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NON-REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.2906  OF 2013 (Arising out of SLP(C) No. 19003 of 2009)

State of Maharashtra          …Appellant

versus

Bhakti Vedanta Book Trust and others …Respondents

J U D G M E N T

G. S. Singhvi, J.

1. Leave granted.

2. Respondent No.1 is the owner of the land measuring 5300 sq. mtrs.  

comprised in Survey No.72,  Penkarpada,  Mira Road, within the municipal  

limits of Mira Bhayandar Municipal Corporation (hereinafter referred to as,  

‘the Corporation’). In the Development plan prepared under the Maharashtra  

Regional and Town Planning Act, 1966 (for short, ‘the 1966 Act’), which  

was sanctioned on 14.5.1997 and was enforced on 15.7.1997, a portion of the  

land belonging to respondent No.1 (2500 sq. mtrs.) was shown as reserved  

for extension of Royal College of Arts, Science and Commerce run by the  

Royal Society of Bombay (for short, ‘the Society’).  

3. In December, 2005 the Corporation made an application to the District  

Collector for initiation of the acquisition proceedings. The latter asked the  

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Corporation  to  submit  detailed  proposal  for  facilitating  the  acquisition.  

Thereupon, the Competent Authority prepared a  detailed plan,  which was  

submitted to the Collector on 26.7.2006.

4. In the meanwhile, the Society filed Writ Petition No.4341/2005 for  

issue of a direction to the State Government and the Corporation to expedite  

the acquisition proceedings. The Division Bench of the High Court disposed  

of the writ petition vide order dated 16.2.2006, the relevant portion of which  

is extracted below:

“From  the  affidavit  filed  by  Sanjay  Adhav,  Special  Land  Acquisition  Officer,  the  Learned  G.P.  points  out  that  the  Municipal  Corporation  has  already  forwarded  the  necessary  documents to the Collector in the prescribed form. Considering  that,  the  Special  Land Acquisition Officer  to  pass  an  award  within six months. It is further made clear that on the Special  Land Acquisition Officer calling on the petitioners to deposit the  compensation as computed by him, the same would be deposited  by the petitioners within four weeks of such demand. It is only  thereupon that the Special Land Acquisition Officer to proceed  to  pass  an award  and,  thereafter,  to  take  steps  to  hand over  possession within one month after  the award is passed.  Rule  made absolute accordingly.”

5. Since  the  Special  Land  Acquisition  Officer  did  not  take  steps  in  

furtherance  of  the  directions  contained in the  aforesaid  order,  respondent  

No.1 issued purchase notice dated 25.7.2007 under Section 127 of the 1966  

Act,  which  was  duly  served  upon  the  Corporation.   After  one  year,  

respondent No.1 submitted plan dated 28.7.2008 for construction of a library  

building on the land owned by it.  The same was rejected by the Competent  

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Authority  vide  order  dated  29.9.2008  on  the  ground  that  the  land  was  

reserved for the college and the acquisition proceedings had already been  

initiated.

6. Respondent No.1 challenged the rejection of its plan in Writ Petition  

No.36/2009.  The pleaded case of respondent No.1 was that reservation of  

the land had lapsed and the reason assigned by the Competent Authority for  

rejecting the building plan was legally untenable. In paragraphs 11 to 16 and  

21 to 26 of the writ petition, respondent No.1 made the following averments:

“11. By their letter dated 28th April, 2006,  the petitioners for- warded a copy of the aforesaid order of this Hon'ble Court dated  16th  February,  2006  to  the  respondent  No.1  and  inter  alia,  re- quested it to demarcate the land area admeasuring 0.25 hectors to  enable the petitioners to comply with the aforesaid order of this  Hon'ble Court. Hereto annexed and marked Exhibit C is a copy of  the said letter dated 26th April, 2006.

12. The petitioners by their further letter dated 6th May, 2006 inter  alia, requested the respondent No.1 to expedite the process of de- marcation and intimate in writing to enable the petitioners to com- ply with the aforesaid orders of this Hon'ble Court within the stipu- lated time. Hereto annexed and marked as Exhibit D is the copy of  the said letter dated 6th May, 2006.

13. By the letter dated May 31, 2006, the Advocates for the peti- tioners, after setting out the relevant fact inter alia requested the re- spondent No.2, to intimate the petitioners at the earliest the land de- marcated  and/or  reserved for  extension of Royal College failing  which the petitioners will not be in a position to comply with the  aforesaid order of this Hon'ble Court. Hereto annexed and marked  as Exhibit E is a copy of the said letter dated May 31, 2006.

