planning  

Authority had failed to take steps for acquisition in terms of the order  

19

of the Court dated 31st March, 1997 within one year and, thus, the  

reservation had lapsed.  The land of the appellant, thus, should be  

deemed to have reverted to the appellant and he should be at liberty  

to  develop  the  said  land  free  from  any  encumbrance.   The  writ  

petition came to be dismissed summarily by the High Court vide order  

dated 29th March,  2000 which was challenged by filing  a Special  

Leave Petition which subsequently had been registered upon grant of  

leave as Civil Appeal No.3703 of 2003.  It has been noticed by the  

High Court  in the impugned judgment,  “Admittedly,  a notice under  

Section 127 of the MRTP Act has not been issued by the appellant to  

the Planning Authority at any time and, therefore, the reliance on the  

provisions of Section 127 of the MRTP Act is totally misplaced.  The  

appellant had issued the first purchase notice under Section 49 of the  

MRTP Act to the State Government on 19th January, 1989 and it was  

confirmed by the State Government under Section 49(4) of the MRTP  

Act on 25th July, 1989.”  This is not even disputed by the appellant  

before us.  

Another important fact which needs to be noticed by us is that  

the order dated 31st March, 1997 passed by the High Court in Writ  

20

Petition (C) No.2829 of 1996, was clarified in the impugned judgment  

by  stating  that  the  LAO  had  taken  steps  in  furtherance  to  his  

appointment by the Collector vide order dated 29th June, 1990 and  

had prepared the draft award on 20th July, 1993.  As these facts were  

not brought to the notice of the Court, the directions issued by the  

High  Court  certainly  did  not  mean  that  fresh  steps  for  acquisition  

should be taken.  In fact, the acquisition proceedings were expected  

to be completed by the LAO in furtherance to his appointment by the  

Collector  in  accordance  with  law.   Thus,  the  High  Court,  while  

referring to the second notice served by the appellant under Section  

49 of the MRTP Act, rejected all relief claimed by the appellant, as  

necessary steps had already been taken by the LAO.

The appellant  herein  had  argued in  Girnar  Traders-I (supra)  

that the decision of this Court in Sant Joginder Singh’s case (supra)  

needs reconsideration by a larger Bench as it did not state correct  

law whereas the respondent-State of Maharashtra had taken up the  

plea  that  Sant  Joginder  Singh’s  case  (supra) clinched  the  entire  

issue.  The Bench, while accepting the contentions raised on behalf  

of  the appellant,  stated three reasons for referring the matter  to a  

21

larger Bench.  As is evident from para 17 of the Order of Reference,  

the Bench noticed that Sant Joginder Singh’s case  (supra) appears  

to have been doubted by judgments of other Benches of this Court in  

the  cases  of  Maharashtra  SRTC,  Nagpur  Improvement  Trust and  

U.P. Avas Evam Vikas Parishad (supra) in which it was held that the  

provisions with regard to compensation in terms of Central Act 68 of  

1984, including Sections 23(1A), 23(2) and 28 of the Land Acquisition  

Act would be applicable to an acquisition under Chapter VII of the  

MRTP Act.  On the contrary, in Sant Joginder Singh’s case (supra),  

the Court had held that there are sufficient indicia in MRTP Act itself  

to exclude applicability of Section 11A of the Land Acquisition Act in  

view of sub-sections (2) and (4) of Section 126 of the MRTP Act.  The  

Bench  also  felt  that  voice  of  discrimination  pointed  by  the  Seven  

Judge  Bench  in  Nagpur  Improvement  Trust v.  Vithal  Rao [(1973)  

1SCC 500] would affect a situation like the present case and such  

provisions may have to be read into the Land Acquisition Act.  After  

expressing this view, the Bench chose to refer a restricted question  

for  determination  by  the  larger  Bench  that  whether  provisions  of  

Section 11A of the Land Acquisition Act, amongst other provisions,  

introduced by Central Act 68 of 1984 would, apply to Chapter VII of  

22

the MRTP Act.   

Before we answer this legal controversy arising in the present  

case, we consider it appropriate to refer to the contentions raised by  

the learned counsel appearing before us.

The appellant has challenged the findings recorded by the High  

Court in the impugned judgment on various grounds.  They have to  

be examined on merits by the appropriate Bench.  We are primarily  

concerned with answering the question referred to this Bench in the  

above Order of Reference.  In that regard, the contentions raised on  

behalf of the appellants are:

1. There is generic reference to the provisions of Land Acquisition  

Act  in  different  Chapters  of  the  MRTP  Act.   Hence,  the  

provisions of the Land Acquisition Act will have to be read into  

the provisions of MRTP Act as it is legislation by reference.  As  

a result thereto, all the provisions introduced by the amending  

Central  Act  68  of  1984,  including  Section  11A  of  the  Land  

Acquisition Act will be read into and become integral part of the  

MRTP Act.

23

2. The scheme under  both  the  Acts  is  complementary  to  each  

other.  Therefore, both the Acts have to operate in a common  

field and, then alone, it will form a unified workable scheme with  

due regard to dichotomy between reservation and acquisition.

3. In  terms  of  Section  125  of  the  MRTP  Act,  the  purpose  of  

acquisition shall be deemed to be a public purpose within the  

meaning of the Land Acquisition Act.  The provisions of Section  

126 of the MRTP Act require application of the provisions of the  

Land Acquisition Act. Once notification under Section 126(2) is  

issued, automatically the provisions of Section 6 and complete  

mechanism for acquisition of land under the provisions of the  

Land  Acquisition  Act  comes  into  operation  and,  thus,  the  

provisions of  Section 11A of  the  Land Acquisition  Act  would  

become part of such acquisition necessarily.

4. The provisions of the Central Act 68 of 1984 are procedural in  

their  nature and application and are not  substantive.   These  

provisions, therefore, would form part of the MRTP Act. Hence,  

the  judgment  of  this  Court  in  Sant  Joginder  Singh’s  case  

(supra) requires reconsideration.

24

5. The view taken by this Court in the case of Sant Joginder Singh  

(supra), following Hindusthan Co-operative Insurance Society’s  

case (supra),  applying  the  principle  of  legislation  by  

incorporation is not applicable to the present case and these  

judgments require reconsideration by this Court.

6. Lastly  and  in  alternative,  it  is  contended  that  any  other  

approach would vest the concerned authorities with the choice  

of initiating proceedings under either of these Acts which have  

substantially different consequences, in fact and in law.  It  is  

also argued that if Section 11A of the Land Acquisition Act is  

not read into or treated as part of the MRTP Act, then it  will  

amount to discrimination between the similarly situated persons  

whose lands are subject matter of acquisition.

Reacting  to  the  above  submissions,  the  learned  counsel  

appearing for different respondents contended that:

1. The MRTP Act is a self-contained Code in itself.  Consequently,  

it is not necessary for the Court to go into the larger question,  

whether it is a case of legislation by reference or legislation by  

incorporation.

25

2. In  the  alternative,  even if  the  Court  decides to  examine this  

aspect, it is a clear case of legislation by incorporation.  Various  

provisions of the MRTP Act have referred to specific provisions  

of the Land Acquisition Act and no general application of the  

provisions of  the Land Acquisition Act is contemplated under  

the  provisions  of  the  MRTP  Act.   Since  it  is  legislation  by  

incorporation, the amended provisions inserted by Central Act  

68 of 1984 cannot be read into the MRTP Act.  Both the laws  

are  wholly  dissimilar,  operate  in  different  fields  and  have  

different  objects.  The  Land  Acquisition  Act  is  a  Central  

legislation relatable to Entry 42 of List III while the MRTP Act is  

enacted by the State Legislature with reference to Entries 5 and  

18 of List II of Schedule VII to the Constitution.   

3. These being the legislations enacted by two different bodies for  

different  purposes  cannot  attract  any  of  the  aforestated  

principles.  Both the Acts operate in different fields and cannot  

be read together to create a coherent legislation as that would  

frustrate the very object of the legislation falling exclusively in  

the domain of the State Legislature.   

26

4. The State  enactment  has provided for  definite  time frame in  

regard  to  different  subjects,  except  for  making  of  the  award  

after a declaration in terms of Section 126(2) or 126(4) of the  

State Act as the case may be, which by necessary implication,  

would  mean  intended  exclusion  of  the  provisions  of  Section  

11A of the Central Act.

5. On following the principle stated by the Constitution Bench in  

the case of B. Shama Rao (supra), the other judgments of this  

Court cannot be stated as a binding precedent.  There shall be  

abdication of its constitutional functions by the State Legislature  

as it would not be aware of and able to apply its mind to the  

amendments made to the Central Legislation, if the principle of  

legislation by reference is applied to the present case.  It would  

lead to undesirable consequences.

SCHEME UNDER THE RESPECTIVE ACTS :

THE MAHARASHTRA REGIONAL & TOWN PLANNING ACT, 1966

The MRTP Act was enacted by the legislature of the State of  

Maharashtra as it was expedient to make provisions for the planning,  

development  and  use  of  the  land  in  regions  established  for  the  

purpose of that Act, for the constitution of Regional Planning Boards  

27

therefor  and  to  make  better  provisions  for  the  preparation  of  

development  plans  with  a  view  to  ensure  that  the  town  planning  

scheme  is  made  in  a  proper  manner  and  its  execution  is  made  

effective.  According to the statement of objects and reasons of this  

enactment, the Bombay Town Planning Act, 1954 had made planning  

of land possible only within the areas of local authorities and there  

was  no  provision  to  control  development  of  land  in  the  important  

peripheral  areas  outside  the   municipal  limits.   This  resulted  in  

development  of  land  in  the  peripheral  areas  in  an  irregular  and  

haphazard manner which was clearly demonstrated in the vast areas  

outside Greater Bombay, Poona and other important urban centres.  

The object of regional planning was to facilitate proper planning of  

such  extensive  areas  of  land,  called  Regions  in  the  Bill,  having  

common  physical,  social  and  economic  problems  so  that  certain  

matters such as distribution of population and industries, roads and  

highways,  preservation  of  good  agricultural  lands,  reservation  of  

green belts and preservation of areas of natural scenery etc. could be  

dealt with and planned comprehensively on a regional level.  The Bill  

had sought to improve the provisions of the Bombay Town Planning  

Act,  1954  in  regard  to  preparation  and  execution  of  development  

28

plans to ensure that such plans are made properly and expeditiously.  

Every planning Authority is required to appoint a Town Planner for  

carrying out surveys and to prepare an existing land use map and  

formulating proposals of the development plan within the framework  

of the Regional Plan, where one exists, for the consideration of the  

Planning Authority.   The Planning Authority is entitled to refuse or  

grant,  subject  to  certain  conditions,  permission  to  develop  in  

accordance with such plan.  This order of the Planning Authority is  

appealable before the Prescribed Officer in the State Government.  

Unauthorized development was made penal and could be removed  

and the use contrary to the plan could be discontinued.  One of the  

main features of the Bill was the provision for creation of new towns  

by means of Development Authorities. The problems of overcrowding  

of population and industries, traffic congestion, inadequacy of public  

services and utilities like schools, hospitals, markets, water supply,  

drainage and road, rail transport etc. became so acute in the regions  

of Greater Bombay and Poona that it became necessary to consider  

proposals  for  the  dispersal  of  population  and  industry  from  such  

centres and their  reallocation at  suitable places within  the Region.  

The  MRTP  Act  required  every  local  authority  to  prepare  a  

29

development plan for the area within its jurisdiction.  Under such plan,  

the  local  authority  was to  allocate  land for  different  uses,  e.g.  for  

residential,  industrial,  commercial  and  agricultural  and  to  reserve  

sites required for public purposes as well.  Town planning schemes  

could be made in respect of any land, whether open or built up and  

incremental  contribution,  i.e.  betterments  in  land  value  could  be  

recovered from owners of  the plots  benefitting  from the proposals  

made in the scheme.  These were the features of the Bombay Town  

Planning  Act,  1954  which  extended  to  whole  of  the  State  of  

Maharashtra  excluding  the  City  of  Nagpur  and,  thus,  a  more  

comprehensive  and  effective  legislation  was  contemplated  by  the  

legislature.

The scheme of the MRTP Act is, primarily, focused on planning  

and development of the land in the entire State of Maharashtra.  The  

MRTP Act provides for development plans from macro to micro level  

which includes specifying the land to be used for providing various  

public  amenities and services.  That  is the precise reason that  the  

expression ‘development’  under Section 2(7) of the MRTP Act has  

been defined in very wide terms.  It  is difficult  to comprehend any  

30

activity  relating  to  land  and  planning  which  could  fall  outside  the  

scope  of  this  definition.   Section  2(9)  of  the  State  Act  defines  

‘development plan’ to mean a plan for development or redevelopment  

of  the  area  within  the  jurisdiction  of  the  Planning  Authority  and  

includes revision of a development plan and proposals of a Special  

Planning Authority for development of land within its jurisdiction.  The  

‘regional plan’ means a plan for development or redevelopment of a  

region which is approved by the State Government and has come  

into operation under the MRTP Act.  The expression ‘town planning  

scheme’ has not been defined as such but the term ‘scheme’ includes  

a plan relating to town planning scheme in terms of Section 2(30) of  

the State Act.   Corresponding to each plan there are authorities like  

‘Development  Authority’  which  means  a  New  Town  Development  

Authority constituted or declared under Section 113 of the MRTP Act,  

‘Planning Authority’ which means a local authority including a Special  

Planning Authority and the Slum Rehabilitation Authority appointed  

under  Section 40 of  this  Act  and Section 3(c)  of  the Maharashtra  

Slum  Areas  Improvement  Clearance  &  Redevelopment  Act,  1971  

respectively.   ‘Region’  means  any  area  established  to  be  region  

under  Section  3,  ‘Regional  Board’  or  ‘Board’  means  Regional  

31

Planning  Board  constituted  under  Section  4,  ‘Regional  Planning  

Committee’  means  a  committee  constituted  under  Section  10.  

‘Development Rights’  in terms of Section 2(9A) means the right to  

carry out development or to develop the land or building or both and  

shall include the transferable development right in the form of right to  

utilize the Floor Space Index of land utilizable either on the remainder  

of the land partially reserved for a public purpose or elsewhere, as  

the  final  Development  Control  Regulations  in  this  behalf  provide.  

Once a region has been created under the provisions of the MRTP  

Act then a regional plan is to be prepared and it should provide for  

matters contemplated under Section 14.  This plan is to be submitted  

to the State Government for approval. The Regional Board, before  

preparing  common  regional  plan  and  submitting  it  to  the  State  

Government for approval, is required to carry out necessary surveys  

and prepare an existing land use map of the region or such other  

maps as are considered necessary and then prepare a draft regional  

plan.   It  shall  be  published  in  the  Official  Gazette  in  the  manner  

prescribed and shall  be open to inspection at all  reasonable hours  

mentioned  therein  inviting  objections  and  suggestions  from  any  

person with regard to draft plan before the specified date which is not  

32

to  be  earlier  than  four  months  from the  publication  of  the  notice.  

Then this plan has to be notified in accordance with the provisions of  

Section 17 of the MRTP Act.  It is important to note that once the draft  

regional plan or regional plan has been notified and published then  

Section 18 of the MRTP Act places a restriction on change of use of  

land or development thereof which reads as under:

“18. Restriction on change of user of land or  development hereof.

(1) No person shall on or [after the publication  of  the notice that  the draft  of  Regional  plan  has been prepared or the draft Regional plan  has been approved],  institute  or  change the  use of  any land for  any purpose other  than  agriculture, or carry out any development, in  respect  of  any  land  without  the  previous  permission  of  the  Municipal  Corporation  or  Municipal Council, within whose area the land  is situate, and elsewhere, of the Collector.

(2) Notwithstanding anything contained in any  law for the time being in force the permission  referred  to  in  sub-section  (1)  shall  not  be  granted otherwise than in conformity with the  provisions of the draft of final Regional plan.

(3) Without prejudice to the provisions of sub- sections (1) and (2) or any other provisions of  this  Act,  any  person  intending  to  execute  a  Special  Township  Project  on  any land,  may  make an application to the State Government  and on receipt  of  such application the State  Government  may,  after  making  such  inquiry  

33

as it may deem fit  in that behalf,  grant such  permission and declare such project to be a  Special Township Project by notification in the  Official Gazette or, reject the application”

Section 20 of the State Act empowers the State Government to  

revise or modify the regional plan in accordance with the prescribed  

procedure.   Chapter  III  of  the  MRTP  Act  deals  with  preparation,  

submission  and  sanction  of  Development  Plan  and,  primarily,  

provides for use of land for purposes such as residential, industrial,  

commercial,  agricultural,  recreational,  schools,  colleges  and  other  

educational institutions, open spaces, playgrounds, stadia, zoological  

gardens, green belts, nature reserves, transport and communication,  

water supply, drainage, sewerage amongst other public utilities and  

amenities. The Draft Development Plan is also to be submitted to the  

State Government in terms of Section 30 of the MRTP Act.  Chapter  

IV of  this  Act  contains certain  significant  provisions and relates to  

control of development and use of land included in the development  

plans.   Section 43 of  the MRTP Act  states that  after  the date on  

which, the declaration of intention to prepare a development plan for  

any area is published in the Official Gazette or after the date on which  

a notification specifying any undeveloped area as a notified area, or  

34

any area designated as a site for  a new town is  published in  the  

Official Gazette, no person shall institute or change the use of any  

land or carry out any development of land without the permission in  

writing of the Planning Authority. However, the proviso to this Section  

provides that no such permission shall be necessary for carrying out  

works for the maintenance, improvement or other alterations of any  

building  which   do  not  materially  affect  the  external  appearance  

thereof as specified in that Section.  Even in terms of Section 49 of  

the MRTP Act where a purchase notice is served, the person has to  

call  upon  the  authorities  to  purchase  his  interest  in  the  land  for  

reasons  contained  in  clauses  (a)  to  (e)  of  sub-section  (1)  and  in  

accordance with the provisions of this Act.

The Government/Appropriate Authority, other than the Planning  

Authority is vested with the powers under Section 50 of the MRTP Act  

to delete reserved or designated land from interim or draft  or final  

development plan and in terms of Section 68 of the MRTP Act, the  

State Government is also vested with the power to sanction even the  

draft  scheme.   Section  69  of  the  MRTP  contemplates  similar  

restrictions on the use and development of the land upon declaration  

35

of town planning scheme.  Town planning schemes are required to be  

prepared for the purposes of implementing the proposal in the official  

development plan in terms of the provisions of Chapter V of MRTP  

Act.   Another  aspect  which requires  consideration of  this  Court  is  

reference to Section 72 of the MRTP Act which refers that the matters  

in relation to such schemes to be adjudicated upon by the Arbitrator  

who has been vested with wide powers and duties.  The Arbitrator  

shall follow the procedure prescribed under Section 72(3), estimate  

the value and fix difference between the values of the original plots  

and the values of  the final  plots  included in  the final  scheme and  

estimate the amount of compensation payable under Section 66 of  

the MRTP Act, estimate the reference of claims made before him and  

decide  the  dispute  of  ownership  amongst  other  specified  matters.  

Appeal against the decision of the Arbitrator under clauses (iv) to (xi)  

(both inclusive) and clauses (xiv) to (xvi) of sub-section (3) of Section  

72 of the State Act lies to a tribunal constituted under Section 75 of  

the MRTP Act.  In fact, certain decisions of the Arbitrator are final and  

binding on the parties  including the Planning Authority.   However,  

some of such decisions do not attain finality qua filing of civil suits,  

e.g. disputes under Section 71 of the MRTP.  Thus, an adjudicatory  

36

mechanism  covering  larger  aspects  of  planning  and  execution  is  

provided  under  the  provisions  of  the  MRTP  Act.   Preparation,  

submission and sanction of development plans are basic functions of  

various authorities constituted under Chapter VI of the MRTP Act with  

ultimate  object  of  execution  of  such  plan.   The  MRTP  Act  

contemplates preparation, approval and finalization of an interim or  

draft plan and, as already noticed, with the publication of such plans,  

the restrictions operate.

