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Non-Reportable

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.  10019  OF 2016 (Arising out of SLP(C) No.2725 of 2010)

Laljibhai Kadvabhai Savaliya & Ors.           ….Appellants

Versus State of Gujarat & Ors.  …. Respondents

With

CIVIL APPEAL NO.  10020  OF 2016 (Arising out of SLP(C) No. 2226/2010)

CIVIL APPEAL NOS.  10021-10050 OF 2016 (Arising out of SLP(C) Nos. 2228-2257/2010)

and CIVIL APPEAL NOS. 10051-10068 OF 2016 (Arising out of SLP(C) Nos. 2260-2277/2010)

J U D G M E N T  

Uday Umesh Lalit, J.

1. Leave granted.  These appeals take exception to the common judgment and

order dated 13.07.2009 passed by the High Court of Gujarat at Ahmedabad in

Special Civil Application Nos.5107 of 2008, 4321 of 2008, 824-853 of 2008

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and 899-916 of 2008.  Since all these appeals raise identical issues, they are

dealt with and disposed of by this common judgment.  

2. The Petroleum and Minerals Pipelines (Acquisition of Right of User in Land)

Act, 1962 (herein referred to as the “PMP Act”) was enacted by Parliament to

provide for the acquisition of right of user in land for laying pipelines for the

transport of petroleum and minerals and for incidental matters, with following

Statement of Objects and Reasons :-

       “As  a  result  of  the  implementation  of  plans  for  the development  of  petroleum  resources  in  the  country,  it  is anticipated that in the next few years there will be a substantial increase in the production of crude oil, natural gas and petroleum products by the public sector oilfields and refineries in India.  It has therefore become necessary to lay petroleum pipelines in the country to serve as an efficient and cheap means of transportation and distribution of petroleum and petroleum products.

2. Although land can  be  acquired  outright  for  laying such pipelines under the Land Acquisition Act, 1894 the procedure for such acquisition is long-drawn and costly.  Since the petroleum will  be  laid  underground  outright  acquisition  of  land  is  not necessary.   Therefore,  in  the  case  of  these  pipelines  it  is considered sufficient to acquire the mere right of user in the land for  laying  and  maintaining  the  pipelines.   The  Bill  seeks  to achieve the above purpose.   

3. The main features of the Bill are–  

(i). No right of user of land can be acquired for the purpose of laying  pipelines  unless  the  Central  Government  declares  its intention  by  Notification  in  the  Official  Gazette,  and  unless objections,  if  any,  filed  within  twenty-one  days  of  that Notification are disposed of by the competent authority.  

(ii). When final declaration about acquisition is made the right to use land for the purpose of laying pipelines will vest in the

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Central Government, State Government or the corporation, as the case may be but notwithstanding such acquisition, the owner or occupier  of  the  land  shall  be  entitled  to  use  the  land  for  the purpose for which such land was put to use immediately before the declaration by the Central Government.  But after the date of acquisition  he  shall  not  construct  any  building  or  any  other structure or construct or excavate any tank, well, reservoir or dam or plant any tree, on that land.   

iii). Compensation for the damage, loss or injury sustained by any person interested in the land shall be payable to such person. Besides  this,  compensation  calculated  at  ten  per  cent  of  the market  value  of  the  land  on  the  date  of  the  preliminary Notification is also payable to the owner and to any other person whose right of enjoyment in the land has been affected by reason of  the  acquisition.   The  compensation  in  both  cases  is  to  be determined by the competent authority in the first instance and an appeal lies from its decision to the District Judge.”   

3.    Section 2 of the PMP Act defines certain expressions. In terms of Section 3,

the Central Government is empowered to acquire the right of user in any land.

Under Section 4,  it  is  lawful for  any authorized person to enter upon and

cause survey in respect of such land.  Under Section 5, any person interested

in the land can object  to the laying of  the pipelines under the land.   The

objections so preferred are to be dealt with by the Competent Authority who

would then make a report for the decision of the Central Government.  Under

Section 6 if the Central Government is satisfied that the land is required for

laying any pipeline for transport of petroleum or any mineral, it may declare

so by Notification in the Official Gazette, whereafter the right of user shall

vest absolutely in the Central Government or in the State Government or the

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Corporation as directed.  After the right of user stands so vested it is lawful to

lay pipelines in terms of Section 7.  Section 9 incorporates certain restrictions

regarding the use of such land and Section 10 lays down principles for award

of compensation in respect of acquisition of the right of user of any land and

also in respect of any damage or loss sustained by any person interested in the

land.  The relevant Sections namely Sections 2, 3, 6, 7, 9 ,10 and 18 of the

PMP Act are as under:-

“2.  Definitions.  –  In  this  Act,  unless  the  context  otherwise requires–  

(a)  "competent  authority"  means  any  person  or  authority authorised  by  the  Central  Government,  by  Notification  in  the Official  Gazette,  to  perform  the  functions  of  the  competent authority under this Act 1 and different persons or authorities may be  authorised  to  perform  all  or  any  of  the  functions  of  the competent authority under this Act in the same area or different areas specified in the Notification;  

(b) "corporation" means anybody corporate established under any Central, Provincial or State Act, and includes—  

(i) a company formed and registered under the Companies Act, 1956; and  

(ii)  a  company  formed  and  registered  under  any  law relating to companies formerly in force in any part of India;

(ba) "minerals" have the meanings assigned to them in the Mines Act,  1952 (35 of 1952),  and include mineral  oils and stowing sand but do not include petroleum;  

(c) "petroleum" has the same meaning as in the Petroleum Act, 1934 (30 of 1934), and includes natural gas and refinery gas;

(d) "prescribed" means prescribed by rules made under this Act.

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3. Publication  of  Notification  for  acquisition.–  (1)  Whenever  it appears to the Central Government that it is necessary in the public interest that for the transport of petroleum 2 or any mineral] from one  locality  to  another  locality  pipelines  may  be  laid  by  that Government or by any State Government or a corporation and that for the purpose of laying such pipelines it is necessary to acquire the right of user in any land under which such pipelines may be laid,  it  may, by  Notification  in  the  Official  Gazette,  declare  its intention to acquire the right of user therein.  

(2)  Every  Notification  under  sub-section  (1)  shall  give  a  brief description of the land.  

3)  The  competent  authority  shall  cause  the  substance  of  the Notification to be published at such places and in such manner as may be prescribed.