14. The Advocates for the said Royal Society of Bombay, by their  letter dated 27th Jun3, 2006, inter alia called upon the petitioners to  remove the illegal structures purported to be standing on the said  

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land. Hereto annexed and marked as Exhibit F is a copy of the said  letter dated 27th June, 2006.

15. The advocates for the petitioners by their letter dated June 29,  2006 replied to the aforesaid letter dated 27th June, 2006 of the Ad- vocates for the said Royal Society. By the said letter, the advocates  for the petitioners, after setting out the relevant fact, inter alia in- formed the Advocates for the said Royal Society, that in the ab- sence of demarcation of land to be allotted to the said Royal Soci- ety by the respondent No.1, the petitioners are not in a position to  comply with the aforesaid order of this Hon'ble Court. Hereto an- nexed and marked as Exhibit G is the copy of the said letter dated  June 29, 2006.

16. By a letter dated 26th June, 2006 the respondent No.1 after set- ting out some of the facts,  inter alia,  requested the Collector  of  Thane, Thane to transfer the said property inferred to therein to the  municipal Corporation as  early as  possible.  Hereto annexed and  marked Exhibit H is a copy of the said letter dated 28th June, 2008  in English translation along with its original Marathi copy.

21. It can be seen from the facts of the case that the Special Land  Acquisition Officer did not comply with the order of this Hon'ble  Court of making the award within six months.

22. In the circumstances aforesaid, the petitioners aforesaid a pur- chase notice dated 25th July, 2007 under Section 127 of the Maha- rashtra Regional and Town Planning Act to the respondent No.1 re- quiring the respondent No.1 to take steps for acquisition within six  months from the receipt of the said purchase notice, in accordance  with the Act failing which allow the petitioners to develop the said  land for the permissible user.  This said purchase notice was re- ceived by the respondent No.1 on the same day. Hereto annexed  and marked as Exhibit J is a copy of the said purchase notice dated  25th July, 2007.

23. By a letter dated 18tn August, 2007, the respondent No.1 in- formed the petitioners that on 26th July, 2006, the respondent No.1  has submitted a proposal for land acquisition in respect of the peti- tioners land and hence rejected the petitioners said purchase notice.  Hereto annexed and marked as Exhibit K is a copy of the said letter  dated 18th August, 2007 in English translation along with its origi- nal Marathi copy together with said copy of the said letter dated  26th July, 2006 in English translation and original Marathi copy.  

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No steps are taken to purchase the said portion of land within 6  months in terms of the notice dated 25th July, 2007.

24. The petitioners by their Architects letter dated 28tn July, 2006,  submitted to the respondent No.2 on 2nd August, 2008 inter alia  submitted four sets of proposed plan of the property bearing Survey  NO.237 p. of village Penkarpada, District Thane along with neces- sary documents for the proposed Library Building and requested the  respondent No.2 to approve the plan at the earliest. Hereto annexed  and marked as Exhibit L is a copy of the said letter dated 28th July,  2008.

25. On behalf of the respondent No.1, the respondent No.3 by the  communication dated 29th September, 2008 inter alia rejected the  application of the petitioners for development of the said plot of  land on the ground that part of the said plot of the land is for exten- sion of college and is reserved for Royal College and in the absence  of NOC from the said Royal College, it is bound by the said reser- vation of the said plot of land for extension of college and it is not  possible to permit the development. Hereto annexed and marked as  Exhibit M is a copy of the said communication dated 29th Septem- ber,  2008  in English translation  along with its  original  Marathi  copy.

26. It is submitted that the action of the respondents in not sanction- ing and granting the petitioners' proposal submitted to the respon- dent No.2 vide their Architects  letter dated 28th July, 2008,  for  construction  of  library  building on  the  property  bearing Survey  No.237  p.  of  village -  Pankarpada,  District  Thane,  Mira  Road,  Thane and the communication dated 29th September, 2008 (here- inafter referred to as “the impugned communication”) issued by re- spondent No.3 rejecting the petitioners proposal is illegal and other- wise untenable and unsustainable in law on the following amongst  other grounds, which are taken without prejudice to one another.”