We  may  also  notice  that  Section  14(e)  of  the  MRTP  Act  

contemplates  reservation of  sites for  new towns, industrial  estates  

and any other large scale development or project which is required to  

be undertaken for  proper development  of  the region or  new town.  

Section 113 of the State Act provides for designation of a site for a  

new town.

The most important facet of this legislation is the provisions with  

regard to acquisition and lapsing of reservation and powers of the  

Government  in  that  regard.   These  aspects  have  been dealt  with  

under Chapter VII of the MRTP Act.  Section 125 of the MRTP Act  

provides that any land required, reserved or designated in a Regional  

37

Plan,  Development  Plan  or  Town  Planning  Scheme  for  a  public  

purpose or purposes, including plans for any area of comprehensive  

development or for any new town shall be deemed to be land needed  

for a public purpose within the meaning of the Land Acquisition Act.  

Section 126 of the MRTP Act contemplates that after the publication  

of a draft Regional Plan, a Development Plan or any other plan or  

Town Planning Scheme, if any land is required or reserved for any of  

the public purposes specified in any plan or scheme under this Act at  

any time the Planning Authority,  Development  Authority,  or  as the  

case may be, any Appropriate Authority may,  except as otherwise  

provided in section 113A of the MRTP Act, acquire the land, in the  

mode specified in that Section. Section 126(2) of the MRTP Act also  

contemplates  that  where  an  application  has  been  moved  under  

Section  126(1)(c)  of  the  MRTP  Act  to  the  State  Government  for  

acquiring  such  land  under  the  Land  Acquisition  Act,  then  the  

Government is to act in accordance with and subject to the provisions  

of Section 126(2) of the MRTP Act.  If the State Government is of the  

opinion that any land included in such plan is needed for any public  

purpose,  it  may  make  a  declaration  to  that  effect  in  the  Official  

Gazette, in the manner provided in Section 6 of the Land Acquisition  

38

Act (emphasis supplied).  Such declaration, notwithstanding anything  

contained  in  the  Land  Acquisition  Act,  shall  be  deemed  to  be  a  

declaration duly made under that Section.  In other words, there is no  

requirement to comply with the provisions of Sections 4 and 5(A) of  

the Land Acquisition Act before such declaration is published. It  is  

further provided that subject to the provisions of Section 126(4) of the  

MRTP Act no such declaration shall be made after the expiry of one  

year  from  the  date  of  publication  of  the  draft  regional  plan,  

development plan or any other plan or the scheme, as the case may  

be.  After such declaration is published, the Collector shall proceed to  

take order for the acquisition of the land under the Land Acquisition  

Act and provisions of that Act shall apply to the acquisition of the said  

land with the modification that date of market value of the land to be  

acquired  shall  be  determined  with  reference  to  sub-section  3(i)  to  

3(iii) of Section 126 of the MRTP Act.  Sub-section (4) of Section 126  

empowers  the  State  Government  to  make  a  fresh  declaration  for  

acquiring the land where the period of one year, as specified in the  

proviso  to  sub-section  (2)  to  Section  126  of  the  MRTP  Act,  has  

lapsed but then the market value of the land would be the market  

value on the date of publication of fresh declaration.  Section 126 of  

39

the MRTP Act reads as under:

“126.  Acquisition  of  land  required  for  public  purposes specified in plans.

(1)  When  after  the  publication  of  a  draft  regional Plan, a Development or of land any  other plan or town planning scheme, any land  is required or  reserved for any of the public  purposes  specified  in  any  plan  or  scheme  under  this  Act  at  any  time  of  the  Planning  Authority,  Development  Authority,  or  as  the  case may be, any Appropriate Authority may,  except as otherwise provided in section 113A  acquire the land, -

(a)  by  agreement  by  paying  an  amount  agreed to, or

(b) in lieu of any such amount, by granting the  land-owner or the lessee, subject, however, to  the lessee-paying the lessor or depositing with  the Planning Authority, Development Authority  or Appropriate Authority, as the case may be,  for  payment  to  the  lessor,  an  amount  equivalent to the value of the lessor's interest  to  be  determined   by  any  of  the  said  Authorities  concerned  on  the  basis  of  the  principles  laid  down in  the  Land  Acquisition  Act,  1894,  Floor  Space  Index  (FSI)  or  Transferable  Development  Rights  (TDR)  against the area of land surrendered free of  cost and free from all encumbrances, and also  further  additional  Floor  Space  Index  or  Transferable Development Rights against the  development or construction of the amenity on  the surrendered land at his cost, as the Final  

40

Development Control Regulations prepared in  this behalf provide, or  

(c)  by  making  an  application  to  the  State  Government for acquiring such land under the  Land  Acquisition  Act,  1894,  and  the  land  (together  with  the  amenity,  if  any,  so  developed  or  constructed)  so  acquired   by  agreement or by grant of Floor Space Index or  additional Floor Space Index or Transferable  Development  Rights  under  this  sections  or  under the Land Acquisition Act, 1894, as the  case may be, shall vest absolutely free from  all  encumbrances  in  the  Planning  Authority,  Development  Authority,  or  as  the  case  may  be, any Appropriate Authority.

(2) On receipt of such application, if the State  Government is satisfied that the and specified  in  the  application  is  needed  for  the  public  purpose  therein  specified,  or  if  the  State  Government  (except  in  cases  falling  under  section 49  and except as provided in section  113A)  itself  is  of  opinion  that  any  land  included in any such plan is needed for any  public purpose, it may make a declaration to  that  effect  in  the  Official  Gazette,  in  the  manner  provided  in  section  6  of  the  Land  Acquisition Act,  1894,  in  respect  of  the said  land,  The  declaration  so  published  shall,  notwithstanding anything contained in the said  Act, be deemed to be a declaration duly made  under the said section :

Provided that, subject to the provisions of sub-  section (4), no such declaration shall be made  after the expiry of one year from the date of  publication  of  the  draft  Regional  Plan,  

41

Development  Plan  or  any  other  Plan,  or  Scheme, as the case  may be.

(3)  On publication of a declaration under the  said section 6, the Collector shall proceed to  take order for the acquisition of the land under  the  said  Act;  and  the  provisions  of  that  Act  shall apply to the acquisition of the said land  with the modification that the market value of  the land shall be, -

(i) where the land is to be acquired for the  purposes  of  a  new  town,  the  market  value  prevailing  on  the  date  of  publication of the notification constituting  or declaring the Development Authority  for such town;

(ii) where  the  land  is  acquired  for  the  purposes  of  a  Special  Planning  Authority, the market value prevailing on  the date of publication of the notification  of  the  area  as  an  undeveloped  area;  and

(iii) in any other case the market value on  the  date  of  publication  of  the  interim  development  plan,  the  draft  development  plan  or  the  plan  for  the  area  or  areas  for  comprehensive  development, whichever is earlier, or as  the case may be the date or publication  of the draft town planning scheme :

Provided that, nothing in this sub-section shall  affect the date for the purpose of determining  the market value of land in respect of which  proceedings  for  acquisition  commenced  before the commencement of the Maharashtra  

42

Regional  and  Town  Planning  (Second  Amendment) Act, 1972:

Provided  further  that,  for  the  purpose  of  clause (ii) of this sub-section, the market value  in respect of land included in any undeveloped  area notified under sub-section  (1)  of section  40  prior  to  the  commencement  of  the  Maharashtra  Regional  and  Town  Planning  (Second Amendment) Act, 1972, shall be the  market  value prevailing on the date of  such  commencement.

(4) Notwithstanding  anything  contained  in  the proviso to sub-section (2) and sub-section  (3),  if  a declaration,]  is not made, within the  period referred to in sub-section (2) (or having  been made, the aforesaid period expired on  the  commencement  of  the  Maharashtra  Regional  and  Town  Planning  [(Amendment)  Act, 1993)], the State Government may make  a  fresh  declaration  for  acquiring  the  land  under the Land of Acquisition Act, 1894, in the  manner provided by sub-sections  (2)  and  (3)  of this section, subject to the modification that  the  market  value  of  the  land  shall  be  the  market value at the date of declaration in the  Official Gazette,  made for acquiring the land  afresh.”

Section 127 of the MRTP Act relates to lapsing of reservations.  

The  unamended  provisions  of  Section  127  MRTP  Act,  subject  to  

satisfaction  of  the  ingredients  therein,  provide  that   if  any  land  

reserved, allotted or designated for any purpose specified in any plan  

under this Act is not acquired by agreement within ten years from the  

43

date on which a final Regional plan, or final Development plan comes  

into  force  or  no  steps  for  acquisition  have  been  taken  then  the  

reservation, allotment or designation shall be deemed to have lapsed,  

and thereupon the land shall be deemed to be released from such  

reservation, allotment or designation and shall become available to  

the owner for the purpose of development as otherwise permissible in  

the case of adjacent land under the relevant plan.  The provisions of  

Section  127  of  the  MRTP  Act  came  to  be  amended  by  The  

Maharashtra Regional & Town Planning (Second Amendment) Act,  

2009.   By  amendment,  the  portion  underlined  in  the  unamended  

Section, reproduced hereinafter, was deleted.  The Legislature, in its  

wisdom,  while  deleting  the  reference  to  the  Land  Acquisition  Act  

made lapsing of reservation a consequence of the default arising only  

from sub-sections (2) and (4) of Section 126 of the MRTP Act. Where  

such default appeared as well as no steps for acquisition were taken  

within  the  specified  time,  under  the  amended/unamended  Section  

127  of  the  MRTP  Act,  the  owner  was  required  to  give  notice  in  

relation to release of the property.  If no steps for acquisition were  

taken within 12 months of such notice, the land stood de-reserved.  

The  amended  and  unamended  provisions  of  Section  127  of  the  

44

MRTP Act read as under:

 Unamended “127.  Lapsing of reservations. If  any land reserved, allotted or designated for  any purpose specified in any plan under this  Act  is not  acquired by agreement  within ten  years from the date on which a final Regional  plan,  or  final  Development  plan  comes  into  force  or  if  proceedings for  the acquisition of  such land under  this  Act  or  under  the Land  Acquisition  Act,  1894,  are  not  commenced  within such period, the owner or any person  interested in the land may serve notice on the  Planning Authority, Development Authority or  as the case may be, Appropriate Authority to  that effect; and if within six months from the  date of the service of such notice, the land is  not  acquired  or  no  steps  as  aforesaid  are  commenced  for  its  acquisition,  the  reservation, allotment or designation shall be  deemed  to  have  lapsed,  and  thereupon  the  land  shall  be  deemed  to  be  released  from  such reservation, allotment or designation and  shall  become available  to  the owner for  the  purpose  of  development  as  otherwise,  permissible in the case of adjacent land under  the relevant plan." (emphasis supplied)

Amended “127.  Lapsing of reservations.  (1)  If any land reserved, allotted or designated for  any purpose specified in any plan under this  Act  is not  acquired by agreement  within ten  years from the date on which a final Regional  plan,  or  final  Development  plan  comes  into  force or, if a declaration under sub-section (2)  or (4) of section 126 is not published in the  Official Gazette within such period, the owner  or any person interested in the land may serve  

45

notice, along with the documents showing his  title  or  interest  in  the  said  land,  on  the  Planning Authority, the Development Authority  or,  as  the  case  may  be,  the  Appropriate  Authority  to that  effect  ;  and if  within  twelve  months from the date of the service of such  notice, the land is not acquired or no steps as  aforesaid are commenced for  its  acquisition,  the reservation, allotment or designation shall  be deemed to have lapsed, and thereupon the  land  shall  be  deemed to  be  released from  such reservation, allotment or designation and  shall  become available  to  the owner for  the  purpose  of  development  as  otherwise,  permissible in the case of adjacent land under  the relevant plan;

(2)  On  Lapsing  of  reservation,  allocation  or  designation of any land under sub-section (1),  the Government shall notify the same, by an  order published in the Official Gazette.”   

The objects and reasons for amendment of Section 127 of the  

MRTP Act specifically referred to the hardship to the land owners,  

stated in the judgment of this Court in the case of Girnar Traders v.  

State of Maharashtra [(2007) 7 SCC 555] (hereinafter referred to as  

‘Girnar Traders-II’), pertaining to indefinite waiting for release of their  

respective  lands  because  of  inaction  on  the  part  of  the  Planning  

Authority in acquisition of their lands.  The Legislature was obviously  

aware of the provisions of Section 11A of the Land Acquisition Act  

which  permitted  lapse  of  entire  acquisition  proceedings  after  the  

46

prescribed period.  Still, the Legislature opted to amend Section 127  

of the MRTP Act in the manner as it had amended.  The intention  

appears to be to remove the doubt, if any, created by the unamended  

provisions of Section 127 of the MRTP Act with regard to application  

of Section 11A of the Central Act to the State Act.  Once the State  

Legislature has, by amendment, restricted the application of default  

clause only in the situations covered under Section 126(2) and 126(4)  

of  the State Act  respectively,  it  will  then be impermissible  to read  

Section 11A of the Land Acquisition Act into the language of Section  

126(2) of the State Act.  The amendment  ex-facie  appears to be to  

avoid undue hardship to the owners of the land on the one hand while  

on the other, exclusion of the underlined portion supra especially the  

words ‘under the Land Acquisition Act’, suggests  the legislative intent  

to complete all proceedings within the framework of the MRTP Act.  

Section  128  of  the  State  Act  deals  with  the  powers  of  the  State  

Government to acquire land for purposes other than the one for which  

it is designated in any plan or scheme.  This provision is quite distinct  

and different from any of the provisions in the Land Acquisition Act.  

Section 128(2)  of  the MRTP Act  makes,  by operation of  law, any  

Planning, Development or Appropriate Authority under this Act as a  

47

‘person interested’ in the land acquired under the provisions of the  

Land Acquisition Act; and in determining the amount of compensation  

to be awarded, the market value of the land shall be assessed as if  

the land has been released from reservation, allotment or designation  

made.  Further the Collector or the Court shall take into consideration  

the  damage  sustained  along  with  the  proportionate  cost  of  the  

development  plan  or  town  planning  scheme  or  new town,  if  any,  

incurred by such authority which is rendered abortive by reason of  

such acquisition.    The provisions of Section 129 of the MRTP Act  

are relatable to and in substance are pari materia to the provisions of  

Section 17 of the Land Acquisition Act.  On an application made by  

the  Planning,  Development  or  Appropriate  Authority,  the  State  

Government if satisfied that the possession of any land is reserved or  

designated for a public purpose under any of the plans is urgently  

required in the public interest  by that Authority, can take steps for  

taking possession of the land after giving a notice of 15 days and  

thereupon, the right or interest in that land shall extinguish from the  

date specified; and on the date on which possession is taken, the  

land  shall  vest  without  any  further  assurance  and  free  from  

encumbrances in the State Government.  Of course, this power has  

48

to be exercised in consonance with other provisions of Section 129 of  

the MRTP Act.  Wherever the  possession of the land is taken under  

sub-section (1) the authority is required to pay at the request of the  

person  interested  an  advance  not  exceeding  2/3rd of  the  amount  

estimated to be payable  to such person on account of the land after  

executing  an  agreement  in  that  behalf  under  Section  157  of  the  

MRTP Act.   

The various provisions, which we have indicated above, clearly  

demonstrate a self-contained scheme under the MRTP Act.  Section  

116 of MRTP Act is one other provision which refers to the provisions  

of the Land Acquisition Act and states that a Development Authority  

constituted under Section 113(2) of the MRTP Act is vested with the  

powers of a Planning Authority under Chapter VII of this Act for the  

purposes  of  acquisition  either  by  agreement  or  under  the  Land  

Acquisition Act.   Reference to the provisions of the Land Acquisition  

Act in some of the provisions of the MRTP Act could only imply that  

they  have  solely  been  made  for  the  purpose  of  completing  the  

process of acquisition.  Most of the provisions of the Land Acquisition  

Act,  with  alteration  in  the  language,  have  been  specifically  stated  

49

under the provisions of MRTP Act itself.  Sections 126 to 129 of the  

State  Act  clearly  enunciate  the  intention  of  the  framers  that  

substantive provisions of Land Acquisition Act are not applicable to  

MRTP  Act,  which  is  a  self-contained  code  providing  procedure  

regarding  all  matters  contained  therein,  except  to  the  extent  that  

provisions of Sections 9 to 11 of the Land Acquisition Act be brought  

into it for the limited purpose of acquiring land.  Once the provisions  

of MRTP Act are analyzed in their correct perspective, a holistic view  

can be taken that it is a code in itself.  It is a legislation which has the  

paramount purpose only of planning; and acquisition of land is merely  

incidental,  that  too  for  a  very  limited  purpose.   The object  of  the  

MRTP Act  is  to  specify and provide for  development  plans at  the  

macro as well as micro level.  While providing for larger concepts of  

development  as  contemplated  under  the  regional  plan  as  well  as  

reservations under the development plan, provision for development  

at the most minute level, i.e. a small township as a part of region has  

also been provided.  The primary object of the State Act is planned  

development. Acquisition of land takes place only where the land is  

reserved,  designated  or  required  for  complete  development  in  the  

view  of  the  Planning,  Development  or  Appropriate  Authority.  

50

Complete  mechanism  as  to  how  the  development  plans  shall  be  

prepared, notified and implemented as well as how the land is to be  

acquired, and how the rights and disputes inter se parties as well  as  

between the Planning Authorities and the owners will be settled are  

provided under different provisions of this Act.  In other words, it is  

explicitly  clear  that  a  complete  mechanism  of  planning,  

implementation,  adjudicatory process in that  regard as well  as the  

methodology  adopted  for  acquiring  lands,  in  its  limited  sense,  

inclusive of change in the use, for public purpose, for which the land  

is  required  have  been  specifically  provided  under  the  MRTP Act.  

The State  Act  is  hardly  dependent  upon the  Land Acquisition  Act  

except to the limited extent of completing the process of determining  

compensation,  other  than  the  compensation  determinable  by  the  

designated Arbitrator or Tribunal.  Recourse to legal remedies and  

providing  a  complete  machinery  to  remedy  the  grievances  of  

claimants  is  another  significant  feature  to  be  considered  while  

examining  the  legislative  scheme of  a  statute.   Section  72  of  the  

MRTP  Act  gives  jurisdiction  to  the  Arbitrator  to  decide  certain  

disputes arising between Planning Authority and claimants, as well as  

between  the  private  owners.   The  jurisdiction  of  the  Arbitrator  is  

51

strictly controlled by the provisions of that Section.  The power of the  

Arbitrator in regard to estimation and determination of the amounts,  

as contemplated under Section 72(iii) and 72(iv) of the MRTP Act are  

referable  only  to  Section  97  of  the  State  Act.   The  Arbitrator  is  

primarily to resolve disputes relating to the ‘plots’ as defined under  

the MRTP Act  in  contradistinction to  the expression ‘land’  used in  

other provisions of the Act.  This indicates the limited jurisdiction of  

the Arbitrator.  Appeals lie to the Tribunal only from such orders of the  

Arbitrator which are specified under Sections 73 and 74 of the MRTP  

Act.  The matters for acquisition and payment of compensation are to  

be finalized with the aid of the provisions of the Land Acquisition Act.  

Under Section 83 of the MRTP Act, the lands can be vested in the  

concerned authority at different stages right from the commencement  

of  preparation/approval  of  draft  plan  to  the  final  plans  and  their  

execution under the provisions of  the Act.   Like Section 83 of the  

MRTP Act, Sections 116 and 128(3) of the State Act can be enforced  

by  the  planning  authorities  with  an  object  to  achieve  planned  

development and as part of planning under the Act.  Section 117 of  

the State Act again states the consequences of default.  Where the  

land notified under Section 113 of the MRTP Act, as site of a new  

52

town, is not acquired by the Government or a development authority  

within a period of ten years from the date of notification, the owner is  

entitled to serve a notice upon the authority,  upon service of such  

notice, the provisions of Section 127 of the MRTP Act would come  

into play for lapsing of reservation.  This being the scheme of the  

MRTP Act,  mere reference to some of  the provisions of  the Land  

Acquisition Act would not take away the substantive scheme of the  

State Act which is a complete code in itself.