6. Declaration of acquisition of right of user.– (1) Where no objections under subsection (1) of section 5 have been made to the competent authority within the period specified therein or  where  the  competent  authority  has  disallowed  the objections under sub-section (2) of that section, that authority shall, as soon as may be, 1 either make a report in respect of the land described in the Notification under sub-section (1) of section  3,  or  make  different  reports  in  respect  of  different parcels of such land, to the Central Government containing his  recommendations  on  the  objections,  together  with  the record of the proceedings held by him, for the decision of that Government  and  upon  receipt  of  such  report  the  Central Government shall  if satisfied that such land is required for laying  any  pipeline  for  the  transport  of  petroleum  or  any mineral, declare, by Notification in the Official Gazette, that the right of user in the land for laying the pipelines should be acquired and different declarations may be made from time to time in respect of different parcels of the land described in the Notification  issued  under  sub-section  (1)  of  section  3, irrespective of  whether one report  or  different  reports have been made by the competent authority under this section.  

(2) On the publication of the declaration under sub-section (1), the right of user in the land specified therein shall vest absolutely in the Central Government free from all encumbrances.

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(3) Where in respect of any land, a Notification has been issued under sub-section (1) of section 3 but 3no declaration in respect of  any  parcel  of  land  covered  by  that  Notification  has  been published under this section within a period of one year from the date  of  that  Notification,  that  Notification shall  cease to  have effect on the expiration of that period.  

(3A)  No  declaration  in  respect  of  any  land  covered  by  a Notification issued under subsection (1) of section 3, published after the commencement of the Petroleum Pipelines (Acquisition of Right of User in Land) Amendment Act, 1977 (13 of 1977), shall  be made after the expiry of three years from the date of such publication.  

(4)  Notwithstanding anything contained in sub-section (2),  the Central Government may, on such terms and conditions as it may think fit to impose, direct by order in writing, that the right of user in the land for laying the pipelines shall, instead of vesting in the Central Government vest, either on the date of publication of the declaration or, on such other date as may be specified in the  direction,  in  the  State  Government  or  the  corporation proposing to lay the pipelines and thereupon the right of such user  in  the  land shall,  subject  to  the  terms  and  conditions  so imposed,  vest  in that  State Government or  corporation,  as  the case may be, free from all encumbrances.

7. Central  Government  or  State  Government  or corporation to lay pipelines.– (1) Where the right of user in any land  has  vested  in  the  Central  Government  or  in  any  State Government or Corporation under section 6–  

(i)  it  shall  be lawful for any person authorised by the Central Government  or  such  State  Government  or  corporation,  as  the case may be, and his servants and workmen to enter upon the land and lay pipelines or to do any other act necessary for the laying of pipelines:  

Provided that no pipeline shall be laid under–

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(a)  any  land  which,  immediately  before  the  date  of  the Notification  under  sub-section  (1)  of  section  3,  was  used  for residential purposes;  

(b)  any  land  on  which  there  stands  any  permanent  structure which was in existence immediately before the said date;  

(c) any land which is appurtenant to a dwelling house; or  

(d) any land at a depth which is less than one metre from the surface;  

(ia) for laying pipelines for the transport of petroleum, it shall be lawful for any person authorised by the Central Government or such State Government or corporation to use such land for laying pipelines for transporting any mineral and where the right of user in any land has so vested for laying pipelines for transporting any mineral, it shall be lawful for such person to use such land for laying pipelines for transporting petroleum or any other mineral; and  

(ii) such land shall be used only for laying the pipelines and for maintaining, examining, repairing, altering or removing any such pipelines  or  for  doing any other  act  necessary  for  any of  the aforesaid purposes or for the utilisation of such pipelines.  

(2) If any dispute arises with regard to any matter referred to in paragraph (b) or paragraph (c) of the proviso to clause (i) of sub- section  (1),  the  dispute  shall  be  referred  to  the  competent authority whose decision thereon shall be final.

9. Restrictions regarding the use of land.– (1) The owner or occupier of the land with respect to which a declaration has been made under sub-section (1) of section 6 shall be entitled to use the land for the purpose for which such land was put to use immediately before the date of the Notification under sub-section (1) of section 3:  

Provided  that,  such  owner  or  occupier  shall  not  after  the declaration under sub-section (1) of section 6 –  

(i) construct any building or any other structure;

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(ii) construct or excavate any tank, well, reservoir or dam; or  

(iii) plant any tree, on that land.  

(2) The owner or occupier of the land under which any pipeline has been laid not do any act or permit any act to be done which will or is likely to cause any damage in any manner whatsoever to the pipeline.  

(3)  Where  the  owner  or  occupier  of  the  land  with  respect  to which  a  declaration  has  been  made  under  sub-section  (1)  of section 6-  

(a) constructs any building or any other structure, or  

(b) constructs or excavates any well, tank, reservoir or dam, or  

(c) plants any tree,  on  that  land,  the  Court  of  the  District  Judge  within  the  local limits  of  whose  jurisdiction  such  land  is  situate  may,  on  an application  made  to  it  by  the  competent  authority  and  after holding  such  inquiry  as  it  may  deem  fit,  cause  the  building, structure, reservoir, dam or tree to be removed or the well or tank to be filled up, and the costs of such removal or filling up shall be recoverable from such owner or occupier in the same manner as if the order for the recovery of such costs were a decree made by that Court.

10. Compensation.– (1) Where in the exercise of the powers conferred by section 4, section 7 or section 8 by any person, any damage, loss or injury is sustained by any person interested in the land under which the pipeline is proposed to be, or is being, or has been laid, the Central Government, the State Government or the corporation,  as  the case may be,  shall  be liable  to pay compensation to such person for such damage, loss or injury, the amount of which shall be determined by the competent authority in the first instance.  

(2) If the amount of compensation determined by the competent authority under subsection (1) is not acceptable to either of the parties,  the  amount  of  compensation  shall,  on  application  by

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either  of  the parties  to  the District  Judge within the limits  of whose jurisdiction the land or  any part  thereof  is  situated,  be determined by that District Judge.  

(3)  The  competent  authority  or  the  District  Judge  while determining  the  compensation  under  sub-section  (1)  or sub-section (2), as the case may be, shall have due regard to the damage or loss sustained by any person interested in the land by reason of—

(i)  the removal of  trees or  standing crops,  if  any, on the land while exercising the powers under section 4, section 7 or section 8;  

(ii) the temporary severance of the land under which the pipeline has been laid from other lands belonging to, or in the occupation of, such person; or  

(iii)  any  injury  to  any  other  property,  whether  movable  or immovable, or the earnings of such persons caused in any other manner:  

Provided that in determining the compensation no account shall be taken of any structure or other improvement made in the land after the date of the Notification under sub-section (1) of section 3.  

(4) Where the right of user of any land has vested in the Central Government,  the  State  Government  or  the  corporation,  the Central Government, the State Government or the corporation, as the case may be, shall, in addition to the compensation, if any, payable under subsection (1), be liable to pay to the owner and to any other person whose right of enjoyment in that land has been affected in any manner whatsoever by reason of such vesting, compensation calculated at ten per cent. of the market value of that land on the date of the Notification under sub-section (1) of section 3.  