7. In the counter affidavits filed by respondent Nos. 6, 8-10, 12, 13, 15  

and 16, it was pleaded that reservation of the land belonging to respondent  

No.1 cannot be treated to have lapsed because the acquisition proceedings  

had already commenced and in terms of the direction given by the High Court  

in Writ  Petition No.4341/2005,  the Special Land Acquisition Officer was  

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required to pass an award within the stipulated period.  However, they did not  

dispute the averments contained in various paragraphs of the writ petition,  

which have been extracted hereinabove.

8. The Division Bench of the High Court relied upon the judgments of this  

Court  in Girnar Traders  v.  State  of  Maharashtra  (2007)  7  SCC 555  and  

Prakash R.Gupta v. Lonavala Municipal Council and others (2009) 1 SCC  

514 and ruled that reservation of the land belonging to respondent No.1 will  

be deemed to have lapsed because the same was neither acquired nor steps  

were taken for that  purpose within six months of the receipt  of purchase  

notice.

9. We have heard learned counsel for the parties and perused the record.  

Section 126  of  the  1966  Act,  which provides  for  the acquisition of  land  

required or reserved for any of the public purposes specified in any plan or  

scheme prepared under the Act and Section 127 of the  1966 Act, which  

envisages lapsing of reservation in certain contingencies read as under:

“Section 126. Acquisition of land required for public purposes  specified in plans. - (1) When after the publication of a draft Re- gional Plan,  a  Development or  any other plan or  town planning  scheme, any land is required or reserved for any of the public pur- poses 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 acquire the land,-

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

(b) in lieu of any such amount, by granting the land-owner or the  

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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 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 section or under the Land Acquisition Act, 1894,  as  the  case  may  be,  shall  vest  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 land 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 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 (1 of 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, 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  

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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 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 purposes of determining the market value of land in respect of  which  proceedings  for   acquisition  commenced  before  the  commencement of the Maharashtra Regional and Town Planning  (Second Amendment) Act, 1972 (Mah. XI of 1973):

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 subsection (1) of section 40 prior  to  the  commencement  of  the  Maharashtra  Regional  and  Town  Planning (Second Amendment) Act, 1972 (Mah. XI of 1973), shall  be the market value prevailing on the date of such commencement.

(4)  Notwithstanding  anything  contained  in  the  proviso  to  sub- section (2) and in subsection (3), if a declaration is not made within  the period referred to in subsection (2) or having been made, the  aforesaid period expired at the commencement of the Maharashtra  Regional  Town  Planning  (Amendment)  Act,  1993,  the  State  Government may make a fresh declaration for acquiring the land  under the Land Acquisition Act, 1894 (I of 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. Lapsing of reservation –

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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 (1 of 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 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.”

10. The  above-reproduced  provisions  were  considered  by  this  Court  in  

Municipal  Corporation  of  Greater  Bombay  v.  Dr.  Hakimwadi  Tenants’  

Association 1988 (Supp.) SCC 55. The facts of that case were that the Planning  

Authority  had  published  a  draft  Development  plan  in  respect  of  ‘D’  ward  

showing the  property belonging to  late  Dr.  Eruchshaw Jamshedji  Hakim as  

reserved for recreation ground. The final Development plan was made effective  

from 7.2.1967. However, no action was taken for the acquisition of land. The  

owner  served  purchase  notice  dated  1.7.1977  on  the  Commissioner  of  the  

Corporation.  After  about  6  months,  the  Corporation passed  resolution dated  

10.1.1978  for  the  acquisition  of  land  and  sent  an  application  to  the  State  

Government for taking necessary steps. Thereupon, the State Government issued  

Notification dated 7.4.1978 under Section 6 of the Land Acquisition Act, 1894  

(for short, ‘the 1894 Act’). The writ petition filed by Dr. Hakimwadi Tenants’  

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Association questioning the notification was allowed by the learned Single Judge  

of  the  Bombay  High  Court,  who  held  that  the  acquisition  proceedings  

commenced by the State Government under Section 126(2) of the 1966 Act at  

the instance of the Planning Authority were not valid because steps were not  

taken for the acquisition of land under Section 126(1) of the 1966 Act read with  

Section 6 of the 1894 Act within the prescribed time. The learned Single Judge  

observed that the period of six months prescribed under Section 127 of the 1966  

Act began to run from the date of service of purchase notice and the Corporation  

had to take steps to acquire the property before 4.1.1978, which was not done.  