LAND ACQUISITION ACT, 1894  

Land  Acquisition  Act  was  enacted  as  it  was  considered  

expedient to amend the law for acquisition of land needed for public  

purposes  and  for  companies  and,  particularly,  for  payment  and  

determination of the amount of compensation to be paid on account  

of  such  acquisition.   The  Land  Acquisition  Act,  1870  made  it  

obligatory for the Collector, to refer the matter to Civil  Courts for a  

decision in cases of difference of opinion with interested person(s) as  

53

to value of the land as well as cases in which one of the claimants  

was absent, as the Collector was not empowered to make an award  

ex-parte  even  after  notice.  This  requirement  resulted  in  a  lot  of  

litigation, delay and expenses.  According to the statement of objects  

and reasons of the Land Acquisition Act; the Act of 1870 had not, in  

practice, been found entirely effective for the protection either of the  

persons interested in lands taken up or of the public purse.  Thus the  

law was amended by making Collector’s award final unless altered by  

a  decree.   The persons  interested  in  the  land  thus  still  have  the  

opportunity, if they desire, to prefer to an authority, quite independent  

of the Collector, their claims for more substantial compensation than  

what  the  Collector  has  awarded.  Procedure  for  determining  the  

valuation of land was also proposed to be suitably changed.  Major  

amendments were proposed by the Central  Act  68 of 1984 to the  

Land Acquisition Act.  The statement of objects and reasons for this  

amending Bill posited that due to enormous expansion of the State’s  

role  in  promoting  public  welfare  and economic  development  since  

independence,  acquisition  of  land  for  public  purposes,  

industrialization,  building  of  institutions  etc.  has  become  far  more  

numerous  than  ever  before.   Acquisition  of  land  for  private  

54

enterprises ought not to be placed on the same footing as acquisition  

for  the  State  or  for  an  enterprise  under  it.   The  individuals  and  

institutions who are unavoidably to be deprived of their property rights  

in land need to be adequately compensated for the loss keeping in  

view  the  sacrifice  they  have  to  make  for  larger  interest  of  the  

community.   The  pendency  of  acquisition  proceedings  for  long  

periods often caused hardship to the affected parties and rendered  

unrealistic,  the  scale  of  compensation  offered  to  them.   With  this  

background the legislature felt that it was necessary to restructure the  

legislative  framework  for  acquisition  of  land  so  that  it  is  more  

adequately governed by the objective of serving the interests of the  

community  in  harmony  with  the  rights  of  the  individuals.  

Recommendations  on  similar  lines  were  also  made  by  the  Law  

Commission and while considering these proposals for amendment,  

the legislature carried out various amendments of significance in the  

existing  Land  Acquisition  Act.   Besides  enlarging  the  definition  of  

‘public purpose’, provision was also made for acquisition of land for  

non-governmental companies.  Further, it provided the time limit for  

completion of all formalities between issue of preliminary notification  

under Section 4(1) and declaration under Section 6(1) of the Land  

55

Acquisition  Act.  Section  11A  of  the  Land  Acquisition  Act  was  

introduced which provided for  time limit of two years, from the date of  

publication of declaration under Section 6 of the Central Act, within  

which the Collector should make its award under that Act. Provision  

was  also  made  for  taking  of  possession  of  land  by  the  Collector  

before the award is made in urgent cases.  From the objects and  

reasons of the Land Acquisition Act, it is clear that the primary object  

of this Act is acquisition of land for a public purpose which may be  

‘planned development’ or even otherwise.  In fact the provisions of  

the Land Acquisition Act do not deal with the concept of development  

as  is  intended  under  the  specific  statutes  like  MRTP  Act,  Delhi  

Development Act, 1957, Bangalore Development Authority Act, 1976  

(for short, ‘the Bangalore Act’) etc. The primary purpose of the Land  

Acquisition  Act  is  to  acquire  land  for  public  purpose  and  for  

companies  as  well  as  to  award  compensation  to  the  

owners/interested persons in accordance with the provisions of this  

Act.   

The  acquisition  proceedings  commence  with  issuance  of  a  

notification under Section 4 of the Land Acquisition Act against which  

56

the  interested  persons  are  entitled  to  file  objections  which  will  be  

heard by the competent authority in accordance with the provisions of  

Section 5A leading to issuance of declaration under Section 6 of the  

Land  Acquisition  Act.   After  complying  with  the  requirements  of  

Section 9 of the Land acquisition Act,  the Collector is expected to  

make an award under Section 11 of the Central Act and in terms of  

Section 11A of the Land Acquisition Act,  if  the award is not made  

within two years from the date of publication of the declaration the  

acquisition  proceedings  shall  lapse.   Section  11A  of  the  Land  

Acquisition Act reads as under:

“11A. Period within which an award shall be  made.—(1)  The  Collector  shall  make  an  award under  section  11  within  a  period  of  two years from the date of the publication of  the  declaration  and  if  no  award  is  made  within that period, the entire proceedings for  the acquisition of the land shall lapse:

Provided  that  in  a  case  where  the  said  declaration  has  been  published  before  the  commencement  of  the  Land  Acquisition  (Amendment) Act, 1984, the award shall be  made within a period of two years from such  commencement.

Explanation.—In computing the period of two  years  referred to  in  this  section the period  during which any action or proceeding to be  taken in pursuance of the said declaration is  

57

stayed  by  an  order  of  a  Court  shall  be  excluded.”

If the award is made within the stipulated period, such award  

attains finality under Section 12 of the Land Acquisition Act and is  

conclusive  evidence  of  the  true  area  or  the  value  of  the  land  as  

between the collector and person interested.  In normal acquisition  

proceedings,  after  passing  the  award,  the  Collector  may  take  

possession of the land which shall thereupon vest absolutely in the  

Government  free from all  encumbrances as per  Section 16 of  the  

Land Acquisition Act.  The possession can also be taken earlier as  

the Appropriate Government is vested with special powers in cases of  

urgency.  In  that  case,  the  provisions  of  Section  17  of  the  Land  

Acquisition Act state the scheme to be followed by the Collector for  

acquisition of the land including taking of possession prior to making  

of  an  award.   Section  48  of  the  Land  Acquisition  Act  is  another  

important provision of this Act which empowers the Government to  

withdraw from the acquisition of any land of which possession has not  

been  taken  and  whenever  it  withdraws  from  the  acquisition,  the  

Collector  shall  determine the amount  of  compensation due for  the  

damage suffered by the owner/interested person in consequence of  

58

such proceedings.  The owner/interested person is entitled to invoke  

the remedy of reference under Section 18 of the Land Acquisition Act  

against  the  award  made  by  the  Collector  and  thereafter  he  may  

appeal to the High Court under Section 54 of the Land Acquisition Act  

for  enhancement  of  compensation  including  determination  of  the  

disputes covered under the provisions of this Act.  As is evident from  

the  afore-narrated  provisions,  the  primary  purpose  and  the  only  

object of the Land Acquisition Act is acquisition of land and payment  

of  compensation for such acquisition.    It  is not an Act dealing  in  

extenso or otherwise with development and planning.  The scheme of  

this  Act  is  very  simple.   Despite  the  fact  that  it  is  compulsory  

acquisition,  which  is  in  exercise  of  the  State’s  power  of  eminent  

domain,  the  legislature  has  still  attempted  to  create  a  balance  

between  compulsory  acquisition  on  the  one  hand  and  rights  of  

owner/interested  person  in  land  on  the  other.  The  acquisition  

proceedings  are  commenced with  issuance of  a  notification  under  

Section 4 of the Land Acquisition Act for a public purpose and would  

end with the payment of compensation for such acquired land.  The  

mechanism provided under this Act is entirely relatable to the process  

of acquisition of land and payment of compensation.  This Court in  

59

the case of Delhi Development Authority v. Mahender Singh [(2009) 5  

SCC 339],  while  examining the scope of  power of  the High Court  

under Article 226 of the Constitution to direct payment of statutory  

interest in terms of Section 34 of the Land Acquisition Act held as  

under:

11. “In D-Block Ashok Nagar (Sahibabad) Plot  Holders’ Assn. (Regd.) v. State of U.P.[(1997)  7  SCC  77] this  Court  again  observed  that  liability to pay interest to the claimant arises  only in accordance with Section 34 of the Act.  As the Act is a self-contained code, common  law principles  of  justice,  equity  and  good  conscience cannot  be extended in  awarding  interest, contrary to or beyond the provisions  of the statute.”

The Land Acquisition Act itself is a self contained code within  

the  framework  of  its  limited  purpose,  i.e.  acquisition  of  land.   It  

provides for complete machinery for acquisition of land including the  

process  of  execution,  payment  of  compensation  as  well  as  legal  

remedies in case of any grievances.   

Having stated the scheme of the two Acts, let us proceed to  

examine  if  there  are  marked  distinctions  between  the  statutory  

provisions of the two Acts and, if so, what is the scope of the same.

Sl. Land Acquisition Act MRTP Act

60

No. 1. The Land Acquisition Act  is  a  

legislation  regulating  only  the  acquisition of land for a public  purpose  and  payment  of  its  compensation.  In other words,  it  is a legislation of acquisition  alone  and  is  in  no  way  concerned  with  planned  development.

The  primary  object  of  MRTP  Act  is  regional/town  planning  and development of the entire  State  of  Maharashtra.   The  function  of  the  authorities  constituted  under  the  Act  is  planning.  The purpose of the  Act  primarily  is  planned  development and acquisition is  incidental thereto.

2. The  lands  are  to  be  acquired  only  for  a  public  purpose  in  terms of  the notification under  Section 4.

The  Act  deals  with  and  provides only for land required,  reserved  or  designated  for  planned development.

3. Upon  issuance  of  notification  under Section 4 of the Act, the  owner/interested  person  can  develop the land or  utilize the  same for his benefit but without  claiming any compensation for  such   modification subsequent  to  the  date  of  the  notification  (Matter  seventhly  of  Section  24)

Even  prior  to  issuance  of  declaration  under  Section  126(2),  i.e.,  on  publication  of  declaration  of  intention  to  prepare  a  development  plan  for any area under Section 43  or  town  planning  scheme  under Section 69, the rights of  the  owner  are  completely  restricted.   No  person  is  entitled  to  institute  or  change  the use of any land or carry out  any  development  of  land  without  permission  of  the  authority under Section 43 or a  commencement  certificate  under Section 69.

4. Under  normal  proceedings  for  acquisition  under  the  Act,  the  land  vests  in  the  Government  only  after  the  award  is  made  and  possession  is  taken  in  terms of Section 16 of the Act,  of  course  with  the  exception  

Under  this  Act,  the  land  required for development vests  in the Government at the very  threshold.   Under  Section  129(1)  when  emergency  provisions  are  invoked,  the  land  shall  vest  without  any  

61

stated in Section 17 of the Act. further  assurance  and  free  from  all  encumbrances  in  the  State  only  when  notice  of  15  days is given by the Collector  prior  to  taking  possession.  Section  83  shows  marked  distinction  that  possession  of  the  land  can  be  taken  and  it  shall  vest  in  the  Government/authority  where  it  is  necessary  to  undertake  forthwith  any  work  included  even  in  a  draft  scheme for  a  public purpose.

5. Under  this  Act,  there  is  no  provision empowering the State  Government to acquire the land  for any purpose other than the  one specified in the notification  issued  under  Section  4  for  which  the  property  was  acquired.  

In terms of Section 128(1), the  Government  has  been  vested  with the power to acquire land  for the purposes other than the  one for  which it  is  designated  in any plan or scheme.

6. Very few provisions provide for  limitation of period within which  the  action  by  the  authority  is  required  to  be  taken  and  default  thereto  results  in  substantial  consequences.  (Sections 6 and 11A)

There  are  as  many  as  80  different  provisions  of  the  Act  which provide limitation of time  for  commencement,  execution  and  completion  of  actions  by  the  authorities  concerned  and  in  default  the  consequences  flowing therefrom.

7. The Collector is vested with all  the powers under the Act right  from acquisition till payment of  compensation.   The  award  passed  by  the  Collector  is  subject to reference and appeal  under the provisions of the Act.

Multiple authorities have been  constituted  under  different  provisions of the Act which are  responsible for  performing the  specified  functions.   The  Arbitrator  nominated  and  the  Tribunal  constituted under  the  provisions  of  the  Act  has  to  

62

perform  practically  all  the  adjudicatory  proceedings  except  where  land  is  to  be  acquired  for  planned  development  acquisition  thereof  and  awarding  of  its  compensation by the Collector.

8. This Act is a Central Legislation  relatable to Entry 42 of List III  of  Schedule  VII  to  the  Constitution.

This Act is a State Legislation  relatable to Entries 5 and 18 of  List  II  of  the  Schedule  VII  to  the  Constitution.  (without  prejudice  to  the  contention  of  the parties)

9. The  market  value  of  the  land  has to be determined as of the  date of issuance of notification  under  Section  4  of  the  Land  Acquisition Act.

The  market  value  has  to  be  determined  with  reference  to  the  date/dates  specified  in  Section  126(3)  and  upon  issuance  of  a  declaration  under  Section  126(2)  in  the  manner  for  issuance  of  declaration under Section 6 of  the LA Act.

10. The Government can withdraw  from  acquisition  of  any  land  before  possession  is  taken  in  terms of Section 48 of the Act

There  is  no  provision  empowering  the  planning  authority from de-notifying land  from acquisition.   However,  in  terms  of  Section  50,  it  has  power  to  delete  from  reservation, designation for an  interim draft plan.

These are some of the glaring points of distinction between the  

two Acts.  Of course, there may be other distinctions and the ones  

stated by us are only illustrative.  The purpose of referring to these  

63

distinctions  is  primarily  to  demonstrate  that  they  are  two  different  

statutes  operating  in  different  fields,  the  provisions  of  which  are  

required  to  be utilized  by the  concerned  authorities  for  the  object  

sought  to  be  achieved  under  the  respective  Acts.   The  schemes  

under the two Acts are distinct and different.  Scheme under the State  

Act can be implemented with recourse to the provisions of the Central  

Act which have been specifically stated therein.  At the same time  

where  there  are  specific  provisions  under  the  State  Act  the  

corresponding  provisions  of  the  Central  Act  will  not  apply.   The  

provisions of the Land Acquisition Act relating to the acquisition of  

land alone, for which there are no specific provisions under the  State  

Act, would be applicable to the acquisition under the State Act.  This  

view was also taken by a three Judge Bench of this Court in a very  

recent  judgment  in  the  case  of  Bondu Ramaswamy v.  Bangalore  

Development Authority [(2010) 7 SCC 129].

SELF-CONTAINED CODE

For an Act to be a ‘self-contained code’,  it  is  required to be  

shown that it is a complete legislation for the purpose for which it is  

enacted.   The  provisions  of  the  MRTP  Act  relate  to  preparation,  

64

submission  and  sanction  of  approval  of  different  plans  by  the  

concerned  authorities  which  are  aimed  at  achieving  the  object  of  

planned development in contradistinction to haphazard development.  

An owner/person interested in the land and who wishes to object to  

the  plans  at  the  appropriate  stage  a  self-contained  adjudicatory  

machinery has been spelt out in the MRTP Act.  Even the remedy of  

appeal  is  available  under  the  MRTP Act  with  a complete  Chapter  

being devoted to acquisition of  land for  the planned development.  

Providing adjudicatory mechanism is one of the most important facets  

of deciding whether a particular statute is a ‘complete code’ in itself or  

not.   

This Court  in  Munithimmaiah v.  State of Karnataka [(2002) 4  

SCC 326] had the occasion to consider somewhat similar question in  

relation  to  the  Bangalore  Act  and  the  provisions  of  the  Land  

Acquisition Act.  The provisions of Section 36 of the Bangalore Act  

refer to application of the provisions of the Land Acquisition Act.  The  

Court rejected the plea that provisions of Sections 6 and 11A of the  

Land  Acquisition  Act  providing  a  shorter  period  of  limitation  for  

publication  of  final  notification  and  making  of  an  award,  were  

65

applicable  to  acquisition  made under  the  Bangalore  Act.   Further,  

while  holding that  the Bangalore Act  is  a  self-contained code,  the  

Court held as under :

“15. So far as the BDA Act is concerned, it is  not an Act for mere acquisition of land but an  Act  to  provide  for  the  establishment  of  a  development authority to facilitate and ensure  planned growth and development of the city of  Bangalore  and  areas  adjacent  thereto  and  acquisition of lands, if any, therefore is merely  incidental  thereto.  In pith and substance the  Act is one which will squarely fall under, and  be  traceable  to  the  powers  of  the  State  Legislature  under  Entry  5  of  List  II  of  the  Seventh  Schedule  and  not  a  law  for  acquisition  of  land  like  the  Land  Acquisition  Act, 1894 traceable to Entry 42 of List III of the  Seventh Schedule to the Constitution of India,  the  field  in  respect  of  which  is  already  occupied by the Central  enactment of  1894,  as amended from time to time.  If  at  all,  the  BDA Act, so far as acquisition of land for its  developmental  activities  is  concerned,  in  substance and effect will  constitute a special  law  providing  for  acquisition  for  the  special  purposes of BDA and the same was not also  considered to be part of the Land Acquisition  Act,  1894.  It  could  not  also  be  legitimately  stated, on a reading of Section 36 of the BDA  Act  that  the  Karnataka  Legislature  intended  thereby  to  bind  themselves  to  any  future  additions  or  amendments,  which  might  be  made by altogether a different legislature, be it  Parliament, to the Land Acquisition Act, 1894.  The procedure for acquisition under the BDA  

66

Act  vis-à-vis  the  Central  Act  has  been  analysed  elaborately  by  the  Division  Bench,  as noticed supra, in our view, very rightly too,  considered  to  constitute  a  special  and  self- contained code of  its  own and the BDA Act  and Central  Act  cannot be said to be either  supplemental  to  each  other,  or  pari  materia  legislations. That apart, the BDA Act could not  be said  to  be  either  wholly  unworkable  and  ineffectual if  the subsequent amendments to  the  Central  Act  are  not  also  imported  into  consideration. On an overall consideration of  the  entire  situation  also  it  could  not  either  possibly  or  reasonably  be  stated  that  the  subsequent  amendments  to  the  Central  Act  get  attracted  or  applied  either  due  to  any  express provision or by necessary intendment  or  implication to acquisitions under the BDA  Act. When the BDA Act, expressly provides by  specifically enacting the circumstances under  which and the period of time on the expiry of  which  alone  the  proceedings  initiated  thereunder shall lapse due to any default, the  different  circumstances  and  period  of  limitation  envisaged  under  the  Central  Act,  1894,  as  amended  by  the  amending  Act  of  1984 for completing the proceedings on pain  of  letting  them  lapse  forever,  cannot  be  imported  into  consideration  for  purposes  of  the  BDA  Act  without  doing  violence  to  the  language or destroying and defeating the very  intendment of the State Legislature expressed  by the enactment of its own special provisions  in  a  special  law  falling  under  a  topic  of  legislation exclusively earmarked for the State  Legislature.”

67

A Constitution Bench of this Court in  Prakash Amichand Shah  

v.  State  of  Gujarat [(1986)  1  SCC  581],  while  dealing  with  the  

erstwhile Bombay Town Planning Act, 1954 (for short, ‘the Bombay  

Act’)  discussed  in  some  elaboration  the  working  under  the  Land  

Acquisition  Act  vis-à-vis  the  Bombay  Act.   The  Court  said  that  

development  and  planning  carried  out  under  the  Bombay  Act  is,  

primarily, for the benefit of the public.  The local authority is under an  

obligation to function according to the Bombay Act and has to bear  

part of the expenses of development.  It is in one sense a package  

deal.  The proceedings relating to scheme are neither like acquisition  

proceedings  under  the  Land Acquisition  Act  nor  its  provisions  are  

made  applicable  to  the  Bombay  Act  either  with  or  without  

modifications as in the case of Nagpur Improvement Trust Act, 1936.  