(5)  The  market  value  of  the  land  on  the  said  date  shall  be determined  by  the  competent  authority  and  if  the  value  so determined by that  authority is not  acceptable to either  of the parties,  it  shall,  on  application  by either  of  the  parties  to  the

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District Judge referred to in subsection (2), be determined by that District Judge.  

(6) The decision of the District Judge under sub-section (2) or sub-section (5) shall be final.

18. Application of other laws not barred. – The provisions of this Act shall be in addition to and not in derogation of any other law for the time being in force relating to acquisition of land.

4. In exercise of the powers conferred by Section 3 of the PMP Act, the Central

Government by Notification published on 07.01.2006 in the Gazette of India

declared its intention to acquire the right of user in respect of certain lands.

Said Notification was as under:-

“Whereas it appears to the Central Government that it is necessary  in  the  public  interest  that  for  the  transportation  of natural  gas  through  an  interconnection  between Jamnagar-Bhopal  and  Kakinada-Hyderabad-Goa  pipeline  a pipeline should be laid by Gas Transportation and Infrastructure Company Ltd1.

And whereas it appears to the Central Government that for the purpose of laying the said pipeline, it is necessary to acquire the right of user in land under which the said pipeline is proposed to be laid and which is described in the Schedule annexed to this Notification.  

Now, therefore,  in exerciser  of  the powers conferred by sub-section  (1)  of  Section  3  of  the  Petroleum  and  Minerals Pipelines (Acquisition of Right of User in Land) Act, 1962 (50 of 1962), the Central Government hereby declares its intention to acquire the right of user therein.  

1

The name has since then been changed to Reliance Gas Transportation Infrastructure Ltd.

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Any person interested  in  the  land  described  in  the  said Schedule may, within twenty one days from the date on which the  copies  of  this  Notification  as  published  in  the  Gazette  of India under sub-section (1) of Section 3 of the said Act, are made available  to  the  general  public,  object  in  writing  to  the acquisition of the right of user therein for laying of the pipeline under the land to Shri A.K. Sanghavi, Competent Authority, Gas Transportation  and  Infrastructure  Company  Limited  Pipeline Project,  Anand Mahal  Apartment,  Opposite  to  Bhulka  Bhavan School, Anand Mahal Road, Surat-395009, Gujarat.”

The  Notification  set  out  details  of  survey  numbers  of  lands  from

different villages and the extent of land in respect of which right of user was

sought to be acquired.   

5. In  these  matters  we  are  concerned  with  Block  Nos.331,  342  and  364  of

Village  Gothan,  District  Surat  which  were  mentioned  in  the  aforesaid

Notification published on 07.01.2006. In so far as Block No.331 is concerned,

non-agricultural permission was granted on 03.03.1982.  However, since there

was  no  construction  within  the  stipulated  time,  this  non-agricultural

permission is said to have lapsed by efflux of time. In any case the land had

always been shown as agricultural land in Revenue Records. The appellant

Nos.1  to  3 in  appeal  arising  from SLP(Civil)  Nos.2228-2257 of  2010 are

stated to have purchased land admeasuring 29,370 sq.mtrs. and 8,531 sq.mtrs.

from  Block  No.331  and  thereafter  sold  sub-plots  to  about  70  persons

including appellant Nos.4 to 29 in that appeal.  The appellant No.1 in appeal

arising out from SLP(Civil) Nos.2260-2277 of 2010 along with his brother is

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said to have purchased land admeasuring 50,691 sq.mtrs.  from Block Nos.

342 and 364 and sold individual plots from that land to 68 persons including

appellant Nos.2 to 18 in said appeal.  

6. On 07.03.2006, One Mr. V.I. Gohil, retired Deputy Collector was appointed as

Competent Authority vide Notification dated 7.03.2006 issued by the Central

Government  which  was  published  on  11.03.2006  in  the  Official  Gazette.

Thereafter  all  the  recorded owners  were  sought  to  be served with  notices

inviting them to prefer objections to the proposed acquisition of right of user.

Some  of  the  land-owners  filed  their  objections  in  respect  of  proposed

acquisition.  The Competent  Authority  had fixed the hearing on 2.08.2007.

After  considering  the  objections  and  hearing  those  who  were  present

including appellant  No.1  Laljibhai,  the Competent  Authority  forwarded its

Report dated 7.08.2007 to the Central Government. The report indicates that

the Competent Authority had held meetings with the owners/occupiers as well

as the representatives of RGTIL. The report further shows that the average

rate  at  which  the  lands  in  village  Gothan  were  sold  during  the  years

2002-2005  was  Rs.13.40  per  sq.mtr.   The  compensation  determined  by

consent was Rs.181/- per sq.mtr. including damages under Section 10(1) for

lands other than those falling in industrial zone.  For those lands falling in

industrial zone, the compensation was increased to the level of Rs.201/- per

sq.mtr. by consent.  Ninety percent of this compensation was paid in advance.

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Thereafter,  spot  verification  was  undertaken  and  photographs  were  taken

which show that there was no construction on the lands in question. In the

meantime,  by  order  dated  29.03.2007  District  Panchayat  Office,  Revenue

Branch,  Surat  had  accorded  permission  for  conversion  of  certain  lands

including Block Nos.342 and 364 of village Gothan to non-agricultural use

for  the  industrial  purposes.   The  order  shows that  the  steps  to  seek  such

permission were taken and the recommendations in that behalf were made

after the publication of the aforesaid Notification on 7.01.2006.  

7.  After  considering the  report  of  the  Competent  Authority, by  Notification

dated 17.11.2007 issued in exercise of the powers conferred by Section 6 of

the  PMP Act,  the  Government  of  India  directed  that  the  right  of  user  in

respect of land mentioned in said Notification dated 17.11.2007 shall stand

vested in M/s Reliance Gas Transportation Infrastructure Ltd. (“RGTIL” for

short) free from all encumbrances.  The Notification reads as under:-

“S.O. Whereas by Notification of the Government of India in the Ministry of Petroleum and Natural Gas Number S.O. 41 dated  06th January,  2006,  issued  under  the  sub-section  (1)  of Section 3 of the Petroleum and Minerals Pipelines (Acquisition of Right of User in Land) Act,  1962 (50 of 1962) (hereinafter referred to as the said Act), the Central Government declared its intention to acquire the right of user in the land, specified in the Schedule appended to that Notification for the purpose of laying Kakinada-Hyderabad-Uran-Ahmedabad  gas  pipeline  for transportation of natural gas by M/s Reliance Gas Transportation Infrastructure Limited to various Consumers of District Surat in the State of Gujarat