The Division Bench of the High Court approved the view taken by the learned  

Single Judge and held that the most crucial step was the application to be made  

by the Corporation to the State Government under Section 126(1) of the 1966  

Act for the acquisition of the land and such step ought to have been taken within  

the period of six months commencing from 4.7.1977. This Court agreed with the  

counsel for the Corporation that the words ‘six months from the date of service  

of such notice’ used in Section 127 of the 1966 Act were not susceptible to a  

literal construction, but observed:  

“8. ……………………….it  must  be  borne  in  mind  that  the  period of six months provided by Section 127 upon the expiry of  which the reservation of the land under a Development Plan lapses,  is a valuable safeguard to the citizen against arbitrary and irrational  executive action. Section 127 of the Act is a fetter upon the power  of  eminent domain. By enacting Section 127  the legislature has  struck a balance between the competing claims of the interests of  the general public as regards the rights of an individual.”

(emphasis supplied)

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The Court then made detailed analysis of Section 127 of the 1966 Act and  

held:  

“10. Another safeguard provided is the one under Section 127 of  the Act. It cannot be laid down as an abstract proposition that the  period of six months would always begin to run from the date of  service of notice. The Corporation is entitled to be satisfied that the  purchase notice under Section 127 of the Act has been served by  the owner or any person interested in the land. If there is no such  notice by the owner or any person, there is no question of the reser- vation, allotment or designation of the land under a development  plan of having lapsed. It a fortiori follows that in the absence of a  valid notice under Section 127, there is no question of the land be- coming available to the owner for the purpose of development or  otherwise.  In the present case,  these considerations do not arise.  We must hold in agreement with the High Court that the purchase  notice dated July 1, 1977 served by Respondents 4-7 was a valid  notice and therefore with the failure of the appellant to take any  steps for the acquisition of the land within the period of six months  therefrom, the reservation of the land in the Development Plan for a  recreation ground lapsed and consequently, the impugned notifica- tion dated April 7, 1978 under Section 6 of the Land Acquisition  Act issued by the State  Government must be  struck down as  a  nullity.

11. Section 127 of the Act is a part of the law for acquisition of  lands required for public purposes, namely, for implementation of  schemes of town planning. The statutory bar created by Section 127  providing that  reservation  of  land  under  a  development  scheme  shall lapse if no steps are taken for acquisition of land within a  period of six months from the date of service of the purchase no- tice, is an integral part of the machinery created by which acquisi- tion of land takes place. The word “aforesaid” in the collocation of  the words “no steps as aforesaid are commenced for its acquisition”  obviously refer to the steps contemplated by Section 126(1). The  effect of a declaration by the State Government under sub-section  (2) thereof, if it is satisfied that the land is required for the imple- mentation of a regional plan, development plan or any other town  planning scheme, followed by the requisite declaration to that effect  in the official Gazette, in the manner provided by Section 6 of the  Land Acquisition Act, is to freeze the prices of the lands affected.  The Act lays down the principles of fixation by providing firstly, by  the proviso to Section 126(2) that no such declaration under sub-

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section (2) shall be made after the expiry of three years from the  date of publication of the draft regional plan, development plan or  any other plan, secondly, by enacting sub-section (4) of Section 126  that if a declaration is not made within the period referred to in sub- section (2),  the State Government may make a  fresh declaration  but, in that event, the market value of the land shall be the market  value at the date of the declaration under Section 6 and not the mar- ket value at the date of the notification under Section 4, and thirdly,  by Section 127 that if any land reserved, allotted or designated for  any purpose in any development plan is not acquired by agreement  within 10 years from the date on which a final regional plan or de- velopment plan comes into force or if proceedings for the acquisi- tion of such land under the Land Acquisition Act are  not  com- menced within such period, such land shall be deemed to be re- leased from such reservation, allotment or designation and become  available to the owner for the purpose of development on the failure  of the Appropriate Authority to initiate any steps for its acquisition  within a period of six months from the date of service of a notice by  the owner or any person interested in the land. It cannot be doubted  that a period of 10 years is long enough. The Development or the  Planning Authority must  take  recourse  to  acquisition with some  amount of promptitude in order that the compensation paid to the  expropriated owner bears a just relation to the real value of the land  as otherwise, the compensation paid for the acquisition would be  wholly illusory. Such fetter on statutory powers is in the interest of  the general public and the conditions subject to which they can be  exercised must be strictly followed.”