Another  school  of  thought  has  taken  the  view  that  while  

determining  whether  a  statute  is  a  self-contained  code  or  not,  

relevant consideration would be whether such Act contains a bar for  

application of other statute by specific language or even by necessary  

implication  to  the  Act  in  question.   In  some cases,  there  may be  

general application of other laws to the law in question or there may  

68

be a reference of certain provisions of other statute in the provisions  

of the later statute and only those specified provisions would apply to  

the later statute while in other cases, the situation may be different  

where  the  later  statute  is  not  a  self-contained  code.   It  may  be  

possible to enforce the bar or  limitations created under the earlier  

statute  even  by  subsequent  amendments.   We  may  refer  to  the  

judgment of this Court in the case of Gopal Sardar v. Karuna Sardar  

[(2004) 4 SCC 252], wherein the Court was concerned with the West  

Bengal Land Reforms Act, 1955.  Some of the provisions of that Act  

referred to certain provisions of the Limitation Act, 1963. Section 8 of  

the West Bengal Land Reforms Act required service of the notice in  

terms of Section 5(5) within three months of the date of the transfer  

but no reference was made to any of the provisions of the Limitation  

Act  in  this  Section.   The contention  raised was that  the  applicant  

could invoke Section 5 of the Limitation Act for condoning the delay in  

filing an application in terms of Section 8 of the West Bengal Land  

Reforms Act.   The Court while emphasizing, that the West Bengal  

Land Reforms Act was a self-contained code, held as under:

“13. Section 8 of  the Act  prescribes definite  period  of  limitation  of  three  months  or  four  

69

months,  as  the  case  may  be,  for  initiating  proceedings for  enforcement  of  right  of  pre- emption by different categories of people with  no provision made for extension or application  of Section 5 of the Limitation Act. When in the  same  statute  in  respect  of  various  other  provisions  relating  to  filing  of  appeals  and  revisions, specific provisions are made so as  to give benefit  of Section 5 of the Limitation  Act  and  such  provision  is  not  made  to  an  application to be made under Section 8 of the  Act,  it  obviously and necessarily follows that  the  legislature  consciously  excluded  the  application of Section 5 of the Limitation Act.  Considering  the  scheme of  the  Act  being  a  self-contained code in dealing with the matters  arising under Section 8 of the Act and in the  light  of  the  aforementioned decisions  of  this  Court in the case of Hukumdev Narain Yadav,  Anwari  Basavaraj  Patil and  Parson  Tools it  should  be  construed  that  there  has  been  exclusion  of  application  of  Section  5  of  the  Limitation Act to an application under Section  8 of the Act. In view of what is stated above,  the  non-applicability  of  Section  5  of  the  Limitation  Act  to  the  proceedings  under  Section 8 of the Act is certain and sufficiently  clear. Section 29(2) of the Limitation Act as to  the  express  exclusion  of  Section  5  of  the  Limitation  Act  and  the  specific  period  of  limitation  prescribed  under  Section  8  of  the  Act  without  providing  for  either  extension  of  time  or  application  of  Section  5  of  the  Limitation  Act  or  its  principles  can  be  read  together harmoniously.”

70

In the case of  Church of North India v.  Lavajibhai Ratanjibhai  

[(2005) 10 SCC 760], Bombay Public Trusts Act, 1950 under which  

the jurisdiction of the Civil Court is expressly barred was held to be a  

‘complete code’ in itself providing adequate machinery to deal with  

disputes relating to management of trust property.  The provisions of  

this Act and the scheme thereof left no manner of doubt that the Act  

is a complete code in itself.  It provides for a complete machinery for  

a  person interested  in  a  trust  to  put  forward  his  claim before  the  

Charity Commissioner, who is the  competent authority under this Act  

to  go into  the  said  question and can prefer  an appeal  if  he  feels  

aggrieved by any decision.

Now,  we  may,  while  referring  to  an  example,  show when a  

statute may not be treated as a self-contained Code.  In the case of  

Mariyappa v. State of Karnataka [(1998) 3 SCC 276], a Bench of this  

Court  was  concerned  with  the  Karnataka  Acquisition  of  Land  for  

Grant of House Sites Act, 1972 (in short ‘the Karnataka Act’) which  

was an Act of only seven Sections and Section 5 of which provided  

that  provisions  of  the  Land  Acquisition  Act  shall  mutatis  mutandis  

apply.  The Court, in paragraph 37 of the judgment, stated that there  

71

being  no  detailed  machinery  whatsoever  in  the  Karnataka  Act,  it  

cannot be treated as a self-contained code.  This clearly shows that if  

complete machinery or mechanism is not provided under an Act to  

ensure effective execution of the functions assigned therein with due  

protection of the rights of the interested persons within the framework  

of law, it may not be possible for the Court to hold that such a statute  

is a self-contained code.   

It  may  not  be  possible  to  state  parameters  of  universal  

application which could determine with precision as to whether an Act  

is a self-contained code or not.  It is difficult and, in fact, may not even  

be  permissible  to  formulate  any  hard  and  fast  rule  which  could  

uniformly be applied to all statutes for such determination.  We have  

merely indicated some of the features which could serve as precepts  

for the courts to analyse whether an Act is a complete code in itself or  

not.  The expression ‘complete code in itself’ has not been defined  

precisely.  However, it will be of some help to understand what the  

word ‘code’ means.  It has been explained in P. Ramanatha Aiyar’s  

‘The Law Lexicon’ (2nd Edn. 1997) as under :

“A general collection or compilation of laws by  public authority; a system of law; a systematic  

72

and  complete  body  of  law,  on  any  subject  such  as  Civil  Procedure  Code,  Code  of  Criminal Procedure, Penal Code. etc.

… The code is broader in its scope, and more  comprehensive  in  its  purposes.   Its  general  object is to embody, as near as practicable, all  the law of the state, on any particular subject.  It is more than evidentiary of the law; it is the  law itself.”

‘Complete’ further adds a degree of certainty to the code.  It has  

to be a compilation of provisions which would comprehensively deal  

with various aspects of the purpose sought to be achieved by that law  

and its dependence on other legislations is either absent or at best is  

minimal.  The provisions of the enactment in question should provide  

for  a  complete  machinery  to  deal  with  various problems that  may  

arise during its execution.  Sufficient powers should be vested in the  

authority/forum  created  under  the  Act  to  ensure  effectual  and  

complete implementation of the Act.  There should be complete and  

coherent  scheme of  the  statutory  provisions  for  attainment  of  the  

object and purpose of the Act.  It essentially should also provide for  

adjudicatory scheme to deal with grievances/claims of the persons  

affected  by  enforcement  of  the  provisions  of  the  Act,  preferably,  

including an appellate forum within the framework of the Act.  In other  

73

words, the Act in itself should be a panacea to all facets arising from  

the implementation of the Act itself.  

Upon analysis of the above principles and particularly keeping  

in mind the negative instance in the case of  Mariyappa  (supra), we  

may turn  back  to  the  provisions  of  the  MRTP Act.   The principal  

object  of  this  legislation  is  planned  development  of  the  State  of  

Maharashtra by preparing development plans for regions and town  

planning schemes and constitution of various authorities to achieve  

the said purpose.  Incidentally, it includes the function of acquisition  

of  land  but  for  a  very  limited  purpose.   It  is  not  expected  of  the  

authorities to apply to the Government for a general acquisition but  

the acquisition has to be of the land which is required, reserved or  

designated under any development plan.  Thus, it is an acquisition of  

a  very  limited  connotation.   The  MRTP  Act  specifies  all  the  

authorities,  their  respective  powers  and  functions  for  attaining  the  

object of the Act.

The complete scheme has been provided under the MRTP Act  

for attaining the object of planned development.  Various provisions  

of  the Act comprehensively prescribe what and how the steps are  

74

required to be taken by the authorities under the Act, right from the  

stage of preparation of draft development plan to its finalization as  

well as preparation and finalization of all regional and town planning  

schemes.  The MRTP Act clearly spells out as to how these schemes  

are to be implemented and by whom.  Right of the interested person  

to  raise  objections,  pre-finalization  of  the  respective  plans,  is  

specifically provided.  The authority before whom such objections are  

to be raised and who is to be granted hearing and by whom is clearly  

spelt out.  There is no aspect which is not dealt with or provided for  

under the provisions of the State Act right from the initial stage to its  

final execution.  Besides providing right of objection to the owner of  

the land or property, which fall within the development plan, the State  

Act  also  provides  machinery  for  finalization  and  determination  of  

disputes between the authorities and private parties.  Furthermore, a  

person  is  entitled  to  raise  all  disputes  including  the  dispute  of  

ownership.  The Arbitrator nominated under the MRTP Act has the  

jurisdiction  to  decide  all  such  matters.   The  jurisdiction  of  the  

Arbitrator  is  a  limited  one  like  estimation  and  payment  of  

compensation in relation to  plots in distinction to lands as defined  

under the Act within the four corners of the provisions of Sections 72  

75

to 74 of the MRTP Act with reference to Section 97 of the State Act.  

Some of his decisions are final, while on most of other decisions, an  

appeal lies to the Tribunal.   

The MRTP Act  besides  being  a  code  in  itself  has  one  pre-

dominant  purpose,  i.e.,  planned  development.   Other  matters  are  

incidental  and, therefore,  should be construed to achieve that pre-

dominant object.  All the provisions of the Land Acquisition Act cannot  

be applied to the MRTP Act.  The provisions of the MRTP Act have to  

be implemented in their own field.  As far as the provisions relating to  

preparation,  approval  and execution of  the development  plans are  

concerned, there is hardly any dependency of the State Act on the  

provisions  of  the  Land  Acquisition  Act.   It  may  be  necessary,  

sometimes, to acquire land which primarily would be for the purpose  

of  planned  development  as  contemplated  under  the  MRTP  Act.  

Some of the provisions of the State Act have specifically referred to  

some of the provisions of the Land Acquisition Act but for the limited  

purpose of acquiring land.  Thus, the purpose of such reference is,  

obviously, to take aid of the provisions of the Central Act only for the  

purpose of  acquiring a land in  accordance with law stated therein  

76

rather than letting any provision of the Central Act hamper or obstruct  

the principal  object  of  the State Act,  i.e.  execution of  the planned  

development.  There can hardly be any hesitation in concluding that  

the MRTP Act is a self-contained code and does not lose its colour or  

content of being a self-contained code merely because it  makes a  

reference  to  some  of  the  provisions  of  Land  Acquisition  Act  for  

acquisition of land for the purpose of MRTP Act and determination of  

compensation in  that  behalf.   The referred  provisions of  the  Land  

Acquisition  Act  may only  be taken recourse to  that  limited  extent,  

within the extensive framework and for the purpose of MRTP Act.

Therefore, MRTP Act is an Act which completely provides for  

various  steps  in  relation  to  execution  of  its  object,  constitution  of  

various authorities to implement the underlying scheme of planned  

development, machinery for interested persons to raise their claims  

for  adjudication  under  the  provisions  of  this  Act  or  at  best  to  an  

authority  referred  to  in  the  Act.   Thus,  we  have  no  hesitation  in  

holding that the MRTP Act is a complete code in itself.

Whether  the  provisions  of  the  Central  Act  68  of  1984,  with  particular reference to Section 11A, can be read into and treated  as part of the MRTP Act on the principle of either legislation by  reference or legislation by incorporation?

77

At  the  very  outset,  we  may  notice  that  in  the  preceding  

paragraphs of the judgment, we have specifically held that MRTP Act  

is a self-contained code.  Once such finding is recorded, application  

of either of the doctrines, i.e. ‘legislation by reference’ or ‘legislation  

by incorporation’, would lose their significance particularly when the  

two Acts can co-exist and operate without conflict.

However, since this aspect was argued by the learned counsel  

appearing for the parties at great length, we will proceed to discuss  

the  merit  or  otherwise  of  this  contention  without  prejudice  to  the  

above findings and as an alternative plea.   These principles have  

been applied by the courts  for  a  considerable period now.  When  

there is general reference in the Act in question to some earlier Act  

but there is no specific mention of the provisions of the former Act,  

then it is clearly considered as legislation by reference.  In the case of  

legislation by reference, the amending laws of the former Act would  

normally become applicable to the later Act; but, when the provisions  

of an Act are specifically referred and incorporated in the later statute,  

then  those  provisions  alone  are  applicable  and  the  amending  

78

provisions of the former Act would not become part of the later Act.  

This principle is generally called legislation by incorporation.  General  

reference, ordinarily, will imply exclusion of specific reference and this  

is precisely the fine line of distinction between these two doctrines.  

Both are referential legislations, one merely by way of reference and  

the other by incorporation.  It, normally, will depend on the language  

used in the later law and other relevant considerations.  While the  

principle of legislation by incorporation has well defined exceptions,  

the  law  enunciated  as  of  now  provides  for  no  exceptions  to  the  

principle  of  legislation  by  reference.   Furthermore,  despite  strict  

application  of  doctrine  of  incorporation,  it  may  still  not  operate  in  

certain  legislations  and such legislation  may fall  within  one of  the  

stated exceptions.  In this regard, the judgment of this Court in the  

case of M.V. Narasimhan  (supra) can be usefully noticed where the  

Court after analyzing various judgments, summed up the exceptions  

to this rule as follows :

“(a) where  the  subsequent  Act  and  the  previous Act are supplemental  to each  other;

(b) where the two Acts are in pari materia;

79

(c) where  the  amendment  in  the  previous  Act, if not imported into the subsequent  Act also, would render the subsequent  Act  wholly  unworkable  and  ineffectual;  and

(d) where  the  amendment  of  the  previous  Act,  either  expressly  or  by  necessary  intendment,  applies the said provisions  to the subsequent Act.”

With the development of law, the legislature has adopted the  

common practice of referring to the provisions of the existing statute  

while enacting new laws.  Reference to an earlier law in the later law  

could  be  a  simple  reference  of  provisions  of  earlier  statute  or  a  

specific reference where the earlier law is made an integral part of the  

new law, i.e., by incorporation.  In the case of legislation by reference,  

it is fictionally made a part of the later law.  We have already noticed  

that all amendments to the former law, though made subsequent to  

the enactment of the later law, would ipso facto apply and one finds  

mention of this particular aspect in Section 8 of the General Clauses  

Act,  1897.  In contrast to such simple reference, legal incidents of  

legislation by incorporation is that it becomes part of the existing law  

which implies bodily lifting provisions of one enactment and making  

them part of another and in such cases subsequent amendments in  

80

the incorporated Act could not be treated as part of the incorporating  

Act.  Ultimately, it is the expression and/or the language used in the  

new law with reference to the existing law that would determine as to  

under  what  class  of  referential  legislation  it  falls.   In  some of  the  

statutes, expressions like “shall for that purpose be deemed to form  

part of this Act in the same manner as if they were enacted in the  

body thereof”6 or “the provisions of Section of the said Act (set out in  

the  Schedule)  shall  apply  as  if  they were  herein  re-enacted”7 are  

typical  examples  of  legislation  by  incorporation.   Another  glaring  

example  of  incorporation  one  finds  in  the  provision  of  Bombay  

Municipal  Corporation  Act,  1949  where  Section  284N  uses  the  

expression “the LA Act … shall for that purpose be deemed to form  

part of this chapter as if enacted in the body hereof”. Another feature  

of  legislation  by  incorporation  is  that  the  language  is  explicit  and  

positive.   This  demonstrates  the  desire  of  the  legislature  for  

legislation  by  incorporation.   Self-contained  enactment  should  be  

clearly  distinguished  from  supplemental  law.   When  the  later  law  

depends on the former law for procedural/substantive provisions or is  

to draw its strength from the provisions of the former Act, the later Act  

6 In Section 20 of 53 Vict. Ch 70 – Housing of the Working Classes Act, 1890. 7 Section 1(3) of 54 and 55 Vict. Ch 19

81

is termed as the supplemental to the former law.  The statement of  

object and reasons of both the Acts, i.e. the MRTP Act and the Land  

Acquisition Act as well as the scheme of these Acts, we have already  

discussed at length.  They are Acts which operate in different fields.  

One is a Central Act while the other is a State Act.  They derive their  

source from different entries in the constitutional lists.  

On behalf of the appellant, it was contended before us that the  

MRTP Act would be rendered unworkable and ineffective without the  

provisions of  the Land Acquisition Act.   It  was also contended on  

behalf of the appellants that reservation and acquisition has a clear  

legal  dichotomy and if  acquisition lapses it  will  result  in lapsing of  

reservation by operation of  provisions of  Section 11A of  the Land  

Acquisition Act.  Thus, it is implied that the provisions of Section 11A  

would form an integral part of the MRTP Act and an acquisition will  

lapse in terms thereof in the event of default.    While referring to the  

provisions of Sections 113A, 116 and 126(2) of the MRTP Act,  it is  

stated that there is a generic reference to the provisions of the Land  

Acquisition Act.  Therefore, all the amendments made by the Central  

Act 68 of 1984, with particular reference to Section 11A of the Land  

82

Acquisition Act, would be read into the provisions of the MRTP Act.  

Keeping in view the language used by the Legislature, it will inevitably  

be legislation by reference.   

Per contra, the submission made on behalf of the respondents  

is that both these Acts operate in different fields and have a different  

object.  The provisions specifically referred, clearly demonstrate that  

the intent of the legislature, at best, was to incorporate these limited  

provisions of the Land Acquisition Act and, but for the application of  

those provisions, nothing else would form part of the later law, i.e. the  

MRTP  Act.   This  being  legislation  by  incorporation,  the  general  

reference to the provisions of the Land Acquisition Act shall  stand  

excluded.  Both the laws, according to the respondents, are wholly  

dissimilar and the principal purpose of the MRTP Act can be achieved  

without the aid of the Land Acquisition Act which has a very limited  

and  restricted  application.  It  is  argued  that  there  being  specific  

provisions providing  for different time schedules in the MRTP Act at  

a number of places, it will not be permissible to read in a bar in that  

respect  from another  legislation.   In  other  words,  to  bodily  lift  the  

provisions of the Land Acquisition Act and imprint them in the MRTP  

83

Act,  including  Section11A,  would  be  impermissible  as  the  State  

Legislature  has  already  exercised  its  legislative  power  by  

enacting/amending Sections 126 and 127 of the MRTP Act in face of  

the provisions of Section 11A of the Land Acquisition Act.   

Now,  let  us  examine  the  specific  reference  made  to  the  

provisions of the Land Acquisition Act in the provisions of the MRTP  

Act.   Section  113A  of  the  MRTP  Act  provides  that  where  any  

company  or  corporation  has  been  declared  to  be  the  new  town  

development authority under sub-section (3A) of Section 113, then  

the State Government shall acquire either by agreement or under the  

Land Acquisition Act any land within the area designated under this  

Act.   Similarly,  Section  116  of  the  MRTP Act  gives  power  to  the  

development  authority constituted under  sub-section (2)  of  Section  

113 as having all  powers of a planning authority under this Act as  

provided  in  Chapter  VII  for  the  purpose  of  acquisition  either  by  

agreement or under the Land Acquisition Act.  This clearly shows that  

these  provisions  make  reference  to  a  specific  aspect  of  the  

acquisition, i.e. for exercise of powers by the authority concerned for  

the purposes of  Chapter  VII  of  the State Act.   Section 125 of  the  

84

MRTP Act introduces a legal fiction as it requires that reservation and  

designation of land under the plan shall be deemed to be a public  

purpose within the meaning of the definition of Land Acquisition Act.  