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And, whereas copies of the said Gazette Notification were, made available to the public on or before 08th September, 2007;

And whereas, the objections received from the public to the laying of the pipeline have been considered and disallowed by the Competent Authority;

And  whereas  the  competent  authority  has,  under sub-section (1) of Section 6 of the said Act, submitted reports to the Government of India;

And whereas  the  Central  Government,  after  considering the  said  report  and  on  being  satisfied  that  the  said  land  is required for laying the pipeline, has decided to acquire the right of user therein;

Now, therefore,  in  exercise  of  the  powers  conferred  by sub-section  (1)  of  Section  6  of  the  said  Act,  the  Central Government hereby declares that  the right  of  user  in the land specified in the Schedule appended to this Notification is hereby acquired for laying the pipeline;  

And,  further,  in  exercise  of  the  powers  conferred  by sub-section  (4)  of  Section  6  of  the  said  Act,  the  Central Government hereby directs that the right of user in the said land for  laying the pipeline shall,  instead of  vesting in the Central Government,  vest,  on  the  date  of  the  publication  of  the declaration,  in  M/s  Reliance  Gas  Transportation  Infrastructure Limited free from all encumbrances.”

The Schedule appended to the Notification included Block Nos.331,

342 and 364 of village Gothan and the extent of land in respect of which right

to user was acquired from these Blocks was mentioned as 2295 sq.mtrs., 5047

sq. mtrs. and 3424 sq. mtrs respectively.

8.   In the physical verification of Block Nos.342 and 364 carried out in January,

2008,  it  was  seen  that  some  of  the  owners  had  commenced  construction

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activities.  A  communication  was  therefore  addressed  by  the  Competent

Authority on 08.01.2008 to the District Development Officer, Surat annexing

Notifications issued under Sections 3 and 6 of the PMP Act.  Around this time

the  owners/occupiers  of  Block  Nos.331,  342  and  364  filed  Special  Civil

Application Nos.824-898 of 2008 and Nos.899-966 of 2008 before the High

Court of Gujarat seeking declaration that RGTIL had no authority to enter the

lands of said owners/occupiers and that it be accordingly restrained. Notices

were issued in the aforesaid Special  Civil  Applications on 04.02.2008 and

according  to  the  respondents  therein,  it  was  only  then  it  came  to  their

knowledge that non-agricultural permissions were granted on 03.03.1982 in

respect of Block No.331 and on 29.03.2007 in respect of Block Nos.342 and

364. RGTIL challenged these non-agricultural permissions by filing Special

Civil Application Nos.2252 of 2008 and 3380 of 2008. The High Court by its

interim orders dated 06.02.2008 in Special Civil Application No.2252 of 2008

and  21.02.2008 in Special  Civil  Application No.3380 of  2008 stayed the

operation  of  non-agricultural  permissions  in  respect  of  aforesaid  Block

Nos.342, 364 and 331. These interim orders as well as the orders refusing

interim  relief  in  Special  Civil  Application  Nos.8992  and  996  of  2008

preferred  by  the  owners/occupiers  themselves,  were  challenged  by  filing

Letters Patent  Appeals.  In those  appeals,  the Division Bench of the High

Court permitted RGTIL who had by then started laying the pipelines to cover

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the ditches and to produce the memorandum to that effect in Special Civil

Application Nos.899-966 of 2008 and in 2252 of 2008.

9. The owners/occupiers of Block Nos.342 and 364 also preferred Special Civil

Application  No.5107  of  2008  on  or  about  24.03.2008  challenging  the

Notification issued by the Central Government under Section 6 of the PMP

Act. This Special Civil Application No.5107 of 2008 was heard along with

other Special Civil Applications referred to herein above and the High Court

by its order dated 11.07.2008 held that the balance of convenience was in

favour  of  RGTIL  and  as  such  the  prayers  for  interim  relief  by  the

owners/occupiers were rejected. The High Court recorded the statement of the

Counsel who appeared for RGTIL that it would deposit with the Competent

Authority  provisional  compensation  @  Rs.300/-  per  sq.mtr.  for  the  lands

including constructions thereon. Accordingly provisional compensation at the

aforesaid rate was deposited by RGTIL with the Competent Authority.  

10.   Thereafter, number of petitioners namely 70 from Special Civil Application

No.5107 of 2008, 150 from Special Civil Application No.4321 of 2008, 75

from Special  Civil  Application Nos.824-853 of 2008 and 68 from Special

Civil Application Nos.899-916 of 2008 withdrew their challenge, leaving the

remaining petitioners to contest the matter. The Division Bench of the High

Court by its judgment and order dated 13.07.2009, which is presently under

appeal,  disposed  of  aforesaid  Special  Civil  Application  Nos.824-853,

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899-966, 5107 and 4321 of 2008 filed by the owners/occupiers and Special

Civil Application Nos.2252 and 3380 of 2008 filed by RGTIL with following

observations:-

“Learned counsel for the landowners fairly submitted that none of the petitioners have challenged the validity of Section 3(1) Notification.  No grievance is also raised before us in these proceedings against the order passed by the competent authority under sub-section (2) to Section 5 of the Act……….

We find that the pipelines have already been laid over the properties of the petitioners.  Petitioners had not challenged at any point of time the Notification issued under Section 3(1) of the Act.   Majority of the petitioners have withdrawn from the writ  petitions as a whole.  So far as remaining petitioners are concerned, it seems that their grievance is only about inadequacy of compensation.  Section 10 of the Act specifically says that if any party has any grievance with regard to any damage, loss, injury or inadequacy of compensation, they can always approach the District Judge within the limits of whose jurisdiction the land is situated. Since effective remedy is provided under the Act, this Court under writ  jurisdiction is not justified in expressing any opinion regarding various contentions raised by the petitioners, especially  when  Section  3(1)  Notifications  has  not  been challenged and also due to the fact that pipelines have already been laid down.

Under the circumstances, all these matters are disposed of with  a  direction  that  if  the  petitioners  are  aggrieved they can approach  the  concerned  District  Judge  claiming  compensation and obtain appropriate orders in accordance with law.”

11. These  appeals  at  the instance  of  the owners/occupiers  challenge the

correctness of the decision of the High Court.  RGTIL however accepted the

judgment and did not prefer any challenge.  It may be mentioned that the very

same owners/occupiers had also filed Writ Petition No.569 of 2009 in this

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Court  challenging  the  vires  of  some  of  the  provisions  of  the  PMP Act.

However at the request of the petitioners, said Writ Petition No.569 of 2009

was allowed to be withdrawn on 07.01.2010.  While the aforesaid matters

were  pending,  in  another  batch  of  matters  the  question  of  bias  of  the

Competent Authority was put in issue.  Those matters were allowed by this

Court  by  its  decision  reported  in  Trilok Sudhirbhai  Pandya  v. Union of

India and others.2  This Court directed Union of India to appoint another

person as Competent Authority for determination of compensation but made it

clear that the judgment therein would not affect any orders with regard to

acquisition of right of user.  