(emphasis supplied)

11. The same issue was again considered in Girnar Traders (II). S.P. Building  

Corporation was  the owner of a  piece  of land bearing City Sy.  No.  18/738  

admeasuring about 5387.35 square yards situated at Carmichael Road, Malabar  

Hill Division, Mumbai. The Development plan prepared by Bomba Municipal  

Corporation was  sanctioned by the  State  Government on  6.1.1967  and  was  

enforced on 7.2.1967.  The land belonging to  S.P.  Building Corporation was  

notified as “open space and children’s park”.  After coming into force of the  

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1966 Act, the landowners served notice under Section 127 of that Act for de-

reservation of  the  land.   Two similar  notices  were  issued  by S.P.  Building  

Corporation on 18.10.2000 and 15.3.2002.  After about eight months, the State  

Government issued notification dated 20.11.2002 under Section 126(2) and (4)  

of the 1966 Act read with Section 6 of the 1894 Act.  Writ Petition No.353/2005  

filed by S.P.  Building Corporation questioning the notification issued by the  

State Government was dismissed by the Division Bench of the High Court by  

observing that Resolution dated 9.9.2002 passed by the Improvement Committee  

of the Municipal Corporation would constitute a step as contemplated by Section  

127 of the 1966 Act. The Division Bench further held that Section 11A of the  

1894 Act,  as  amended,  is not applicable to  the proceedings initiated for the  

acquisition of land under the 1966 Act.  Civil Appeal No.3922/2007 filed by  

S.P. Building Corporation was decided by the three Judge Bench along with  

Civil Appeal No.3703/2003 - Girnar Traders v. State of Maharashtra. Speaking  

for the majority, P.P. Naolekar, J., referred to the relevant provisions of the 1966  

Act including Sections 126 and 127, and observed:    

“31. Section 127 prescribes two time periods. First, a period of 10  years within which the acquisition of the land reserved, allotted or  designated has  to  be  completed  by agreement from the date  on  which a regional plan or development plan comes into force, or the  proceedings for acquisition of such land under the MRTP Act or  under the LA Act are commenced. Secondly, if the first part of Sec- tion 127 is not complied with or no steps are taken, then the second  part of Section 127 will come into operation, under which a period  of six months is provided from the date on which the notice has  been served by the owner within which the land has to be acquired  or the steps as aforesaid are to be commenced for its acquisition.  

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The six-month period shall commence from the date the owner or  any person interested in the land serves a notice on the planning au- thority, development authority or appropriate authority expressing  his intent claiming dereservation of the land. If neither of the things  is done,  the reservation shall lapse.  If there is no notice by the  owner or any person interested, there is no question of lapsing re- servation, allotment or designation of the land under the develop- ment plan.  Second part of Section 127 stipulates that the reserva- tion of the land under a development scheme shall lapse if the land  is not acquired or no steps  are taken for acquisition of the land  within the period of six months from the date of service of the pur- chase notice. The word “aforesaid” in the collocation of the words  “no steps as aforesaid are commenced for its acquisition” obviously  refers to the steps contemplated by Section 126 of the MRTP Act.

If no proceedings as provided under Section 127 are taken and as a  result thereof the reservation of the land lapses, the land shall be re- leased from reservation, allotment or designation and shall be avail- able to the owner for the purpose of development. The availability  of the land to the owner for the development would only be for the  purpose which is permissible in the case of adjacent land under the  relevant plan. Thus, even after the release, the owner cannot utilise  the land in whatever manner he deems fit and proper, but its utilisa- tion has to be in conformity with the relevant plan for which the ad- jacent lands are permitted to be utilised.”

(emphasis supplied)

Naolekar,  J.  then  referred  to  the  judgment  in  Dr.  Hakimwadi  Tenants’  

Association (supra) and observed:

“52. ………….Thus,  after  perusing the  judgment  in  Municipal  Corpn. of Greater Bombay case we have found that the question for  consideration  before  the  Court  in  Municipal  Corpn.  of  Greater  Bombay case has reference to first step required to be taken by the  owner after lapse of 10 years' period without any step taken by the  authority for acquisition of land, whereby the owners of the land  served the notice for dereservation of the land. The Court was not  called upon to decide the case on the substantial step, namely, the  step taken by the authority within six months of service of notice by  the owners for dereservation of their land which is second step re- quired to be taken by the authority after service of notice.