Section 126 of the MRTP Act is the effective provision which refers to  

the Land Acquisition Act.  In terms of Section 126(1), the land can be  

acquired for  public purpose specified in the plan.  It  gives right  to  

acquire even after publication of a draft regional plan.  Whenever a  

land is required or reserved for any public purpose specified in any  

plan or scheme under the MRTP Act, the concerned authority may,  

with the exception of the provisions of Section 113A of the State Act,  

i.e. land designated under the Act connected with the development of  

the new town, acquire the land by different modes i.e. (a) by paying  

an amount agreed (by agreement); (b) in lieu of any such amount by  

granting  the  right  specified  under  Section  126(1)(b);  and  (c)  by  

making an application to the State Government for  acquiring such  

land under the Land Acquisition Act.  Section 126(2) lays down the  

procedure, primarily, as to how the application made under Section  

126(1)(c)  is  to  be dealt  with  by the State Government  and if  it  is  

satisfied, to make a declaration in the Official Gazette to the effect  

that the land is needed for a public purpose, in the manner provided  

85

in Section 6 of the Land Acquisition Act.  Section 126(3) deals with  

the procedure to be followed after  declaration contemplated under  

Section 126(2) has been published. The Collector has to proceed for  

acquisition  of  the  land  under  the  Land  Acquisition  Act  and  the  

provisions of that Act shall apply for acquisition.  Market value of the  

land has to  be determined with  reference to  the date  specified in  

clauses  (i)  to  (iii)  of  sub-section  (3)  of  Section  126.   In  terms  of  

proviso to Section 126(2) if  the declaration is not made within one  

year  from the date of  publication of  the draft  regional  plan or  any  

other plan or the scheme, as the case may be, the authority loses the  

right to make such a declaration.  Exception to this is contemplated  

under  Section  126(4)  that  despite  the  above  consequences,  the  

Government  still  has  the  right  to  make  a  fresh  declaration  for  

acquisition of the land subject to the modification that market value of  

the land shall be the market value at the date of declaration in the  

Official Gazette made for acquiring the land afresh.

Section  127  of  the  MRTP  Act  which  deals  with  lapsing  of  

reservation  under  this  Act  stood  amended  vide  Maharashtra  

Amendment Act 16 of 2009.  We have already reproduced above the  

86

amended and unamended provisions of  Section 127 of  the MRTP  

Act.  It is noteworthy that in the unamended provision of Section 127,  

it  was contemplated that if  the proceedings for acquisition of such  

land  under  this  Act  or  under  the  Land  Acquisition  Act  are  not  

commenced within such period, the owner/interested person of any  

land may serve a notice on the planning authority and if within six  

months from the date of the service of such notice, the land was not  

acquired or no steps were taken,  the land shall  be deemed to be  

released from such reservation.  By amendment, the expression ‘if  

proceedings for acquisition of such land under this Act or under the  

Land Acquisition Act’ stood deleted.  This further buttresses the view  

that general reference to the provisions of the Land Acquisition Act  

was intentionally deleted by the Legislature and in its place specific  

reference to the provisions of Section 126(2) or 126(4) of the State  

Act  was made and the period of  six  months was increased to  12  

months.  The legislative intent appears to make the MRTP Act a self-

contained code and does not generally advert to the provisions of the  

Land  Acquisition  Act  for  execution  of  planned  development.   The  

default, its consequences and remedies, thus, have been specifically  

provided for under Section 126 of the MRTP Act and in that regard  

87

there is apparently no need to refer to the default clause contained in  

Section 11A of the Land Acquisition Act.  We have also referred that  

time  limitations  and  consequences  of  their  default  are  specifically  

provided for in the MRTP Act by the Legislature and, therefore, it will  

not be appropriate to read into these provisions something which has  

not  been  stated  by  the  Legislature  on  the  inference  that  time  

limitations  or  bars  created  under  the  Land  Acquisition  Act  would  

essentially have to be read as part of the MRTP Act.   Sections 128  

and  129  of  the  State  Act  are  other  relevant  provisions  which  are  

required to be examined analytically.  Both these provisions refer to  

certain  definite  aspects  of  acquisition  under  the  provisions  of  the  

Land Acquisition Act.  The State Government under Section 128(1) is  

vested with the power of acquiring land under the provisions of the  

Land Acquisition Act  where any land which had been included as  

reserved/designated land for any purpose specified and that land is  

needed for a public purpose different from any such public purpose or  

purpose of the Planning Authority.  The provisions of Section 128(2)  

deal with three different aspects that further reflect the mind of the  

Legislature to restrictively apply the provisions of the Land Acquisition  

Act and even give precedence to the provisions of the MRTP Act vis-

88

à-vis that Land Acquisition Act.  Firstly, the Planning Authority or any  

other authority under the State Act shall be deemed to be a person  

interested  in  the  land  acquired;  secondly  while  determining  the  

amount of compensation to be awarded, the market value of the land  

shall be assessed as if land had been released from the reservation,  

allotment or designation; thirdly, the Collector or the Court shall take  

into consideration the damage, if any, that the authority has suffered  

or may sustain by reason of acquisition of such land under the Land  

Acquisition  Act  or  otherwise  and  proportionate  cost  of  the  

development etc., if any, incurred by the authority for the reason that  

such acquisition  has been rendered abortive.   Section  129 of  the  

MRTP Act relates to exercise of powers for taking possession of the  

land in case of urgency akin to the provisions of Section 17 of the  

Land Acquisition Act.  Proviso to Section 129(1) provides reference to  

payment of compensation to the interested person by the Collector  

for any damage sustained by the person which is caused by such  

sudden dispossession and compensation not excepted in Section 24  

of the Land Acquisition Act and if such offer is not accepted, then it  

shall be allowed in awarding compensation for the said land under  

the provisions of the said Act.   The compensation under the Land  

89

Acquisition Act is to be determined in accordance with the provisions  

of Section 23 while neglecting the matters stated under Section 24 of  

the said Act.  However, the provisions of the State Act in terms of  

Section  128(2)  mandate  that  despite  the  property  being  reserved,  

allotted or designated for a purpose, the same shall be deemed to be  

released  from  such  reservation,  allotment  or  designation  while  

awarding compensation.  This requirement is completely distinct from  

provisions of Section 23 of the Central Act.  In other words, the value  

of  the land acquired shall  not  be diminished because it  has been  

reserved for a particular purpose.  Reference to Section 24 of the  

Central Act is again very specific.  It also needs to be mentioned that  

there are provisions regarding vesting of land in the State/Authority  

but  still  reference  has  been  made  to  Section  16  of  the  Land  

Acquisition Act under Section 128(3) of the State Act. The specific  

reference to provisions of Land Acquisition Act and purpose to be  

achieved is clear from the language of the above-referred provisions  

of the State Act.

In  other  words,  wherever  the  State  Legislature  considered  it  

appropriate, it has made specific reference to a particular provision of  

90

the Land Acquisition Act and for attainment of a particular purpose.  

There is no general reference to the Land Acquisition Act in any of  

the  provisions  of  the  MRTP Act  to  say  that  the  provisions  of  the  

former  Act,  in  their  entirety,  will  be  applicable  to  all  kind  of  

proceedings and purposes under the later Act.  

Another  aspect  which  would  support  the  view  that  it  is  

legislation  by  incorporation  and  there  is  every  legislative  intent  to  

exclude legislation by reference is that wherever there was a general  

reference to the provisions of the Land Acquisition Act like Section  

127  of  the  MRTP  Act,  the  same  stands  excluded/deleted  by  

amendment of 2009.  Furthermore, the entire Land Acquisition Act  

cannot  be  made  applicable  to  proceedings  under  the  MRTP  Act  

where, unlike Land Acquisition Act, the proceedings commence and  

consequences  take  place  the  moment  the  land  is  designated  or  

reserved under a plan, draft plan or even scheme.  On the contrary,  

the  proceedings  under  the  Land  Acquisition  Act  start  when  the  

notification under Section 4 of that Act is issued.  This exclusion is of  

paramount significance as the provisions of the Land Acquisition Act  

relating acquisition would not come into play till the issuance of the  

91

notification under Section 4 thereof while that is not true under the  

MRTP Act.  If the Legislature intended to apply the provisions of the  

Land  Acquisition  Act  generally  and  wanted  to  make  a  general  

reference and implementation of those provisions, it could have said  

that the provisions of the Land Acquisition Act would be applicable to  

the MRTP Act.  Such expression is conspicuous by its very absence.  

Besides the MRTP Act being a self-contained Code, these are  

enactments  which,  apparently,  are  dissimilar  in  their  content  and  

application.  The provisions of Section 127 of the MRTP Act were  

amended long after the amendment of the Land Acquisition Act by  

Central Act 68 of 1984.  The Legislature was fully aware of the entire  

matter  including  hardship  of  the  land  owners.   The  statement  of  

objects and reasons for amendment of Section 127 of the MRTP Act  

conveys  intent  antipodal  to  that  sought  to  be  put  forward  by  the  

appellants,  that  Section 11A of  the Land Acquisition Act would be  

attracted.  Section 11A was in existence at the time of amendment in  

2009 of the MRTP Act and if  it  was intended to be applied to the  

MRTP Act there was hardly any need to amend Section 127 of the  

MRTP Act in the manner in which it was done.  If the intention of the  

92

legislature  was  to  permit  lapsing  of  acquisition,  in  that  event  

provisions of Section 11A of the Land Acquisition Act, per se, would  

have achieved the purpose.  The 2009 amendment to the State Act  

restricted even lapsing of the reservation or designation only if there  

was default  in compliance to the provisions of  Section 126(2) and  

126(4) of the MRTP Act.  General reference to acquisition under the  

Land Acquisition Act was deleted as it was never intended to be read  

as a part of the State Act.  Thus, the State Legislature in its wisdom  

restricted the consequences only to lapsing of reservation.

   Now, let us examine these two settled doctrines with reference  

to judgments of this Court,  particularly, the ones which have been  

relied upon by the learned counsel appearing for the parties.  In the  

case of M/s. Ujagar Prints (supra), a Constitution Bench of this Court  

was dealing with the question whether the Central Excise and Salt  

Act, 1944 which defines the expression ‘manufacture’ as defined in  

Central  Excuse and Salt  Act,  1984 which came to be enlarged by  

amendment  of  the  definition  the  year  1980,  would  apply  to  the  

provisions  of  the  Additional  Duties  of Excise  (Goods  of  Special  

Importance)  Act,  1957  and  whether  such  an  amendment  of  the  

93

Central Excise Act was ultra vires to Entry 84 of List I of Schedule VII  

to  the  Constitution  and,  therefore,  beyond the  competence  of  the  

Parliament.  The Court held as under :

“93.  Referential  legislation  is  of  two  types.  One  is  where  an  earlier  Act  or  some of  its  provisions are incorporated by reference into  a later Act. In this event, the provisions of the  earlier Act or those so incorporated, as they  stand  in  the  earlier  Act  at  the  time  of  incorporation,  will  be read into the later  Act.  Subsequent changes in the earlier Act or the  incorporated provisions will have to be ignored  because,  for  all  practical  purposes,  the  existing  provisions  of  the  earlier  Act  have  been  re-enacted  by  such  reference  into  the  later  one,  rendering irrelevant  what  happens  to the earlier statute thereafter.  Examples of  this  can  be  seen  in  Secretary  of  State v.  Hindusthan  Co-operative  Insurance  Society,   Bolani Ores Ltd. v.  State of Orissa, Mahindra  and Mahindra Ltd. v.  Union of India. On the  other  hand,  the  later  statute  may  not  incorporate the earlier provisions. It may only  make a reference of a broad nature as to the  law on a subject  generally,  as in  Bhajiya v.  Gopikabai, or contain a general reference to  the terms of an earlier statute which are to be  made  applicable.  In  this  case  any  modification,  repeal  or  re-enactment  of  the  earlier statute will  also be carried into in the  later,  for  here,  the  idea  is  that  certain  provisions of an earlier statute which become  applicable in certain circumstances are to be  made use of for the purpose of the later Act  also. Examples of this type of legislation are to  

94

be seen in  Collector of Customs v.  Nathella  Sampathu Chetty, New Central Jute Mills Co.  Ltd. v.  Assistant  Collector  of  Central  Excise  and  Special  Land Acquisition  Officer v.  City  Improvement  Trust. Whether  a  particular  statute falls into the first or second category is  always  a  question  of  construction.  In  the  present case, in my view, the legislation falls  into the second category. Section 3(3) of the  1957 Act does not incorporate into the 1957  Act any specific provisions of the 1944 Act. It  only declares generally that the provisions of  the 1944 Act shall apply “so far as may be”,  that is, to the extent necessary and practical,  for the purposes of the 1957 Act as well.”

Besides deciding this aspect directly with reference to doctrine  

afore-referred,  the  Bench  also  applied  the  doctrine  of  pith  and  

substance.  It held that entries to the Legislative List are not source of  

legislative power,  but  are merely topics or  fields of  legislation and  

must receive a liberal construction inspired by a broad and generous  

spirit  and  not  in  a  narrow pedantic  sense.   The  expression  ‘with  

respect  to’  in  Article  246  brings  in  the  doctrine  of  ‘Pith  and  

Substance’.   In the understanding of the exertion of the legislative  

power and wherever the question of legislative competence is raised  

the  test  is  whether  the  legislation,  looked  at  as  a  whole,  is  

substantially ‘with respect to’ the particular topic of legislation.  If the  

95

legislation has a substantial and not merely a remote connection with  

the entry, the matter may well be taken to be legislation on the topic.

In  the  case  of  M.V.  Narasimhan (supra),  the  Court  while  

applying  the  principle  of  legislation  by  incorporation  had  read  

amendment to Section 21 of the Indian Penal Code defining a ‘public  

servant’  into  the provisions of  Prevention  of  Corruption  Act,  1947.  

The Court clarified that when provisions of a later Act borrowed the  

provisions of the IPC; the same became an integral and independent  

part  of  the  subsequent  Act  and,  therefore,  usually  remained  

unaffected by any repeal or amendment in the previous Act.  But the  

Court, while spelling out the exceptions to the rule of legislation by  

incorporation, had applied one of such exceptions where the reading  

of  the  amended  provisions  of  the  earlier  statute  into  the  later  

enactment  becomes necessary  as non-incorporation thereof  would  

render the subsequent Act wholly unworkable and ineffectual.  The  

significant  dictum  of  the  court  in  this  case  after  noticing  other  

judgments was, “It  seems to be no less logical to hold that where  

certain provisions from an existing Act have been incorporated into a  

subsequent Act, no addition to the former Act, which is not expressly  

96

made  applicable  to  the  subsequent  Act,  can  be  deemed  to  be  

incorporated in it, at all events if it is possible for the subsequent Act  

to function effectually without the addition”.  

In an earlier  judgment of this Court  in the case of  Bajaya v.  

Gopikabai [(1978)  2 SCC 542],  the Court  was concerned with the  

provisions  of  Section  151  of  the  Madhya Pradesh  Land  Revenue  

Code, 1954 which provided that subject to personal law, the interest  

of  the  tenure-holder  shall  on  his  death,  pass  by  inheritance,  

survivorship  or  bequest  as  the  case  may  be.   The  argument  

addressed was that despite the fact that Hindu Succession Act, 1956  

came into force subsequent to the M.P. Land Revenue Code, 1954,  

the expression ‘personal law’ in Section 151 includes the definition in  

the  generic  law  on  the  subject  on  the  basis  of  the  principle  of  

legislation by reference.  The Court, while accepting this argument,  

held that it was well-known that legislature can legislate on a subject  

by  reference  if  the  subject  is  constitutionally  within  its  legislative  

competence and also noticed that there were no words in the Section  

of the Code or elsewhere which limits the scope of the expression  

‘personal  law’  to  that  prevailing  on  February  5,  1955.   On  the  

97

contrary, the words ‘on his death’ used in Section 151 clearly show  

that the legislative intention was that ‘personal law’ as amended up to  

date  on  which  devolution  of  the  tenure-holder’s  interest  is  to  be  

determined, shall be the rule of decision.   

The  distinction  between  these  doctrines  received  a  new  

dimension  founded  upon  a  distinction  between  procedural  and  

substantive provisions of the statute.  In the case of  Sant Joginder  

Singh (supra),  the Court  was concerned with the provisions of the  

MRTP Act amended by the Maharashtra Act 14 of 1971, specially  

failure  to  publish  declaration  within  three  years,  as  was  then  

prescribed under proviso to Section 126(2) of the said Act, and the  

application of provisions of Section 11A of the Land Acquisition Act  

which provided limitation of two years for making award.  Applying the  

principle of distinction between procedural and substantive provisions  

of  the statute,  the Court  came to the conclusion that  Section 11A  

cannot be read into the provisions of the MRTP Act and rejected the  

argument as the provisions of Section 23 of the Central Act have to  

be applied  for  determining  compensation,  Section  11A would also  

automatically  apply.   The  Court  found  that  Section  11A  was  a  

98

procedural  provision while  Section  23 was a substantive  provision  

and held, “So, merely because Section 23 of the Central Act would  

apply to acquisition under the State Act, it is not enough to hold that  

what is contained in Section 11A would also apply”.  Even, the earlier  

judgments of this Court have taken the view that as the statutes like  

the present one do not contain specific procedure for determination of  

compensation payable for acquisition, the provisions of Section 23 of  

the  Land  Acquisition  Act  may  be  attracted.   In  the  case  of  Land  

Acquisition  Officer v.  H.  Narayanaiah [(1976)  4  SCC  9],  wherein  

Section  27  of  the  Bangalore  City  Improvement  Trust  Act,  1945  

referred to the provisions of the Land Acquisition Act insofar as they  

are  applicable,  in  absence  of  there  being  a  specific  provision  for  

computation of compensation, provisions of Section 23 of the Land  

Acquisition  Act  were  held  to  be  applicable  by  a  Bench  of  three  

Judges of this Court.

In  the case of  Gauri  Shankar  Gaur (supra),  a  Bench of  two  

Judges  of  this  Court  took  divergent  view  while  dealing  with  the  

challenge to the validity of Section 55 read with the Schedule to the  

U.P. Avas Evam Vikas Parishad Adhiniyam, 1965 which provided that  

99

the provisions of the Land Acquisition Act would apply in the matter of  

acquisition of land for the purpose of the Adhiniyam.  One view was  

that the provisions of the Adhiniyam and the provisions of the Land  

Acquisition  Act  both  co-existed  independently  in  relation  to  the  

procedure prescribed under the respective Acts without, in any way,  

one colliding with the other.  Thus, Section 55 and the Schedule did  

not become void.  Justice K. Ramaswamy (as he then was) held that  

the  limitation  of  three  years  prescribed  under  the  first  proviso  to  

Section  6  of  the  Land  Acquisition  Act  was  not  attracted,  in  its  

application, to the State of U.P. vis-à-vis the procedure prescribed in  

paragraph 2 of the Schedule to the Act read with Section 55 of the  

Act.   In  other  words,  the  bar  of  limitation  contained  in  the  Land  

Acquisition Act would not apply.   Justice R.M. Sahai’s (as he then  

was) view was that in absence of express exclusion, it  is more in  

interest of justice to hold that the restrictions of three years added by  

the proviso to Section 6 should be applied to the later Act.  Any effort  

to demonstrate impossibility of completing proceedings within three  

years  cannot  be  countenanced.  Legislative  intention  cannot  be  

frustrated by executive inaction.  The acquisition proceedings were,  

therefore, to come to an end after expiry of three years from the date  

100

of  issuance  of  notification  under  the  provisions  of  the  UP  Act  

analogous to Section 4 of the Land Acquisition Act.  Thus, there was  

difference of opinion on this question of law between the Judges of  

the  same  Bench.   Since  the  appeal  was  dismissed  on  different  

grounds by both  the  learned Judges,  the  matter  remained at  that  

stage.   

The above dissent led to reference of the legal issue to a three  

Judge Bench in the case of U.P. Avas Evam Vikas Parishad (supra)  

where the Court took the view that the acquisition effected under the  

provisions  of  U.P.  Avas  Evam  Vikas  Parishad  Adhiniyam,  1965,  

where Section 55 read with the Schedule of  that  Act  adopted the  

provisions of the Land Acquisition Act, such adoption was held to be  

legislation  by reference and,  therefore,  the  land owners would  be  

entitled to the benefits of Sections 23(1A), 23(2) and 28 as introduced  

by the Central Act 68 of 1984 as otherwise it would suffer from the  

vice  of  arbitrariness  and  hostile  discrimination.   This  Court  while  

dealing with the provision of Section 55 of the Adhiniyam held that the  

provisions of the Land Acquisition Act as amended by the Central Act  

68 of 1984, relating to determination and payment of compensation,  

101

would  be  applicable  to  acquisition  of  land  for  the  purposes  of  

Adhiniyam.   