12. On  or  about  05.11.2011,  an  application  was  filed  on  behalf  of  the

appellants  herein  praying  that  appropriate  directions  be  issued  to  the

Competent  Authority  to  decide  the  compensation  payable  to  the

owners/occupiers under Section 9 as well as under Section 10 at the time of

taking actual possession. Thereafter, another application namely I.A. No.5 of

2013 was filed  seeking permission to  raise  additional  grounds.  By raising

these grounds, the appellants submitted that PMP Act and the rules framed

thereunder were violative of the constitutional framework.  This Court by its

order dated 10.02.2014 issued notices to State of Gujarat as well as to the

2

(2011) 10 SCC 203

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learned  Solicitor  General  of  India  in  aforesaid  I.A.  No.5  of  2013  and  by

subsequent order dated 02.02.2016, said application was allowed.  Union of

India and other respondents were permitted to file their affidavits in reply and

it was clarified that it would be permissible for any other interested person(s)

to  join  these  proceedings. Further,  by  order  dated  18.03.2016,  this  Court

stayed further proceedings before the Competent Authority.

13. Before we deal with the challenge raised in these appeals, it must be

noted that none of the landowners had challenged the validity of Section 3(1)

Notification issued in the instant case nor any grievance was raised against

the order passed by the Competent Authority under Section 5(2) of the PMP

Act.  Though a substantive Writ Petition challenging the vires of some of the

provisions  of  the  PMP  Act  was  filed,  that  petition  was  also  withdrawn,

without  seeking  any  liberty.   Even  then,  we  have  heard  the  submissions

regarding validity of the PMP Act.   We have heard Mr. Amar Dave, learned

Advocate  in  support  of  the  appeals,  Mr.  Ranjit  Kumar,  learned  Solicitor

General  of  India,  Dr. A.M.  Singhvi  and Mr. Paras  Kuhad,  learned Senior

Advocates  for  RGTIL,  Mr. Harin  Rawal  learned  Senior  Advocate  for  the

Competent  Authority, Mr. Preetesh  Kapoor, learned Advocate  for  State  of

Gujarat and Mr. K.K. Venugopal, learned Senior Advocate for the intervener

namely Gujarat State Petronet Ltd.

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14. On behalf of the appellants, it was submitted:-

A. Though under the PMP Act right of user simplicitor in respect of

notified  lands  is  acquired,  for  all  practical  purposes  the

owners/occupiers  stand  deprived  of  their  proprietary  interest  and

enjoyment of the lands in toto.  According to Section 9 the user of the

land  stands  frozen  for  all  times  to  come  and  the  owners/occupiers

would not be allowed to use or utilize the land for any construction.

The acquisition of right of user thus amounts to complete deprivation.  

B.   The PMP Act  is  a legislation to  bypass the due process of  law

contemplated under the Land Acquisition Act, 1894. The entire exercise

contemplated under the PMP Act is nothing but acquisition of the entire

interest of the owners/occupiers in respect of such land. Reliance was

placed  on  the  decision  of  this  Court  in  H.D.  Vora  v. State  of

Maharashtra and others.3

C. The  PMP  Act  was  enacted  in  1962  when  the  activities  like

production of crude oil, natural gas and petroleum products as well as

transportation  and  distribution  of  petroleum and  petroleum products

were exclusively in public sector.  The then Industrial Policy was relied

upon in support  of  this  submission.   Additionally, reliance was also

3

1984 SCR (2) 693/(1984) 2 SCC 337

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placed on the Statement of Objects and Reasons to submit that certain

expressions like “Corporation” appearing in Section 2(b) ought to be

construed to confine to Corporations in public sector and the PMP Act

ought not to be invoked in favour of a company in private sector.

D. Certain provisions of the PMP Act were highlighted to show that

there was complete absence of requisite framework leading to unfair

treatment to the land owners.  

1. The  Competent  Authority  is  to  discharge  important

functions  like  hearing  of  objections,  making  a  report  to  the

Central Government and deciding the quantum of compensation

in  the  first  instance.  However  unlike  other  pari  materia

enactments no qualifications are prescribed for appointment of a

person as Competent Authority.   

2. Upon publication of the declarations under Section 6(1),

the  right  of  user  in  the  lands  stands  vested  free  from  all

encumbrances.   The  statutory  scheme  shows  that  after  such

vesting, the compensation for the loss or injury suffered under

Sections 4, 7 and 8 and compensation under Section 10 is to be

determined.  Neither  the  Act  nor  the  Rules  contemplate  any

period  within  which  compensation  for  such  damage,  loss  or

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injury and compensation for acquisition of right of user is to be

deposited or paid.   

3. There are no guidelines in the PMP Act that the pipelines

should  be  laid in  such a  way so  as  to  cause  least  amount  of

damage or loss to the occupiers.    

15. In reply, it was submitted by the learned Solicitor General and all other

Counsel:-

A.   As laid down by  this Court in  Jilubhai Nanbhai Khachar and

others v. State of Gujarat and another4, the right of user is a property

right  which  can  be  acquired.  Further,  it  is  not  necessary  that  the

acquisition should be of “whole” of property rights or ownership rights.

The acquisition could be “partial” and the principles land down in the

PMP Act are designed to give fair and just compensation for acquisition

of such right of user.   B. Proviso to Section 7(1) of the PMP Act mandates that no pipeline

shall be laid under any land which was used for residential purposes, or

any land wherein any permanent structure was in existence before the

date on which Notification under Section 3(1) was issued or any land

which is appurtenant to a dwelling house.  The pipeline would be laid

4

(1995) Suppl 1 SCC 596

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under  lands  which  are  primarily  fallow  lands  or  those  used  for

agricultural  purposes.   After  the  pipeline  is  so  laid,  the  land  could

certainly be used for the purpose for which it was used before such

Notification  was  issued.   The  agricultural  operations  could  still  be

continued and the ownership in respect of land is left untouched.  The

vesting provisions of the PMP Act make it clear that it is an Act relating

to acquisition of a limited right namely the right of passage under the

sub-soil to enable the laying of pipelines. It would be incorrect to term

the PMP Act to be acquiring proprietary interest of the land owners in

the land or taking over their right to possess the lands in question.  

C. Relying  on  enactments  such  as   the  National  Highways  Act,

1956, the Railways Act, 1989, the Delhi Metro Railway (Construction

of Works) Act, 1978, the Indian Telegraph Act, 1885 it was submitted

that  for  sub-serving  the  societal  needs,  right  of  user  simplicitor  is

required to be acquired rather than acquiring the entirety of interest in

the land itself.   