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53. The observations of this Court regarding the linking of word  “aforesaid”  from the wordings “no steps  as  aforesaid are  com- menced for its acquisition” of Section 127 with the steps taken by  the competent authority for acquisition of land as provided under  Section 126(1) of the MRTP Act, had no direct or substantial nexus  either with the factual matrix or any of the legal issues raised before  it. It is apparent that no legal issues, either with respect to interpret- ation of words  “no steps as aforesaid are commenced for its ac- quisition” as stipulated under the provisions of Section 127 or any  link of these words with steps to be taken on service of notice, were  contended before the Court. Thus, observations of the Court did not  relate to any of the legal questions arising in the case and, accord- ingly, cannot be considered as the part of ratio decidendi. Hence, in  light of the aforementioned judicial pronouncements,  which have  well settled the proposition that only the ratio decidendi can act as  the binding or authoritative precedent, it is clear that the reliance  placed on mere general observations or casual expressions of the  Court, is not of much avail to the respondents.

54. When we conjointly read Sections 126 and 127 of the MRTP  Act, it is apparent that the legislative intent is to expeditiously ac- quire  the  land  reserved  under  the  Town Planning Scheme and,  therefore, various periods have been prescribed for acquisition of  the owner's property. The intent and purpose of the provisions of  Sections 126 and 127 has been well explained in   Municipal Corpn.    of Greater Bombay case  . If the acquisition is left for time imme  -   morial in the hands of the authority concerned by simply making an  application to the State Government for acquiring such land under  the LA Act, 1894, then the authority will simply move such an ap- plication and if no such notification is issued by the State Govern- ment for one year of the publication of the draft regional plan under  Section 126(2) read with Section 6 of the LA Act, wait for the noti- fication to be issued by the State Government by exercising suo  motu power under sub-section (4) of Section 126; and till then no  declaration could be made under Section 127 as regards lapsing of  reservation and contemplated declaration of land being released and  available for the landowner for his utilisation as permitted under  Section 127. Section 127 permitted inaction on the part of the ac- quisition authorities for a period of 10 years for dereservation of the  land. Not only that, it gives a further time for either to acquire the  land or to take steps for acquisition of the land within a period of  six months from the date of service of notice by the landowner for  dereservation. The steps towards commencement of the acquisition  in such a situation would necessarily be the steps for acquisition  

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and not a step which may not result into acquisition and merely for  the purpose of seeking time so that Section 127 does not come into  operation.

56. The underlying principle  envisaged  in  Section 127  of  the  MRTP Act is either to utilise the land for the purpose it is reserved  in the plan in a given time or let the owner utilise the land for the  purpose it is permissible under the town planning scheme. The step  taken under the section within the time stipulated should be towards  acquisition of land. It is a step of acquisition of land and not step  for acquisition of land. It is trite that failure of authorities to take  steps which result in actual commencement of acquisition of land  cannot be permitted to defeat the purpose and object of the scheme  of acquisition under the MRTP Act by merely moving an applica- tion requesting the Government to acquire the land, which Govern- ment may or may not accept. Any step which may or may not cul- minate in the step for acquisition cannot be said to be a step to- wards acquisition.

57.  It may also be noted that the legislature while enacting Sec- tion 127 has deliberately used the word “steps” (in plural and not in  singular) which are required to be taken for acquisition of the land.  On construction of Section 126 which provides for acquisition of  the land under the MRTP Act, it is apparent that the steps for ac- quisition of the land would be issuance of the declaration under  Section  6  of  the  LA Act.  Clause  (  c  )  of  Section  126(1)  merely    provides for a mode by which the State Government can be reques- ted for the acquisition of the land under Section 6 of the LA Act.  The making of an application to the State Government for acquisi- tion of the land would not be a step for acquisition of the land under  reservation. Sub-section (2) of Section 126 leaves it open to the  State Government either to permit the acquisition or not to permit,  considering the public purpose for which the acquisition is sought  for by the authorities.  Thus, the steps towards acquisition would  really commence when the State Government permits the acquisi- tion and as a result thereof publishes the declaration under Section  6 of the LA Act.