The  principle  of  legislation  by  incorporation  as  stated  in  

Hindusthan  Co-operative  Insurance  Society  Ltd.  (supra)  had  been  

followed in subsequent cases as well.  It was clearly stated that in the  

case of legislation by incorporation, it is a statute existing at that time  

which stands incorporated in the later law to the extent it is adopted  

by the legislature and subsequent amendments are inconsequential  

for implementation of the law contained in the subsequent Act.  Even  

in the case of  Bolani Ores Ltd. (supra), the Court while dealing with  

the definition of ‘motor vehicle’ in Section 2(18) of the Motor Vehicles  

Act, 1939  and Section 2(c) of the Bihar and Orissa Motor Vehicles  

Tax  Acts,  1930  held  that  the  amendment  to  Section  2(18)  of  the  

Motor Vehicles Act by Act 100 of 1956 could not be read into the  

Bihar  Act,  as  the  legislature  had  intended  to  incorporate  the  

provisions of the Motor Vehicles Act as it stood in 1939.   

These are the few examples and principles stated by this Court  

dealing with both the doctrines of legislation by incorporation as well  

as by reference.  Normally,  when it  is by reference or citation, the  

102

amendment to the earlier law is accepted to be applicable to the later  

law while in the case of incorporation, the subsequent amendments  

to the earlier law are irrelevant for application to the subsequent law  

unless  it  falls  in  the  exceptions  stated  by  this  Court  in  M.V.  

Narasimhan’s case (supra).   It  could well  be said that even where  

there is legislation by reference, the Court needs to apply its mind as  

to what effect the subsequent amendments to the earlier law would  

have on the application of the later law.  The objective of all these  

principles of interpretation and their application is to ensure that both  

the Acts operate in harmony and object of the principal statute is not  

defeated by such incorporation.  Courts have made attempts to clarify  

this distinction by reference to various established canons.  But still  

there are certain grey areas which may require the court to consider  

other  angles  of  interpretation.   In  the  case  of  Maharashtra  SRTC  

(supra), the court was considering the provisions of the MRTP Act as  

well as the provisions of the Land Acquisition Act.  The Court finally  

took the view by adopting the principle stated in  U.P. Avas Evam  

Vikas Parishad (supra) and held that there is nothing in the MRTP Act  

which precludes the adoption of the construction that the provisions  

of  the Land Acquisition Act as amended by the Central  Act  68 of  

103

1984, relating to award of compensation would apply with full vigour  

to the acquisition of land under the MRTP Act, as otherwise it would  

be  hit  by  invidious  discrimination  and  palpable  arbitrariness  and  

consequently invite the wrath of Article 14 of the Constitution.  While  

referring to the principle stated in the case of Hindusthan Cooperative  

Insurance Society Ltd. (supra) and clarifying the distinction between  

the two doctrines, the Court declined to apply any specific doctrine  

and primarily  based its  view on the plea  of  discrimination  but  still  

observed. :

“8. … The fact that no clear-cut guidelines or  distinguishing features have been spelt out to  ascertain  whether  it  belongs  to  one  or  the  other category makes the task of identification  difficult.  The  semantics  associated  with  interpretation play their role to a limited extent.  Ultimately,  it  is  a  matter  of  probe  into  legislative  intention  and/or  taking  an  insight  into the working of the enactment if one or the  other  view  is  adopted.  The  doctrinaire  approach to ascertain whether the legislation  is by incorporation or reference is, on ultimate  analysis,  directed  towards  that  end.  The  distinction often pales into insignificance with  the exceptions enveloping the main rule.”

In the case in hand, it  is clear that both these Acts are self-

contained  codes  within  themselves.   The  State  Legislature  while  

104

enacting the MRTP Act has referred to the specific sections of the  

Land Acquisition Act in the provisions of the State Act.  None of the  

sections require application of the provisions of the Land Acquisition  

Act generally or mutatis mutandis.  On the contrary, there is a specific  

reference to certain sections and/or content/language of the section  

of  the  Land  Acquisition  Act  in  the  provisions  of  the  MRTP  Act.  

Section 113A of the State Act refers to acquisition of land under the  

Land Acquisition Act for the purpose under Section 113(3A) which in  

turn refers to the complexity and magnitude of the work involved in  

developing any area as a site for new town.  Section 116 of the State  

Act refers to the power which shall  vest in a Developing Authority,  

constituted under Section 113(2) of the MRTP Act, for acquisition by  

agreement or under the Land Acquisition Act, as provided in Chapter  

VII of the MRTP Act.  Section 125 of the State Act provides that any  

land which is required, reserved or designated in a regional plan or a  

scheme for  a  public  purpose,  which  shall  be  deemed  to  be  land  

needed  for  a  public  purpose  within  the  meaning  of  the  Land  

Acquisition Act.  Section 126(1)(b) provides for payment of an amount  

equivalent to the value of lessor’s interest to be determined by the  

authorities  on  the  basis  of  the  principles  laid  down  in  the  Land  

105

Acquisition Act.  Thus, the reference to the provisions of the Land  

Acquisition  Act  is  only  for  the  purpose  of  adopting  the  principles  

stated  therein  for  a  very  limited  purpose.   In  terms  of  Section  

126(1)(c) of the MRTP Act, the application to the State Government  

has to be made for acquiring such land under the Land Acquisition  

Act.  Such land refers to the lands which are required only under the  

provisions of the MRTP Act.  Section 126(2) refers to Section 6 of the  

Land  Acquisition  Act  only  for  the  purpose  of  format  in  which  the  

declaration  has  to  be  made.   In  terms  of  Section  126(3),  on  

publication  of  the  declaration,  the  Collector  shall  proceed  to  take  

order  for  acquisition  of  the  land  under  the  State  Act,  i.e.  for  the  

purpose of acquisition of land; the procedure adopted under the Land  

Acquisition Act shall be adopted by the Collector and nothing more.  

The afore-referred provisions of the State Act clearly frame a scheme  

for  planned development  with  limited incorporation of  some of  the  

provisions of the Land Acquisition Act.  The provisions of the State  

Act  were  amended  last  in  point  of  time  and,  therefore,  the  State  

Legislature was aware of the relevant existing laws including Section  

11A of  the  Land  Acquisition  Act.   The intent  of  the  legislature  to  

exclude the application of Section 11A clearly emerges from the fact  

106

that  while  amending  Section  127  of  the  MRTP  Act,  it  made  no  

reference,  generally  or  specifically,  to  the  said  provision  rather  it  

deleted reference to the provisions of the Land Acquisition Act from  

the unamended provisions of Section 127. Reference to Section 16 of  

the Land Acquisition Act in the State Act, under Section 128(3) of the  

State Act, is again relatable to the acquisition proceedings under the  

Land Acquisition Act, as under Section 83 of the State Act, the land  

could vest in the Planning Authority even at the threshold and it is  

vesting of a different kind than contemplated under Section 16 of the  

Land Acquisition Act.  The purpose and intent of Section 129 of the  

MRTP  Act  is  akin  to  the  provisions  of  Section  17  of  the  Land  

Acquisition Act and from linguistic point of view, there is similarity in  

the two Sections but still the State Act has provided for a complete  

scheme with regard to possession and compensation payable to the  

owner of the land in cases of urgency.  Thus, it is clear that there is  

no general reference to the provisions of the Land Acquisition Act and  

they shall not apply as such or even mutatis mutandis to the MRTP  

Act.  On the contrary, reference to the Central Act, wherever is made  

in the State Act, is specific and for a definite purpose.

107

Another  argument  which had been vehemently  advanced on  

behalf of the appellant is that the reference to the provisions of the  

Land Acquisition Act in different provisions of the MRTP Act would  

require that the proceedings commence from Section 6 of the Central  

Act onwards and award is made in terms of Section 11 of that Act  

and as  those provisions  apply  to  these  proceedings,  Section  11A  

would automatically come into play so would the other provisions of  

the  Land  Acquisition  Act.   The expression  ‘under  the  said  Act’  in  

Section 126(3) of  the MRTP Act is  sufficient  indication that  it  is  a  

legislation by reference and, thus, all subsequent amendments would  

apply.  It was also contended that on a bare reading of Sections 126  

and 127 of  the MRTP Act,  it  is  clear  that  it  does not  exclude the  

application of Section 11A of the Land Acquisition Act.  We certainly  

are  not  impressed  by  this  argument  advanced  on  behalf  of  the  

appellants.  Firstly, if we examine the acquisition proceedings under  

the Land Acquisition Act,  they commence only when a notification  

under Section 4 of the Land Acquisition Act is issued.  Section 5A of  

the  Central  Act  makes  it  incumbent  upon  the  authorities  to  invite  

objections  and  decide  the  same  before  issuing  declaration  under  

Section 6 of the Land Acquisition Act.  All these proceedings have  

108

specifically  been  given  a  go-by  under  the  MRTP  Act,  where  

notification  is  to  be  issued  under  Section  126(2)  in  the  manner  

provided  under  Section  6  of  the  Land Acquisition  Act.   Secondly,  

specific reference to various sections of the Land Acquisition Act in  

the  MRTP Act  necessarily  implies  exclusion  of  the  provisions  not  

specifically mentioned therein.  Lastly, acquisition proceedings under  

the MRTP Act are commenced by issuance of a declaration under  

Section 126(2) and then the procedure prescribed under the Land  

Acquisition Act is followed upto passing of award under Section 11 of  

that Act.  Further, determination of compensation will again depend  

upon  the  principles  stated  in  Sections  23  and  24  of  the  Land  

Acquisition  Act  but  subject  to  Sections  128(2)  and  129(1)  of  the  

MRTP Act.  Statutory benefits accrued under Sections 23(1A), 23(2)  

and 28 of the Land Acquisition Act would be applicable as held by  

this Court in U.P. Avas Evam Vikas Parishad (supra).  Vesting, unlike  

Section 16 of the Land Acquisition Act which operates only after the  

award is made and compensation is given, whereas under the MRTP  

Act  it  may operate  even at  the  initial  stages before making of  an  

award, for example, under Sections 126(1)(c) and 83.  While referring  

to Section 6 of the Land Acquisition Act, the State Legislature has not  

109

adopted, specifically or otherwise, the period mentioned in proviso to  

Section 6(1) of the Land Acquisition Act.  On the contrary, different  

time frames have been postulated under different provisions of the  

MRTP Act.   If  those limitations of  time are not  adhered to by the  

concerned authorities,  the consequences have also been provided  

therefor.  From the stage of initiation of steps for preparation of draft  

plans to the finalization of  the scheme, it  takes considerable time.  

Furthermore, its implementation at the ground level, takes still much  

more time.  If  this entire planned development which is a massive  

project is permitted to lapse on the application of Section 11A of the  

Central  Act,  it  will  have  the  effect  of  rendering  every  project  of  

planned development frustrated.  It can hardly be an argument that  

the  Government  can  always  issue  fresh  declaration  in  terms  of  

Section 6 of the Land Acquisition Act and take further proceedings.  

Recommencement of acquisition proceedings at different levels of the  

hierarchy of the State and Planning Authority itself takes considerable  

time and,  thus,  it  will  be  difficult  to  achieve  the  target  of  planned  

development.  This clearly demonstrates that all the provisions of the  

Land Acquisition Act introduced by later amendments would not, per  

se, become applicable and be deemed to be part and parcel of the  

110

MRTP Act.  The intent of the legislature to make the State Act a self-

contained Code with definite reference to required provisions of the  

Land Acquisition Act is clear.

Besides this, another very important aspect of the present case  

is that if the provisions of Section 11A of the Land Acquisition Act are  

applied or deemed to be incorporated by application of any doctrine  

of  law into  the  provisions  of  MRTP Act,  it  will  have  the  effect  of  

destroying  the  statutory  rights  available  to  the  State  Government  

and/or  the  Planning  Authority.   For  instance,  proviso  to  Section  

126(2)  of  the  State  Act  provides  that  where  a  declaration  in  the  

manner provided in Section 6 of the Land Acquisition Act in respect of  

the said land is not made within one year from the date of publication  

of draft regional plan, thereafter no such declaration shall be made.  

Section 126(4) makes an exception to the consequences stated in  

proviso to Section 126(2) that the State Government, notwithstanding  

those provisions, can make a fresh declaration for acquiring the land  

under  the Land Acquisition Act.  However,  the market  value of  the  

land shall be the market value at the date of declaration in the Official  

Gazette made for acquiring such land afresh. In other words, the rest  

111

of the machinery provided under the Act would not operate after the  

prescribed period.  However, in terms of Section 127 of the MRTP  

Act,  if  any  land  reserved,  allotted  or  designated  for  any  purpose  

specified is not acquired by agreement within 10 years from the date  

on which final  regional  plan or  final  development  plan comes into  

force or if a declaration under sub-sections (2) or (4) of Section 126 of  

the MRTP Act  is  not  published in  the Official  Gazette within  such  

period,  the owner or  any person interested in the land may serve  

notice upon such authority to that effect and if within 12 months from  

the date of  service of  such notice,  the land is  not  acquired or  no  

steps,  as  aforesaid,  are  commenced  for  its  acquisition,  the  

reservation, allotment or designation shall be deemed to have lapsed  

and the land would become available to the owner for the purposes of  

development.  The defaults, their consequences and even exceptions  

thereto have been specifically stated in the State Act.  For a period of  

11 years, the land would remain under reservation or designation, as  

the case may be, in terms of Section 127 of the MRTP Act(10 years +  

notice  period).   However,  if  the  provisions  of  Section  11A  of  the  

Central Act were permitted to punctuate a scheme of the State Act  

and  the  award  is  not  made  within  two  years  from  the  date  of  

112

declaration  under  Section  6  of  the  Central  Act,  the  acquisition  

proceedings will lapse which will frustrate the rights of the State as  

well  as  the  scheme  contemplated  under  Section  126  as  well  as  

Section 127 of the State Act and that would not be permissible in law.  

This being legislation by incorporation, the general reference to the  

provisions of the Land Acquisition Act shall stand excluded.

While applying any of the doctrines, the Court will have to take  

care that there is no distortion or destruction of the provisions of the  

principal statute.  For examining this aspect, it really would not matter  

whether  we apply the doctrine of incorporation or reference to the  

facts of the present case.  It will have to be examined on the touch  

stone of effective and complete workability while protecting legislative  

intent.   Primarily,  we  have  to  examine  whether  incorporating  

provisions  of  Section  11A  of  the  Land  Acquisition  Act  into  the  

provisions of MRTP Act by reference would disturb the scheme of the  

MRTP Act and cause legal and practical impediments in execution of  

this  Act.   Section 126(2)  of  the State Act  refers  to  the manner of  

declaration as contemplated under Section 6 of the Land Acquisition  

Act but the legislature intentionally avoided making any reference to  

113

other features contained in Section 6 of the Central Act as well as the  

time frame prescribed under that Act.   On the contrary,  proviso to  

Section  126(2)  of  the  MRTP  Act  spells  out  its  own  time  frame  

whereafter such declaration cannot be made subject to the provisions  

of Section 126(4).  The unamended provisions of Section 127 of the  

State Act though refer to the acquisition under Land Acquisition Act  

but without making any reference to the time frame prescribed under  

the said Act.  In  this  Section also,  the specific  time frame and the  

consequences of default thereof have been stated.  Sections 128 and  

129 of the MRTP Act relate to acquiring land for the purpose other  

than for which it is designated in any plan or scheme and taking of  

possession  of  land  in  cases  of  urgency  respectively.   The  Court  

cannot lose sight of one very important fact that the MRTP Act is an  

Act relating to planned development and acquisition is an incidental  

aspect thereof.  Planned development is quite different from merely  

‘achieving a public purpose’ for which the land is acquired under the  

provisions of the Land Acquisition Act.  Development plan, Regional  

Plan and town planning scheme are major events in the development  

of  a  State.   They are  controlled  and guided by  different  financial,  

architectural and public interest for the development including macro  

114

and micro planning of  the entire State.   The provisions relating to  

planned  development  of  the  State  or  any  part  thereof,  read  in  

conjunction with the object of the Act, show that different time frames  

are required for initiation, finalization and complete execution of such  

development plans. The period of 10 years stated in Section 127 of  

the  MRTP  Act,  therefore,  cannot  be  said  to  be  arbitrary  or  

unreasonable ex facie.  If the provisions of Section 11A of the Land  

Acquisition  Act,  with  its  serious  consequence  of  lapsing  of  entire  

acquisition proceedings, are bodily lifted and read into the provisions  

of MRTP Act, it is bound to frustrate the entire scheme and render it  

ineffective  and  uncertain.   Keeping  in  view  the  consequence  of  

Section 11A of the Central Act, every development plan could stand  

frustrated only for the reason that period of two years has lapsed and  

it will tantamount to putting an end to the entire development process.  

Another reason for rejecting the contention of the appellants is that  

for the full and complete implementation of the scheme de hors such  

reservation, allotment and designation, lands have to be acquired and  

once acquisition as argued, fails on the application of Section 11A of  

the Central Act, those lands would have to be restored to the owners  

while  lands  of  other  plot  owners  under  the  same  scheme  would  

115

continue to be under reservation, allotment or designation.  Even this  

would render the scheme unworkable. If the legislature has opted not  

to introduce any such limitation in the MRTP Act, then to read the  

same with  reference to  the provisions of  the Land Acquisition Act  

would  be  unjust  and  render  the  scheme  under  the  State  Act  

completely unworkable.  That certainly  is not  the legislative intent.  

Thus, in our view, reading of Section 11A of the Land Acquisition Act  

into  Chapter  VII  of  the  MRTP  Act  will  render  the  substantive  

provisions of the State Act ineffective, unworkable and may frustrate  

the object of the Act materially.  

One of the pertinent  principles that the Court  should keep in  

mind while applying referential legislation as a tool of interpretative  

application is that such interpretation should not, in any way, defeat  

the object and essence of principal legislation.  The likelihood of any  

interference with the scheme under the principal Act would tilt against  

accepting such an interpretation.  

Counsel  appearing  for  the  appellant  strenuously  argued with  

the  aid  of  equitable  principles  that  the  judicial  discretion  while  

referring to such statutes should tilt in favour of the owners of the land  

116

rather than in favour of the State which in any case is exercising its  

power of eminent domain.  The contention is that Section 11A of the  

Land Acquisition Act should be read into the MRTP Act on equitable  

grounds, as that alone will balance the rights of the citizens vis-à-vis  

right  of  the State.   In other words,  if  a declaration is made under  

Section 126(2) of the State Act in the manner specified under Section  

6 of the Central Act but consequently an award is not made within  

two  years  of  such  declaration,  then  the  acquisition  and  all  

proceedings thereafter would lapse in terms of Section 11A of the  

Central Act.  It was pressed that if this contention is not accepted,  

great injustice will be caused to the appellants inasmuch as they will  

have to wait for years together for finalization of the proceedings and  

10 years,  in  any case,  is  an unduly  long period.   Per contra, the  

respondents argue that induction of Section 11A into the MRTP Act  

would hamper the scheme and would frustrate its object.   