D. The  definition  of  “Corporation”  is  wide  enough  to  include

Companies in Private Sector.  With the expanding frontiers where the

private  sector  is  allowed  entry  in  production  and  manufacture  of

petroleum, petroleum products and natural gas as well as transportation

thereof,  the  definition  of  “Corporation”  need  not  to  be  given  any

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restricted meaning.  Going by the Expression of Interest invited from

interested  parties  for  usage  of  the  pipelines  in  the  present  case,  the

pipeline was required to have such design capacity so as to offer on

common carrier basis.  Thus the pipeline itself  would be sub-serving

public interest. The length of the pipeline in question from Kakinada of

Gujarat  is  over  1470 kilometers  and if  the lands are  to be acquired

under Land Acquisition Act at every stage, it would lead to enormous

escalation in costs to the detriment of public interest.

E. The PMP Act and the Rules provide sufficient guidelines relating

to computation of compensation and deposit thereof. Section 10(1) of

the PMP Act provides for compensation for diminution in market value

as well and thus adequately protects the interest of the land owners.  In

any case, ninety percent of the compensation assessed to be payable to

land owners in the present case was already deposited.  Meetings were

held with the land owners and the representatives of RGTIL and the

amount of compensation was arrived at.  As against the prevailing rates

of  Rs.13.40  per  sq.mtr.,  the  compensation  was  given  at  the  rate  of

Rs.181/- per sq.mtr. for lands falling in zones other than industrial zone

and the compensation was given at the rate of Rs.201/- per sq.mtr. in

respect of lands falling in industrial zone.

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16. Under the provisions of the PMP Act, what is taken over or acquired is

the right of user to lay and maintain pipelines in the sub-soil of the land in

question.   The provisions of  the PMP Act get  attracted upon the requisite

Notification having been made under Section 3.  If it appears to the Central

Government that it is necessary in the public interest that for the transport of

petroleum or  any minerals  any pipeline  be  made  and for  the  purposes  of

laying such pipelines it is necessary to acquire the right of user in any land, it

may by Notification issued in exercise of power under Section 3 declare its

intention to acquire such right of user.  The Act then provides for making of

objections by those interested in land, which objections are thereafter to be

dealt with by the Competent Authority.  The report made by the Competent

Authority  is  then  placed  before  the  Central  Government  for  appropriate

decision and after considering such report and the relevant material on record,

if the Central Government is satisfied that such land is required for laying any

pipeline for the transport of petroleum or any other mineral, it may declare by

Notification in the official gazette that the right of user in the land for laying

the pipeline be  acquired.   Upon the publication of  such declaration under

Section 6 the right of user in the land so specified vests absolutely in the

Central Government or in the State Government or in the Corporation free

from all encumbrances.  Thus what stands acquired is the right of user in the

land in  question  for  laying pipeline  for  the  transport  of  petroleum or  any

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mineral and not the land itself.  The Statement of Objects and Reasons throws

light on this facet of the matter and shows that although the land could be

acquired outright for laying such pipelines under the Land Acquisition Act,

1894, such procedure for acquisition would be costly.  For instance, as the

facts of the present  case disclose the pipeline from Kakinada to Jamnagar

would be over 1470 kilometers in length.  If the lands were to be acquired

outright, it would lead to tremendous increase in costs finally reflecting in

escalation of the costs of petroleum or minerals.  At the same time, if at every

stage outright acquisition is to be insisted upon, many agriculturists would

stand  deprived  of  their  holdings  causing  great  prejudice.  The  Act  is  thus

designed to achieve the purpose of laying of the pipelines for petroleum and

minerals as “efficient and cheap means of transportation and distribution of

petroleum and petroleum products”.  At the same time Section 18 specifically

lays down that the provisions of the PMP Act shall be in addition and not in

derogation to any other law for the time being in force relating to acquisition

of land.  Thus in a given case where the circumstances and the occasions so

demand, a resort could still be taken to acquire the lands by relying upon the

general law of acquisition under the provisions of the Land Acquisition Act,

1894.  For instance, for monitoring the pressure gauges or in cases where

pipelines are branching in different directions, implementations to regulate the

flow may require permanent establishments necessitating acquisition of the

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land itself rather than acquisition of a mere right of user. The PMP Act is thus

a special enactment designed to achieve the purpose of laying pipelines as

efficient means of transportation and with this idea it is only the right of user

in the land to lay such pipelines is acquired.   

17. Section  7  stipulates  that  no  pipeline  be  laid  under  any  land  which,

immediately before the date of Notification under Section 3(1) was used for

residential  purposes,  or  any land on which there is  permanent structure in

existence or any land which is appurtenant to a dwelling house.  It is clear that

only such lands are to be considered for acquisition of right of user therein

which are either lying fallow or are being put to agricultural use.  It is obvious

that  care  is  taken  to  cause  least  possible  damage  to  the  holdings  of  the

concerned land-owners.  According to Section 9, after the pipelines are laid,

the owner/occupier could use the land for the purpose for which it was being

used  before  the  Notification  under  Section  3(1)  was  issued.   Section  9

certainly, imposes  some restrictions  in  the sense  that  such owner/occupier

cannot thereafter construct any building or any other structure or construct or

excavate any lake,  reservoir or dam or plant any tree on such land.  Barring

such restrictions, the owner/occupier is within his rights to use the land for the

same purpose for which the land was earlier being used.  The point is clear

that neither the ownership in respect of the land itself nor the right to occupy

or possess that land is taken over permanently and those rights continue to

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remain with the owner/occupier.  What is taken over is only the right of user

namely  to  lay  pipelines  in  the  sub-soil  of  the  land  in  question  and  the

restrictions imposed by Section 9 are designed to safeguard and secure the

pipelines underneath.

18. As laid down by this Court in Jilubhai Nanbhai Khachar and others

(Supra), the term property in legal sense means an aggregate of rights which

are guaranteed and protected by law and would extend to entirety or group of

rights inhering in a person.  It was observed by this Court as under:   

“42. Property in legal sense means an aggregate of rights which are guaranteed and protected by law.  It extends to every species  of  valuable  right  and  interest,  more  particularly, ownership and exclusive right to a thing, the right to dispose of the  thing  in  every  legal  way, to  possess  it,  to  use  it,  and  to exclude everyone else from interfering with it.  The dominion or indefinite  right  of  use  or  disposition  which one  may lawfully exercise over particular things or subjects is called property.  The exclusive right of possessing, enjoying, and disposing of a thing is property in legal parameters.  Therefore, the word ‘property’ connotes everything which is subject of ownership, corporeal or incorporeal,  tangible  or  intangible,  visible  or  invisible,  real  or personal;  everything that  has  an exchangeable value or  which goes to make up wealth or estate or status.  Property, therefore, within  the  constitutional  protection,  denotes  group  of  rights inhering citizen’s relation to physical thing, as right to possess, use  and dispose  of  it  in  accordance  with  law.  In  Ramanatha Aiyar’s  The Law Lexicon,  Reprint  Edn.,  1987, at p.1031, it  is stated that the property is the most comprehensive of all terms which can be used, inasmuch as it is indicative and descriptive of every  possible  interest  which  the  party  can  have.   The  term property has a most extensive signification, and, according to its legal definition, consists in free use, enjoyment, and disposition by  a  person  of  all  his  acquisitions,  without  any  control  or diminution, save only by the laws of the land.”