58. The MRTP Act does not contain any reference to Section 4  or Section 5-A of the LA Act. The MRTP Act contains the provi- sions relating to preparation of regional plan, the development plan,  plans for comprehensive developments, town planning schemes and  in such plans and in the schemes, the land is reserved for public  purpose. The reservation of land for a particular purpose under the  

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MRTP Act is done through a complex exercise which begins with  land use map, survey, population studies and several other complex  factors. This process replaces the provisions of Section 4 of the LA  Act and the inquiry contemplated under Section 5-A of the LA Act.  These provisions are purposely excluded for the purposes of ac- quisition under the MRTP Act. The acquisition commences with the  publication of declaration under Section 6 of the LA Act. The pub- lication of the declaration under sub-sections (2) and (4) of Section  126 read with Section 6 of the LA Act is a sine qua non for the  commencement of any proceedings for acquisition under the MRTP  Act. It is Section 6 declaration which would commence the acquisi- tion proceedings under the MRTP Act and would culminate into  passing of an award as provided in sub-section (3) of Section 126  of the MRTP Act. Thus, unless and until Section 6 declaration is is- sued, it cannot be said that the steps for acquisition are commenced.

59. There is another aspect of the matter. If we read Section 126  of the MRTP Act and the words used therein are given the verbatim  meaning,  then the  steps  commenced  for  acquisition of  the  land  would not include making of an application under Section 126(1)(c)  or the declaration which is to be made by the State Government un- der sub-section (2) of Section 126 of the MRTP Act.

60. On a conjoint reading of sub-sections (1), (2) and (4) of Sec- tion 126, we notice that Section 126 provides for different steps  which are to be taken by the authorities for acquisition of the land  in different eventualities and within a particular time span. Steps  taken for acquisition of the land by the authorities under Clause (c)  of Section 126(1) have to be culminated into Section 6 declaration  under the LA Act for acquisition of the land in the Official Gazette,  within a period of one year under the proviso to sub-section (2) of  Section 126. If no such declaration is made within the time pre- scribed, no declaration under Section 6 of the LA Act could be is- sued under the proviso to sub-section (2) and no further steps for  acquisition of the land could be taken in pursuance of the applica- tion moved to the State Government by the planning authority or  other authority.

61. Proviso to sub-section (2) of Section 126 prohibits publica- tion of the declaration after the expiry of one year from the date of  publication of draft regional plan, development plan or any other  plan or scheme. Thus, from the date of publication of the draft re- gional plan, within one year an application has to be moved under  Clause (c) of Section 126(1) which should culminate into a declara- tion under Section 6 of the LA Act. As per the proviso to sub-sec-

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tion (2) of Section 126, the maximum period permitted between the  publication of a draft regional plan and declaration by the Govern- ment in the Official Gazette under Section 126(2) is one year. In  other words, during one year of the publication of the draft regional  plan, two steps need to be completed, namely, (i) application by the  appropriate authority to the State Government under Section 126(1) (c); and (ii) declaration by the State Government on receipt of the  application mentioned in Clause (c) of Section 126(1) on satisfac- tion of the conditions specified under Section 126(2). The only ex- ception to this provision has been given under Section 126(4).”

(emphasis supplied)

12. Recently,  another  three  Judge  Bench,  of  which  both  of  us  were  

members, considered the scope of Sections 126 and 127 of the 1966 Act in  

the  Civil  Appeal  arising  out  of  SLP(C)  No.9934  of  2009  Shrirampur  

Municipal  Council,  Shrirampur v.  Satyabhamabai  Bhimaji  Dawkher  and  

others  and  connected  matters  and  reiterated  the  view  expressed  by  the  

majority in Girnar Traders v. State of Maharashtra (supra).

13. In  the  last  mentioned  judgment,  the  Court  emphasized  that  if  any  

private land is shown as reserved in the Development plan, the same can be  

acquired within 10 years either by agreement or by following the procedure  

prescribed under the 1894 Act and if proceedings for the acquisition of the  

land are not commenced within that period and a further period of six months  

from the  date  of  service  of  notice  under  Section  127  of  the  1966  Act,  

reservation will be deemed to have lapsed and the land will be available for  

development by the owner.

14. By applying the ratio of the above-noted judgments to the facts of this  

case, we hold that the High Court did not commit any error by declaring that  

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reservation of the land owned by respondent No.1 had lapsed and the rejection  

of its application for construction of library building was legally unsustainable.  

Consequently, the appeal is dismissed.  

……..…..………………..J.        [G.S. Singhvi]

New Delhi,                                                            ……..….. ………………..J. April 4, 2013         [H.L. Gokhale]

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