We  find  no  merit  in  the  contention  raised  on  behalf  of  the  

appellants.   The  Court  cannot  lose  sight  of  the  fact  that  the  

acquisition of land for planned development under the MRTP Act may  

be completed much prior to the time frame stipulated under Sections  

117

126 and 127 of that Act.  Once the acquisition is complete and land is  

vested in the State, the person interested ceases to have any interest  

in  the  land  in  question.   Even  for  variety  of  other  reasons,  this  

contention cannot be accepted. Firstly, the provisions of the MRTP  

Act do provide for time limitation as well as the consequences in the  

event  of  default.  Secondly,  wherever  there  is  delay,  despite  such  

framework  provided  under  the  MRTP Act,  the  applicants  are  duly  

compensated  by  payment  of  compensation.   If  the  provisions  of  

Section 11A of the Land Acquisition Act are read and enforced stricto  

sensu in  the  MRTP  Act,  inevitable  consequences  would  be  that  

various development schemes under the MRTP Act would come to a  

halt and the larger public interest would suffer.  On the other hand,  

some  inconvenience  may  be  caused  to  the  owners/interested  

persons of the land by non-induction of provisions of Section 11A of  

the  Central  Act.   Thus,  private  interest  would  suffer  which,  in  

comparison to larger public interest, can hardly be a consideration for  

accepting the contention raised on behalf  of  the appellant.   It  has  

been held by various judgments of this Court and rightly so that the  

provisions of Sections 23(1A), 23(2) and 28 of the Land Acquisition  

Act which relate to payment of interest and solatium with regard to  

118

the amount of compensation determined under the award made by  

the  Collector  under  Section  11  of  that  Act,  is  an  adequate  

compensation to the appellants for the delay which may be caused by  

the Government due to avoidable and/or unavoidable circumstances.  

On  the  contrary,  if  acquisition  and  all  proceedings  thereafter  are  

permitted to lapse in terms of Section 11A of the Land Acquisition  

Act, the development plans which may have already commenced or  

even progressed may come to a standstill causing huge damage to  

the public interest as well as to the State Revenue which, ultimately,  

is nothing but public funds.  This is more so for the reason that the  

lands  come under  a  reservation,  designation  as  land  required  for  

plans including township even when the draft plans are prepared and  

approved by the State.  From whatever point of view this is examined,  

it is not possible to read the provisions of Section 11A of the Land  

Acquisition Act into the MRTP Act without adversely affecting the very  

object of the MRTP Act and causing impediments, legal or otherwise,  

in the implementation of the development plans.  These Acts operate  

in  different  fields  and  such  incorporation  by  reference  would  be  

incompatible with the cause of the MRTP Act, particularly, when the  

reference to the provisions of the Land Acquisition Act are, primarily,  

119

for achieving the purpose of the MRTP Act.

Various judgments of this Court, which have been relied upon  

by the learned counsel appearing for the respective parties, appear to  

have taken the view that doctrine of legislation by reference would  

ipso  facto include  all  the  prospective  amendments  to  the  earlier  

statute into the later statute.  Further, it was contended that this rule  

of legislation by reference is a rule to which, so far, no exceptions  

have  been  carved  out  like  those  to  the  principle  of  legislation  by  

incorporation as provided in the case of  M.V. Narasimhan (supra).  

However,  during  the  course  of  hearing,  all  the  learned  counsel  

appearing for the respective parties contended and fairly stated that  

the rule of legislation by reference too can have exceptions though to  

a limited extent.  Having perused and analyzed the various judgments  

cited at the Bar we are of the considered view that this rule is bound  

to have exceptions and it cannot be stated as an absolute proposition  

of  law  that  wherever  legislation  by  reference  exists,  subsequent  

amendments to the earlier law shall stand implanted into the later law  

without analyzing the impact of such incorporation on the object and  

effectuality of the later law.  The later law being the principal law, its  

120

object, legislative intent and effective implementation shall always be  

of paramount consideration while determining the compatibility of the  

amended prior law with the later law as on relevant date. It will  be  

useful to apply the ‘test of intention’ and ‘test of unworkability’ with  

their  respective  contextual  reference  while  determining  the  

applicability of either of the doctrines and for that matter, even on the  

applicability of the amended law to the later law. Impact analysis on  

the  workability  of  the  respective  legislation  shall  be  a  relevant  

consideration for  resolving such an issue.  There can be instances  

where the amended law, if applied and treated as incorporated in the  

principal legislation, may be apparently unadjustable to the scheme of  

that legislation. In that circumstance, it will be unfair to interpret the  

amended  law  as  deemed  to  be  incorporated,  irrespective  of  its  

consequences  on  the  implementation  of  the  provisions  of  the  

principal  Act.  It  is  emphasized that  the  object  of  the  principal  Act  

should not be permitted to be defeated on the basis of either of the  

doctrines  above  referred.   Hence,  there  is  need  for  carving  out  

exceptions to the rule of legislation by reference as well.  Examples  

where such reference would be impermissible are as follows :

121

a) Legislation by reference should not  result  in defeating the  

object and purpose of the later Act;

b) Where the amendments to the earlier law are read into the  

subsequent law as a result of legislation by reference, if the  

result  is  irresolvable  conflict  between their  provisions or  it  

results  in  destroying  the  essence  and  purpose  of  the  

principal Act (later law).

The above exceptions to the doctrine are not exhaustive but are  

merely indicative.  The possibility of other exceptions to this doctrine  

cannot be ruled out as it  is difficult  for this Court  to state all  such  

exceptions  with  precision.   Furthermore,  defining  such  exceptions  

with exactitude will not even aid the ends of justice.  We have already  

noticed that all the learned counsel appearing for the parties are ad  

idem that it would be necessary to carve out such exceptions to apply  

the doctrine appropriately, advantageously and objectively.   

Synoptic analysis of the stated doctrines leads us to conclude  

that it is a case of legislation by incorporation.  The reference to the  

provisions of the Central Act is specific as opposed to general.  The  

State Act uses similar but definite language and expressions while  

122

referring to the provisions of the Central Act indicating the intent of  

the legislature not to adopt or even apply the provisions of the Central  

Act generally.  This premise clearly is more than suggestive of the  

animus  imponentis to  exclude  the  application  of  the  provisions  of  

Central  legislation  prescribing  time  frame  and  consequences  of  

default  thereof to the State Act.  It  will  give rise to an irresolvable  

conflict amongst the provisions of the two legislations if provisions like  

Section 11A of the Land Acquisition Act are to be read into the State  

law.  Even if the contention advanced by the appellant is accepted,  

for the sake of argument, it will still fall within the exceptions stated  

(supra)  to  the  principle  of  legislation  by  reference.   Reading  such  

provisions into the State law would result in destroying the essence  

and effective implementation of the State law.  We have discussed  

the above plea in regard to referential  legislation as an alternative  

argument  addressed  by  the  learned  counsel  for  the  respective  

parties.  While holding that it is a case of legislation by incorporation,  

we  still  are  of  the  considered  view  that  some  of  the  amended  

provisions of the Central Act would be applicable to the State Act or  

read  as  a  part  thereof,  with  reference  to  the  doctrine  of  pith  and  

substance  and  harmonious  application  of  the  statutes.  These  

123

principles we shall shortly proceed to discuss.

Harmonious Application

           Having analyzed the niceties of the doctrines and principles of  

law at  some length,  let  us now proceed to examine whether both  

these  statutes,  being  self-contained  codes  in  themselves,  can  be  

applied harmoniously to achieve the object of the State Act without  

any conflict, with particular reference to acquisition proceedings. As it  

is  not  always  necessary  for  the  Courts  to  examine  conflict  or  

inconsistency between the two statutes,  one enacted by the State  

and other by the Centre, in such situation one Act itself may afford  

the  key  to  the  solution  of  the  problem,  which  may  relate  to  

construction of the provisions of the statute.  The Central law can be  

applied to the State law for a purpose and with such adjustments as  

may be contemplated under the relevant law.  In the case of  Patna  

Improvement Trust v. Smt. Lakshmi Devi [AIR 1963 SC 1077],  the  

majority of the four Judge Bench took such a view and held as under:

“5. It is not necessary to go into the argument  of  inconsistency  between the  Bihar  Act  and  the  Land  Acquisition  Act  or  the  special  Act  excluding the general  because it  appears to  us that the various provisions of the Bihar Act  

124

themselves afford  the key to  the solution of  the  problem  before  us  which  is  one  of  construction.   Section  71  of  the  Bihar  Act  which modifies the Land Acquisition Act, itself  states  that  for  the  purpose  of  acquisition  of  land for the Trust under the Land Acquisition  Act,  that  Act  (Land Acquisition Act)  shall  be  subject  to  the  modification  specified  in  the  Schedule. Therefore even for the purpose of  acquiring land for the Trust the machinery of  the  Land  Acquisition  Act  as  modified  is  contemplated.  It  does not exclude the Land  Acquisition  Act,  on  the  contrary  it  makes  it  applicable but subject to its modifications and  exceptions...”

The  Court  has  to  keep  in  mind  the  clearly  stated  legal  

distinction  between reservation  and  designation  on  one  hand  and  

acquisition on the other.  These are well defined terms used by the  

Legislature  in  both  the  enactments  and  they  do  not  admit  any  

synonymity or interchangeability.  The reservation under the MRTP  

Act  necessarily  may  not  mean  and  include  acquisition.   The  

acquisition under the Land Acquisition Act may not necessarily mean  

and include reservation.  They are well explained concepts within the  

legislative scheme of the respective Acts.  It may not be necessary at  

all for an appropriate authority to always acquire the entire or part of  

the land included in the planned development,  while there may be  

125

cases  where  the  land  is  acquired  for  the  purpose  of  completing  

planned development.   With this  distinction in  mind,  let  us,  again,  

refer to some of the relevant provisions of both the enactments. Once  

the  notification  under  Section  126(2)  of  the  MRTP  Act  has  been  

issued  in  the  manner  prescribed  under  Section  6  of  the  Land  

Acquisition Act,  the mechanism stated under the provisions of  the  

Land  Acquisition  Act,  for  the  limited  purpose  of  acquisition  and  

determination of compensation, would be read into the State Act.  It is  

provided under the provisions of the State Act that the Collector shall  

take order in terms of Section 126(3) for acquisition of the land after  

declaration under Section 126(2) has been issued.  The provisions of  

Section  126(3)  of  the  MRTP  Act  are  similar  to  the  provisions  of  

Section  7  of  the  Land  Acquisition  Act.   Thereafter,  the  authority  

responsible for initiating the acquisition proceedings is expected to  

comply with the provisions of Sections 9 and 10 and finally make an  

award under  Section  11  of  the  Central  Act.   With  passing  of  the  

award,  the  first  phase  of  proceedings  for  acquisition  is  complete.  

Undue delay in completion of proceedings was a matter of concern  

both  before  the  Parliament  and  the  State  Legislature  when  the  

respective  Acts  were  amended.   This  had  led  to  introduction  of  

126

certain beneficial provisions in the Land Acquisition Act which were  

intended to give additional benefits by way of interest and solatium to  

the  owner/interested  person  in  the  land  on  account  of  delay  in  

completion of such proceedings.  These are Sections 23(1A), 23(2)  

and 28 of the Land Acquisition Act which are in consonance with the  

scheme  of  the  State  Act  and  in  no  way  obstruct  the  planned  

development, rather they ensure proper balance between private and  

State interest by granting just and fair compensation to the claimants.  

A three Judge Bench of this Court in the case of  U.P. Avas Evam  

Vikas  Parishad  (supra),  has  already  taken  the  view  that  these  

provisions are to be applied while determining compensation payable  

for acquisition of land and we see no reason to differ with the view  

taken.  The State Act does not provide for any specific machinery for  

determination of compensation and rights of the claimants when an  

award  is  made.   Again,  to  this  extent,  recourse  to  provisions  of  

Section 18 of the Land Acquisition Act for making a reference to the  

Court  of  competent  jurisdiction  at  the  behest  of  owner/interested  

person as well as provisions of appeal to the High Court would be  

attracted  as  the  remedy  available  to  the  claimant.   Of  course,  

compensation  would  have  to  be determined  with  reference  to  the  

127

principles stated under Sections 23 and 24 of the Land Acquisition  

Act  which have been made applicable by judicial  pronouncements  

but,  again,  subject to the restrictions stated under Sections 128(2)  

and 129 of the State Act.  The provisions of Section 72 of the MRTP  

Act require determination of disputes referred to in that section by the  

Arbitrator.  The jurisdiction and powers of the Arbitrator as well as of  

the Tribunal under Section 74 of the State Act have a very limited  

scope.  The Arbitrator can only adjudicate the disputes which strictly  

fall within the ambit of his jurisdiction under Section 72(3) clauses (i)  

to (xviii) of the State Act.  Clauses (iii) and (iv) of Section 72(3) of the  

MRTP Act provide for fixation of value and difference between the  

values of the ‘original plots’ and the ‘final plots’ as well as estimating  

the compensation payable for the loss of the area of the ‘original plot’  

in  accordance  with  the  provisions  contained  in  clause  (f)  of  sub-

section (1) of Section 97 of the MRTP Act which deals with cost of a  

town planning scheme.  This adjudicatory power is in relation to the  

‘plots’ as defined under Section 2(21), in distinction to compensation  

payable  for  acquired  ‘land’  as  defined  under  Section  2(14)  of  the  

State Act.  The provisions of Sections 72 and 74 of the MRTP Act  

grant specific power and jurisdiction to the Arbitrator and the Tribunal  

128

respectively.  None of these provisions deal with the concept of land  

acquisition and payment of compensation in terms of the Central Act  

which the State legislature has specifically  provided by devoting a  

complete chapter to acquisition (Chapter VII) in the State Act.   It is  

also pertinent to note that predominantly the provisions of the State  

Act relate to planned development.  The provisions of Chapter V(b)  

with particular reference to Sections 72, 73 and 82 to 86 of the State  

Act  are  another  pointer  towards  the  limited  jurisdiction  of  the  

Arbitrator.   The  principal  role  of  the  Arbitrator  is  relatable  to  the  

events occurring between finalization of draft plan to approval of the  

final  scheme,  under  the  provisions  of  the  Act,  and  the  disputes  

connected thereto.

Another  very  specific  power  vested  in  the  Arbitrator  is  

performance of the functions attributed to it under Section 83 of the  

State Act.  According to that Section, possession of the land can be  

taken in advance of town planning scheme with reference to the draft  

scheme.  The Planning Authority is entitled to make an application,  

through the Arbitrator, to the State Government to vest in it the land,  

without building, shown in the draft  scheme.  If  the Government is  

129

satisfied that such land is urgently necessary in the public interest, it  

could empower the Planning Authority  to enter  upon the land and  

may direct the Arbitrator to take possession of the land by notification  

in the Official Gazette.  The Arbitrator under Section 83(2) and 83(3)  

of the State Act is required to serve a notice to the person interested  

in the land to give possession of  the land to the Arbitrator  or  any  

person  authorized  by  him  within  the  specified  period.   If  there  is  

default of compliance to his directions issued under Section 83(3), the  

Arbitrator  can  request  the  Commissioner  of  Police  or  District  

Magistrate to enforce delivery of possession of land under Section 84  

of the MRTP Act.  Section 85 of the State Act directs that the person  

interested in such land shall be entitled to interest at the rate of 4 per  

cent per annum on amount of compensation payable to him under the  

final  scheme  in  respect  of  the  said  land  from the  date  on  which  

possession  is  taken  till  the  date  on  which  the  amount  of  

compensation  is  paid  to  him  by  the  Planning  Authority.   These  

provisions (Sections 83 to 85 of the MRTP Act) do not empower the  

Arbitrator  to  determine  the  compensation  and  no  such  power  is  

vested in the Arbitrator under Section 72 of the State Act too. The  

right of the person interested in the plot to receive compensation and  

130

interest as contemplated under Section 85 of the MRTP Act arises  

only when it is part of the land possession of which is taken as part of  

the  final  scheme.   The  final  scheme  is  to  be  sanctioned  by  the  

Government as per the provisions of Section 86 of the MRTP Act.     

Section 102, which falls in Chapter V(h) of the State Act, relates  

to payment of compensation in respect of property or right injuriously  

affected by the making of town planning scheme.  Even this Chapter  

does not talk of compensation payable for acquisition of land which is  

governed by Chapter VII and the relevant provisions of the Central  

Act.  The provisions of the Central Act, which are read into the State  

Act  by specific  reference,  do not  cause any impediment  in proper  

execution and attainment of the object of  planned development,  in  

fact, it is a pragmatic view which would further the cause of the State  

Act.  The provisions which provide for a time frame, consequences of  

default and lapsing of the proceedings under the amended Central  

Act cannot be deemed to be incorporated into the State Act by fiction  

of law.  We have already dealt with this aspect in some detail.  Suffice  

it  to  note  that  their  deemed  incorporation  will  disturb  the  working  

under the State Act and, simultaneously, defeat its purpose.  Different  

131

Benches of this Court, and for valid reasons, have taken the view that  

provisions of Section 6 as well as Section 11A of the Central Act are  

not  applicable  and  cannot  be  read  into  the  State  Act.   The  law  

enunciated in the case of Gauri Shankar Gaur (supra) in so far as it is  

in  line  with  the  principles  stated  in  this  judgment  is  the  correct  

enunciation  of  law.   The  view  of  this  Court  in  the  case  of  Sant  

Joginder Singh (supra) is again the correct statement of law but for  

reasons  stated  in  this  judgment  and  reasons  recorded  in  that  

judgment other than the distinction carved out between procedural  

and substantive provisions of a statute.  We may notice that  Gauri   

Shankar Gaur (supra)  was  followed in  Satya Pal  v.  State  of  U.P.  

[(1997) 9 SCC 117], wherein the Court took the view that Section 11A  

of the Land Acquisition Act would not be applicable to the U.P. Avas  

Evam Vikas Parishad Adhiniyam, 1965.

We  have  already  noticed  that  reservation,  designation  and  

acquisition are different concepts of distinct scope, application and  

consequences.  The acquisition of land, under the provisions of the  

Central Act, has to be for the purpose of the State Act.  There is a  

complete and comprehensive scheme on harmonious application of  

132

both  the  Acts  when  specific  provisions  of  the  Central  Act,  as  

contemplated under the State Act, alone are read into the State Act.  

The Planning  Authority  is  expected  to  prepare  the  plan  indicating  

what land it needs to acquire for implementation of the development  

plan. Like town planning scheme, once it is finalized, all concerned  

must  adhere  thereto  as  it  is  a  part  of  enforceable  law  and  

consequences  of  default  would  accordingly  flow.   No  person  can  

develop any property contrary to Development/Regional Plan or town  

planning scheme and permissions are required to be obtained under  

various provisions of the State Act.  Acquisition of land may become  

necessary  for  completing  the  planned  development.   Thus,  the  

acquisition will  only be for planned development as required under  

Section 126 of the State Act.  Of course, the State Government has  

been vested with the power to acquire land for a purpose other than  

the one for which it is designated in any plan or scheme, in terms of  

Section 128 of the State Act.  Still, the acquisition by the State under  

those  provisions  has  to  be  for  the  authorities  specified  under  the  

MRTP Act  or  for  Maharashtra  Industrial  Development  Corporation  

under the provisions of the Maharashtra Industrial Development Act,  

1961.    

133

The  vesting  of  land,  again,  has  different  connotations  when  

examined in light  of  different  provisions of  the State Act.   Section  

83(3) of the MRTP Act provides for vesting of land in the Planning  

Authority,  free  from  encumbrances,  in  advance  of  town  planning  

scheme.   Section  88  of  the  MRTP  Act  mentions  vesting  in  the  

Planning Authority, free from encumbrances, as one of the effects of  

final scheme, for the purpose of handing  over possession of the final  

plots to the owners to whom they are allotted in that scheme.  Section  

128(3)  of  the  MRTP Act  provides for  vesting  of  land in  the  State  

Government under Section 16 or 17 of the Land Acquisition Act, as  

the case may be, when the land is acquired for the purpose other  

than the one for which it is designated and the plan or the scheme  

shall be deemed to be suitably varied by reason of acquisition of the  

said  land.   Section  129(1)  of  the MRTP Act  relates  to  a situation  

where  urgency  provisions  are  invoked  by  the  State  upon  an  

application made by the Planning Authority and possession of land is  

taken thereof,  then it  shall  vest without any further assurance and  

free  from  encumbrances  in  the  State  Government.   There  are  

different kinds of vesting of lands as mentioned in the two Acts.  The  

State Act has multi-dimensional purposes leading to primary object of  

134

planned development, while the Central Act has only one dimension,  

i.e. acquisition of land for a specified public purpose.  The land, in  

terms of Section 16 of the Central Act shall vest in the State free of  

encumbrances only when the compensation is paid and possession  

of the land is taken under that Act.  Section 48  of the Central Act  

empowers the State to withdraw from acquisition of any land of which  

possession has not been taken, despite the fact that award may have  

been pronounced in terms of Section 11 of the Central Act.  But once  

there is complete vesting of land in the State it amounts to transfer of  

title from owner to the State by fiction of law.  Neither the Central Act  

has any provision to deal with re-vesting of the land in the owner, nor  

does it appear to be permissible within the scheme of both the Acts.  