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19. We therefore proceed on the premise that the right of user sought to be

taken over under the provisions of the PMP Act amounts to acquisition of one

of the facets of property rights which inher in the owner/occupier.  For the

acquisition of such right of user, the compensation is prescribed in terms of

Section 10 of the PMP Act.  There are two elements of compensation under

Section 10.  The first part deals with any damage, loss or injury sustained by

any owner/occupier as a result of exercise of powers conferred by Sections

4,7  and 8 of the PMP Act that is to say the actual damage, loss or injury

sustained because of entry upon and/or digging or marking levels  and survey

of  land  under  Section  4  or  while  actual  laying  of  the  pipeline  including

digging of  trenches  and carrying of  requisite  material  for  such operations

under Section 7 or at any stage of maintenance, examinations, repairing and

altering or removing of pipeline in terms of Section 8 of the PMP Act. The

measure for determining such compensation is given with sufficient clarity in

sub-section (3) of Section (10).  The idea is to compensate the owner/occupier

for actual damage, loss or injury sustained by him as a result of the operations

carried out in terms of Section 4, Section 7 or Section 8 of the Act.  One of

the indicia under sub-Section 3 could be “any injury to any other property

whether movable or immovable, or the earnings of such persons in any other

manner”. All possible acts as a result  of which the damage, loss or injury

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could be so occasioned are taken care of and stipulated in said sub-section.

Over  and  above  such  compensation  for  actual  damage,  loss  or  injury,

additional compensation @ 10% of the market value of the land is given to

the owner/occupier under sub-section 4 of Section 10 for taking over the right

of  user  to  lay  the  pipelines.   This  element  of  additional  compensation  is

independent of any actual loss or damage and is purely linked to the value of

the land for the purposes of computation.  This element of compensation is

purely for acquisition of right of user simplicitor.  The damage/loss or injury

to the property is separately dealt with under first part of Section 10 and has

to be compensated in toto.   Theoretically, it is possible that in a barren piece

of land as a result of exercise of powers under Sections 4, 6 and 7 there may

not be any damage/loss or injury.  However compensation under sub-section

(4) for acquisition of right of user would still be independently payable.  The

expression “in addition to the compensation, if any, payable under sub-section

(1)” clearly shows the intent that the compensation for acquisition of right of

user shall be in addition to the actual damage/loss or injury under first part of

Section 10.  This part will also be clear from para (iii) of Statement of Objects

and Reasons extracted above.

20.     The provisions of PMP Act do specify the principles and the manner in

which the compensation is to be determined.  Not only the actual damage,

loss or injury suffered as a result of exercise of various activities in terms of

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Sections 4, 6 and 7 are compensated in toto but additionally compensation

linked to the market value of land is also to be given for acquisition of right of

user in respect of such land.  What is taken over is mere right of user to lay

the pipeline in the sub-soil of land in question, leaving the title to the land as

well  as  the  right  to  possess  that  land  intact  in  the  hands  of  the  land

owner/occupier. It is no doubt that the enjoyment thereof after the pipelines

are laid is impaired to a certain extent, in that the owner/occupier cannot raise

any  permanent  construction  or  cause  any  excavation  or  plant  any  trees.

Barring such restrictions, the enjoyment and the right of possession remains

unaltered.  The lands under which the pipeline would be laid are primarily,

going by the mandate of Section 7, agricultural or fallow and there would

normally be no occasion for any rendering of the holding completely unfit for

any  operations.   Even in  such  cases  where  the  holding is  rendered unfit,

sub-section 3(iii) of Section 10 could be relied upon and any diminution in

market  value  as  permanent  impairment  could  sustain  a  claim  for

compensation. The principles of compensation as detailed in the PMP Act are

thus reasonable and cannot in any way be termed as illusory.  The principle

laid down in H.D. Vora v. State of Maharashtra (Supra) has no application at

all.   

21. Coming to the facts of the present case, Block Nos.331, 342 and 364 of

village Gothan were agricultural lands and recorded so in the revenue records

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on the day the Notification under Section 3(1) was issued.  The permission to

convert Block Nos.342 and 364 to non-agricultural use was granted after such

Notification.  In any case, the compensation including damages, was arrived

at  by  consent  in  the  meeting  held  with  the  land  owners/occupiers  and

determined at  the  level  of  Rs.181/-  per  sq.mtr. for  lands  other  than those

falling in industrial zone and in respect of those falling in industrial zone, the

compensation was at Rs.201/- per sq.mtr.   If the average rate at which the

lands  were  sold  in  preceding  five  years  was  taken  into  account,  this

compensation was not inadequate.  In any case, while the matter was pending

in  the  High  Court,  provisional  compensation  @ Rs.300/-  per  sq.mtr.  was

deposited with the competent authority.  This compensation in our view, for

acquisition of right of user cannot be called inadequate or illusory on any

count.

22. We now turn to the submissions advanced with respect  to the terms

“Corporation” and “Competent Authority” under the PMP Act.

23. Natural  gas  is  one  of  the  most  important  and  environment  friendly

sources of energy.  Easy access to the deposits of natural gas and quick and

cost effective transportation thereof are critical for fulfilling basic necessities

of  the  society.   Petroleum  and  Natural  Gas  Regulatory  Board  Act,  2006

enacted by Parliament creates Petroleum and Natural Gas Regulatory Board

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to authorize entities to lay, build, operate or expand to a common carrier or

contract  carrier;  regulate  access  to  common  carrier  or  contract  carrier;

regulate transport rates and ensure adequate availability of natural gas and

secure  equitable  distribution  for  petroleum  products.   The  activity  of

transportation  of  gas  is  thus  recognized  as  an  activity  of  highest  national

importance  and  subjected  to  statutory  control  in  all  its  dimensions.

Transportation  of  natural  gas  requires  creation  of  necessary  infrastructure

either by the State on its own or through private enterprise.  The pipeline in

question was designed to sub-serve public interest and as rightly contended by

the  learned  Solicitor  General  the  element  of  public  interest  is  present  all

through, even when the activity is undertaken through an entity in private

sector. Considering the nature of activity where entities in private sector are

encouraged to participate, it would be incorrect to put any restricted  meaning

as  regards  the  expression “Corporation”.   The definition of  “Corporation”

under Section  2(b)  of  the  PMP  Act  is  wide  enough  to  include     entities

in private sector.  This definition is designedly kept wide enough to include all

such possibilities and there is no reason for giving any restricted meaning to

such  expression.   We,  therefore,  reject  the  submission  advanced  by  the

appellants.   

24. As per Section 2(a) of the PMP Act, “Competent Authority” means any

person  or  authority  authorized  by  the  Central  Government  to  perform

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functions  of  the  Competent  Authority  under  that  PMP Act.   According to

Section 5, all objections preferred by interested persons to the laying of the

pipeline are to be dealt with and heard by the Competent Authority, who may

allow or disallow such objections.  Under Section 5(3) the order so passed by

the Competent  Authority  is  to be final.   As per  Section 6,  the Competent

Authority  thereafter  has  to  make  a  report  to  the  Central  Government

containing his recommendations on the objections together with the record of

the  proceedings  held  by  him.   After  the  order  is  passed  by  the  Central

Government under Section 6(1), the role of the Competent Authority is to

assess compensation for damage, loss or injury occasioned to any person as a

result of exercise of the powers conferred under Sections 4, 7 and 8.  Section

10(3) obliges the Competent Authority inter alia to have due regard to facets

enumerated in sub clauses (i), (ii) and (iii) of  Section 10 (3). In addition, the

Competent Authority is also to determine the market value of the land, 10%

of which is required to be paid by way of compensation for acquisition of

right of user under Section 10 (4). Section 12 confers powers of Civil Court

on the Competent Authority.   

25. It  is  thus  clear  that  “Competent  Authority”  is  given  wide  ranging

powers under Section 5 for considering the objections, under Section 6 for

making  the  report  to  the  Central  Government  and  under  Section  10  for

determining  compensation  for  damage/loss  or  injury  under  first  part  of

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Section  and  to  determine  the  market  value  under  the  second  part  of  the

Section.  By virtue of these powers, crucial rights of the persons interested in

the land are bound to be affected.  His orders and report would certainly deal

with variety of civil rights of the interested persons and issues pertaining to

compensation.   At  this  stage,  the  observations  of  this  Court  in  Trilok

Sudhirbhai Pandya (Supra),  in the context whether the person appointed as

Competent Authority could be a person other than a public servant are quite

eloquent:-  

“17. The aforesaid reference to the various provisions of the Act shows that the competent authority has got vast powers, which affects the rights of  persons interested in the land over which  the  pipeline  is  to  be  laid  and  on  the  reports  of  the competent  authority,  the  Central  Government  and  the  State Government are to take decisions affecting the rights of persons interested in the land.  Under the provisions of the Act, therefore, the  competent  authority  does  not  merely  determine  the compensation  at  the  first  instance  in  accordance  with  the statutory rules as has been contended by the learned counsel for Respondent  4,  but  has  to  perform various  other  quasi-judicial functions  which  are  normally  performed  by  public  servants whose pay allowances and other incidentals of service are met out  of  the  public  exchequer.  If  instead  of  public  servants,  a person is appointed whose pay, allowances and other incidentals are not paid out of the public exchequer but directly paid by a private employer such as Respondent 4, for whom the right of user  is  being  acquired  and  by  whom  the  compensation  is payable,  persons  interested  in  the  land  will  have  reasonable grounds for  assuming that  such a competent  authority, who is dependent  on  a  private  corporation for  his  salary, allowances, accommodation  and  transport  allowances,  will  have  a  bias  in favour of the private corporation.”

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26. It is axiomatic that a person who occupies the position of Competent

Authority  under  the  PMP  Act  must  evoke  and  enjoy  public  confidence.

Neither the Act nor the Rules framed thereunder deal with the qualifications

required of a person before his appointment as Competent Authority nor do

they deal with any transparent process for such appointment. We may now

turn to see the requirements in  that  behalf  in  an enactment  which is  pari

materia.  Section  2(e)  of  the  Metro  Railway  (Construction  of  Works)  Act,

1978  (Metro  Act,  for  short),  defines  Competent  Authority  as  the  one

appointed under Section 16.  Section 16(2) then sets out, “a person shall not

be qualified for appointment as a Competent Authority unless he is holding,

or has held, a Judicial Office, not lower in rank than that of a Subordinate

Judge.”   Like  the  PMP Act,  the  Metro  Act  also  confers  power  upon  the

Competent Authority therein to consider objections to the construction of the

Metro Railway or any other work and to determine the amount payable for

acquisition.  The orders passed by the Competent Authority under the Metro

Act  are  also  appealable  before  an  Appellate  Authority.   In  our  view, the

Competent  Authority  under  the  provisions  of  the  PMP Act  must  also  be

someone who is holding or has held a Judicial Office not lower in rank than

that of a Subordinate Judge or is a trained legal mind. If such requirement is

not read into and not taken as an integral and essential qualification before

appointment  of  any person as  Competent  Authority, the provisions in  that

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behalf will not be consistent with the doctrine of fairness under Article 14 of

the Constitution of India.  At the same time, we hasten to add that actions

taken by the Competent Authority till now, will not in any way stand impaired

or be invalidated purely on this count.  But the Central Government may do

well  to  step  in  immediately  and  remedy  the  situation  with  appropriate

measures.   

27. Lastly, it is correct that the PMP Act and the Rules framed thereunder

do not stipulate any period within which compensation for damage, loss or

injury and compensation for acquisition of right of user is to be deposited.

While  damage,  loss  or  injury occasioned as  a  result  of  exercise  of  power

under Sections 4 and 7 could be one time damage, that in respect of Section 8

could re-occur as a result of repeated entries for maintenance.  Even when no

time limit is fixed, it is expected of the concerned authorities to determine and

deposit compensation within reasonable time.  In so far as the facts of the

present case are concerned, ninety percent of the amount so determined by the

Competent Authority in the first instance, was deposited in advance.   

28. We  thus  do  not  find  the  provisions  regarding  computation  of

compensation with regard to both elements under Section 10 of the PMP Act

to be invalid on any count.  We further find that the definition “Corporation”

is wide enough to take within its sweep entities in private sector as well.  We

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also do not find the provisions of the PMP Act to be lacking on any count,

except to the extent indicated above as regards appointment of Competent

Authority.  Civil Appeals are thus disposed of without any order as to costs.   

…………………….…J.      (V. Gopala Gowda)

  ..…………..…….……J.     (Uday Umesh Lalit)

New Delhi, October 05, 2016