Corollary to this would be that even where the reservation lapses as a  

result of default specified in the provisions of Sections 49, 126 and  

127 of the State Act the acquisition of the vested land would not, per  

se,  lapse.  The provisions of Section 11A of the Land Acquisition Act  

do not have any application to such cases under the provisions of  

MRTP  Act.   Furthermore,  the  provisions  of  Sections  126(2)  and  

127(1) of the State Act proceed on the basis that there has been no  

acquisition of land or there is a default  in acquiring the land.  The  

135

bare reading of these provisions puts the matter beyond ambiguity  

that where the land has been acquired these provisions would not  

apply. This is so because if the land stands acquired and owner is  

divested of its title he is left with no interest in the acquired land or  

even against the reservation of such land.  Where lands have not  

been acquired and the default persists for periods specified under the  

relevant  provisions,  that  land  would  become  available,  free  of  

reservation  or  designation,  to  the  owner  for  developing  it  in  

accordance with law.  The legislature in its wisdom, and appears to  

us  rightly  so,  has  not  referred  to  lapsing  of  acquisition  as  a  

consequence of the default contained in Section 127 of the State Act.  

Section 127 opens with the  words “If any land reserved, allotted or  

designated for any purpose specified in any plan  under this Act is not  

acquired  by agreement within ten years ……………………” or if  a  

declaration under sub-section (2) or sub-section (4) of Section 126  of  

the MRTP Act is not published in the Official Gazette  within such  

period then the interested person is entitled to invoke the provisions  

of Section 127 of the MRTP Act by serving a notice and still if steps  

for acquisition are not taken within twelve months of the date of such  

notice for  acquiring the land or  the land is not  acquired  then the  

136

consequences of lapsing of reservation, allotment or designation shall  

follow.  This also demonstrates the intention of the legislature, not to  

apply mandate of Section 11A of the Central Act to the State Act.  

Lapsing of acquisition is not contemplated under the scheme of either  

of  the two Acts  in  question,  once the land is  vested in  the State.  

Such a view will find support from the fact that under the provisions of  

the State Act the Government has been given power to acquire land  

for the purpose other than the one for which it was specified in the  

plan, i.e. the purpose of acquisition can be changed.  Whenever such  

a situation arises, in that event, the relevant plan or scheme shall also  

be deemed to be suitably varied by such acquisition in terms of Sub-

sections (1), (1A) and (2) of Section 128 of the State Act.  

Application  of  doctrine  of  pith  and  substance  and  incidental  encroachment to the issue raised in the present case

The doctrine of pith and substance can be applied to examine  

the  validity  or  otherwise  of  a  legislation  for  want  of  legislative  

competence as well as where two legislations are embodied together  

for achieving the purpose of the principal Act.  Keeping in view that  

we  are  construing  a  federal  Constitution,  distribution  of  legislative  

powers between the Centre and the State is of  great  significance.  

137

Serious attempt was made to convince the Court that the doctrine of  

pith and substance has a very restricted application and it  applies  

only  to  the  cases where the Court  is  called  upon to  examine the  

enactment to be  ultra vires on account of legislative incompetence.  

We are unable to persuade ourselves to accept this proposition.  The  

doctrine of pith and substance find its origin from the principle that it  

is  necessary  to  examine  the  true  nature  and  character  of  the  

legislation  to  know  whether  it  falls  in  a  forbidden  sphere.   This  

doctrine  was  first  applied  in  India  in  the  case  of  Prafulla  Kumar  

Mukherjea  v.  Bank  of  Commerce Ltd.,  Khulna [AIR 1947 PC 60].  

The principle has been applied to the cases of alleged repugnancy  

and we see no reason why its application cannot be extended even to  

the  cases  of  present  kind  which  ultimately  relates  to  statutory  

interpretation founded on source of legislation.  In the case of Union  

of  India v.  Shah Gobardhan L.  Kabra Teachers’ College  [(2002) 8  

SCC 228], this Court held that in order to examine the true character  

of the enactment, the entire Act, its object and scope is required to be  

gone  into.   The  question  of  invasion  into  the  territory  of  another  

legislation is to be determined not by degree but by substance.  The  

doctrine of pith and substance has to be applied not only in cases of  

138

conflict between the powers of two legislatures but also in any case  

where  the  question  arises  whether  a  legislation  is  covered  by  a  

particular  legislative  field  over  which the power is  purported to  be  

exercised.  In other words, what is of paramount consideration is that  

the substance of the legislation should be examined to arrive at a  

correct  analysis  or  in  examining  the  validity  of  law,  where  two  

legislations are in conflict or alleged to be repugnant.  An apparent  

repugnancy upon proper examination of substance of the Act may not  

amount to a repugnancy in law.  Determination of true nature and  

substance of the laws in question and even taking into consideration  

the extent to which such provisions can be harmonized, could resolve  

such a controversy and permit the laws to operate in their respective  

fields.   The  question  of  repugnancy  arises  only  when  both  the  

legislatures are competent to legislate in the same field,  i.e.  when  

both,  the  Union and the  State  laws,  relate  to  a  subject  in  List  III  

[(Hoechst Pharamaceuticals Ltd. v. State of Bihar [(1983) 4 SCC 45)].  

We have already noticed that according to the appellant, the source  

of  legislation  being  Article  246  read  with  Entry  No.  42  of  the  

Concurrent List the provisions of the State Act in so far as they are in  

conflict with the Central Act, will be still born and ineffective.  Thus,  

139

provisions  of  Section  11A of  the  Land  Acquisition  Act  would  take  

precedence.  On  the  contrary,  it  is  contended  on  behalf  of  the  

respondent  that  the  planned  development  and  matters  relating  to  

management  of  land are relatable  to  Entry  5/18 of  State  List  and  

acquisition being an incidental act, the question of conflict does not  

arise and the provisions of the State Act can be enforced without any  

impediment.   This  controversy  need  not  detain  us  any  further  

because the contention is squarely answered by the Bench of this  

Court in Bondu Ramaswami’s case (supra) where the Court not only  

considered the applicability of the provisions of the Land Acquisition  

Act  vis-à-vis  the  Bangalore  Act  but  even  traced  the  source  of  

legislative  competence  for  the  State  law  to  Entry  5  of  List  II  of  

Schedule VII and held as under:

“92. Where the law covered by an entry in the  State  List  made  by  the  State  Legislature  contains  a  provision  which  directly  and  substantially relates to a matter enumerated in  the  Concurrent  List  and is  repugnant  to  the  provisions of any existing law with respect to  that  matter  in  the  Concurrent  List,  then  the  repugnant provision in the State List may be  void unless it can coexist and operate without  repugnancy to  the provisions of  the  existing  law. This Court in  Munithimmaiah v. State of   Karnataka [(2002) 4 SCC 326] has held that  

140

the  BDA  Act  is  an  Act  to  provide  for  the  establishment of a Development Authority to  facilitate  and  ensure  planned  growth  and  development  of  the  city  of  Bangalore  and  areas adjacent thereto, and that acquisition of  any  lands,  for  such  development,  is  merely  incidental to the main object of the Act, that is,  development of Bangalore Metropolitan Area.  This Court held that in pith and substance, the  BDA  Act  is  one  which  squarely  falls  under  Entry 5 of List II of the Seventh Schedule and  is not a law for acquisition of land like the LA  Act,  traceable  to  Entry  42  of  List  III  of  the  Seventh  Schedule,  the  field  in  respect  of  which is already occupied by the Central Act,  as amended from time to time. This Court held  that if at all, the BDA Act, so far as acquisition  of  land  for  its  developmental  activities  is  concerned,  in  substance  and  effect  will  constitute  a  special  law  providing  for  acquisition  for  the  special  purposes  of  BDA  and the same will  not be considered to be a  part  of  the  LA  Act.  The  fallacy  in  the  contention of the appellants is that it assumes,  erroneously,  that  the  BDA  Act  is  a  law  referable to Entry 42 of List III, while it is a  law referable to Entry 5 of List II.  Hence the  question of repugnancy and Section 6 of the  LA Act prevailing over Section 19 of the BDA  Act would not at all arise.”

While holding as above, the Bench found that the question of  

repugnancy  did  not  arise.   The  Court  has  to  keep  in  mind  that  

function  of  these constitutional  lists  is  not  to  confer  power,  but  to  

merely demarcate the legislative heads or fields of legislation and the  

141

area  over  which  the  appropriate  legislatures  can  operate.   These  

Entries have always been construed liberally as they define fields of  

power  which  spring  from  the  constitutional  mandate  contained  in  

various clauses of Article 246.  The possibility of overlapping cannot  

be  ruled  out  and  by  advancement  of  law  this  has  resulted  in  

formulation of, amongst others, two principal doctrines, i.e. doctrine of  

pith and substance and doctrine of  incidental  encroachment.   The  

implication of these doctrines is, primarily, to protect the legislation  

and to construe both the laws harmoniously and to achieve the object  

or  the  legislative  intent  of  each  Act.   In  the  ancient  case  of  

Muthuswami Goundan v. Subramanyam Chettiar [1940 FCR 188], Sir  

Maurice Gwyer, CJ supported the principle laid down by the Judicial  

Committee  as  a  guideline,  i.e.  pith  and  substance  to  be  the  true  

nature and character of the legislation, for the purpose of determining  

as to which list the legislation belongs to.  This Court in the case of  

Jijubhai  Nanbhai  Kachar v.  State  of  Gujarat [1995  Supp.(1)  SCC  

596],  referring  to  the  principle  of  interpretation  of  Entries   in  the  

legislative lists, held as under:

“7. It  is  settled  law  of  interpretation  that  entries  in  the  Seventh  Schedule  are  not  

142

powers but fields of legislation. The legislature  derives its power from Article 246 and other  related articles of the Constitution. Therefore,  the  power  to  make  the  Amendment  Act  is  derived  not  from  the  respective  entries  but  under  Article  246  of  the  Constitution.  The  language of the respective entries should be  given the widest scope of their meaning, fairly  capable  to  meet  the  machinery  of  the  Government settled by the Constitution. Each  general word should extend to all ancillary or  subsidiary  matters  which  can  fairly  and  reasonably be comprehended in it. When the  vires of an enactment is impugned, there is an  initial presumption of its constitutionality and if  there is any difficulty in ascertaining the limits  of the legislative power, the difficulty must be  resolved,  as far  as possible in favour of the  legislature putting the most liberal construction  upon the legislative entry so that it may have  the widest amplitude….”

The primary object of applying these principles is not limited to  

determining the reference of legislation to an Entry in either of the  

lists, but there is a greater legal requirement to be satisfied in this  

interpretative process.  A statute should be construed so as to make  

it effective and operative on the principle expressed in the maxim ut  

res  magis  valeat  quam pereat.   Once it  is  found that  in  pith  and  

substance, an Act is a law on a permitted field then any incidental  

encroachment,  even  on  a  forbidden  field,  does  not  affect  the  

143

competence of the legislature to enact that law [State of Bombay v.  

Narottamdas  Jethabhai [1951  SCR  51].   To  examine  the  true  

application of these principles, the scheme of the Act, its object and  

purpose, the pith and substance of the legislation are required to be  

focused at, to determine its true nature and character.  The State Act  

is  intended  only  to  ensure  planned  development  as  a  statutory  

function of the various authorities constituted under the Act and within  

a  very  limited  compass.   An incidental  cause cannot  override  the  

primary  cause.   When both  the Acts  can be implemented without  

conflict,  then  need  for  construing  them harmoniously  arises.   We  

have already discussed in great detail that the State Act being a code  

in itself can take within its ambit provisions of the Central Act related  

to  acquisition,  while  excluding  the  provisions  which  offend  and  

frustrate the object of the State Act.  It will not be necessary to create,  

or  read  into  the  legislations,  an  imaginary  conflict  or  repugnancy  

between the two legislations, particularly, when they can be enforced  

in their respective fields without conflict.  Even if they are examined  

from the point of view that repugnancy is implied between Section  

11A of the Land Acquisition Act and Sections 126 and 127 of the  

MRTP Act,  then in our considered view, they would fall  within the  

144

permissible  limits  of  doctrine  of  “incidental  encroachment”  without  

rendering any part of the State law invalid.   Once the doctrine of pith  

and substance is applied to the facts of the present case, it is more  

than  clear  that  in  substance  the  State  Act  is  aimed  at  planned  

development  unlike the Central  Act  where the object  is  to acquire  

land and disburse compensation in accordance with law. Paramount  

purpose and object of the State Act being planned development and  

acquisition being incidental thereto, the question of repugnancy does  

not arise.  The State, in terms of Entry 5 of List II of Schedule VII, is  

competent to enact such a law. It is a settled canon of law that Courts  

normally would make every effort to save the legislation and resolve  

the conflict/repugnancy,  if  any,  rather  than invalidating the statute.  

Therefore,  it  will  be  the  purposive  approach  to  permit  both  the  

enactments  to  operate  in  their  own  fields  by  applying  them  

harmoniously.  Thus, in our view, the ground of repugnancy raised by  

the appellants, in the present appeals, merits rejection.

        A self-contained code is an exception to the rule of referential  

legislation.  The various legal concepts covering the relevant issues  

have been discussed by us in detail  above.   The schemes of  the  

145

MRTP Act and the Land Acquisition Act do not admit any conflict or  

repugnancy in their implementation.  The slight overlapping would not  

take the colour of repugnancy.  In such cases, the doctrine of pith and  

substance would squarely be applicable and rigours of Article 254(1)  

would  not  be  attracted.   Besides  that,  the  reference  is  limited  to  

specific  provisions  of  the  Land  Acquisition  Act,  in  the  State  Act.  

Unambiguous language of the provisions of the MRTP Act and the  

legislative intent clearly mandates that it is a case of legislation by  

incorporation  in  contradistinction  to  legislation  by  reference.   Only  

those  provisions  of  the  Central  Act  which  precisely  apply  to  

acquisition of land, determination and disbursement of compensation  

in accordance with law, can be read into the State Act.  But with the  

specific exceptions that the provisions of the Central Act relating to  

default  and  consequences  thereof,  including  lapsing  of  acquisition  

proceedings, cannot be read into the State Act.  It is for the reason  

that neither they have been specifically incorporated into the State  

law nor they can be absorbed objectively into that statute.  If such  

provisions (Section 11A being one of such sections) are read as part  

of  the  State  enactment,  they  are  bound  to  produce  undesirable  

results as they would destroy the very essence, object and purpose  

146

of the MRTP Act.  Even if fractional overlapping is accepted between  

the two statutes, then it  will  be saved by the doctrine of incidental  

encroachment,  and  it  shall  also  be  inconsequential  as  both  the  

constituents have enacted the respective laws within their legislative  

competence and, moreover, both the statutes can eloquently co-exist  

and  operate  with  compatibility.  It  will  be  in  consonance  with  the  

established  canons  of  law  to  tilt  the  balance  in  favour  of  the  

legislation rather  than invalidating the same, particularly,  when the  

Central and State Law can be enforced symbiotically to achieve the  

ultimate goal of planned development. Thus, the contentions raised  

by the appellants are unsustainable in law as considered by us under  

different heads and are liable to be rejected.

Before  we  conclude,  we  must  notice  that  learned  counsel  

appearing for respective parties had raised certain other contentions  

during the course of  arguments,  which have not  been,  specifically  

and intentionally, dealt with by us in the judgment.  Firstly, in the facts  

and circumstances of the case, it  is not  necessary for  us to dwell  

upon those contentions in any detail as we are of the considered view  

that the question referred could be answered by the Court  without  

147

going  into  the  merit  or  otherwise  of  these  arguments.   Secondly,  

because on application of different doctrines and principles,  de hors  

the  contentions  raised  and  judgments  relied  upon  in  that  regard  

including  the  plea  of  legislative  abdication,  we  have  precisely  

answered the question referred to the larger bench.    Thus, we leave  

these questions open to be dealt with in an appropriate case.  These  

contentions are:  

1. The Constitution Bench in  B. Shama Rao’s case (supra) has  

clearly stated the principle that even in the case of legislation by  

reference, if subsequent amendments are deemed to be part of  

the later  law adopting the earlier  law, in  that  event,  it  would  

amount to abdication of legislative functions by the concerned  

constituent.  It was also contended that  B. Shama Rao’s case  

(supra) has not been noticed by subsequent Benches including  

the Constitution Bench of this Court and, thus, the law in the  

later judgments cannot be said to be correct exposition of law.  

On the contrary, reference was made to the Constitution Bench  

judgment of this Court in  Gwalior Rayon Silk Mfg. (Wvg.) Co.  

Ltd. v. The Asstt. Commissioner of Sales Tax  [(1974) 4 SCC  

98] to contend that the ruling in  B. Shama Rao’s case (supra)  

148

must  be  confined  to  the  facts  of  that  case.   It  is  doubtful  

whether  there  is  any  general  principle  which  precludes  the  

Parliament  or  a  State  Legislature  from  adopting  a  law  and  

future amendments to the law passed respectively by a State  

Legislature  or  the  Parliament  and  incorporating  them  in  its  

legislation.  Further, it was contended that the law in B. Shama  

Rao (supra) was contrary to the ratio of the judgment of this  

Court  in  Rajnarain  Singh v.  Chairman,  Patna  Administration  

Committee  [(1955  (1)  SCR  290]  and  the  still-born  theory  

expanded in  B. Shama Rao’s case (supra) was even contrary  

to Devi Das v. State of Punjab [AIR 1967 SC 1896].  

2. The other challenge was on the ground that if the provisions of  

Section 11A of the Land Acquisition Act are not read into the  

provisions of the MRTP Act, it will result in patent discrimination  

in  regard  to  determination  of  compensation  and,  thus,  is  

violative of Article 14 of the Constitution of India.  Per Contra, it  

was argued that such contention, in somewhat similar cases,  

has already been rejected by different Benches of this Court  

and has no merit.  Reliance in this regard was placed upon the  

judgments of this Court in the case of  U.P. Avas Evam Vikas  

149

Parishad (supra)  and  a  Constitution  Bench  judgment  in  the  

case of Nagpur Improvement Trust-II (2002) (supra).

3. The various judgments  of  this  Court  have not  examined the  

effect of federal structure of the Constitution while applying the  

principle  enunciated  by  the  Privy  Council  in  the  case  of  

Hindusthan Co-operative Insurance Society Ltd. (supra).

Having said so, now we proceed to record our answer to the  

proposition referred to the larger Bench as follows :

“For  the  reasons  stated  in  this  judgment,  we  hold  that  the  

MRTP Act is a self-contained code.  Further, we hold that provisions  

introduced in the Land Acquisition Act,  1894 by Central  Act  68 of  

1984,  limited  to  the  extent  of  acquisition  of  land,  payment  of  

compensation  and  recourse  to  legal  remedies  provided  under  the  

said Act, can be read into an acquisition controlled by the provisions  

of Chapter VII of the MRTP Act but with a specific exception that the  

provisions  of  the  Land  Acquisition  Act  in  so  far  as  they  provide  

different time frames and consequences of default thereof including  

lapsing of acquisition proceedings cannot be read into the MRTP Act.  

Section 11A of the Land Acquisition Act being one of such provisions  

150

cannot be applied to the acquisitions under Chapter VII of the MRTP  

Act.”

The  Reference  is  answered  accordingly.   Matters  now  be  

placed before the appropriate Bench for disposal in accordance with  

law.

….………….............................CJI.                 (S.H. Kapadia)

…….………….............................J.         (Dr. Mukundakam Sharma)

…….………….............................J. (K.S. Panicker Radhakrishnan)

...….………….............................J.  (Swatanter Kumar)

…….………….............................J.  (Anil R. Dave)

New Delhi

January 11, 2011

151