Judgment:
Huluvadi G. Ramesh, J.
1. These two appeals have been preferred being aggrieved by the judgment and decree passed by the Civil Judge (Senior Division), Hubli, in R.A. No. 56 of 1992 wherein while reversing the finding of the Trial Court, the suit of the plaintiff has been decreed by allowing the appeal and directing 2nd defendant to execute registered conveyance deed in favour of the plaintiff in respect of the suit land by receiving a consideration of Rs. 1,50,000/-.
2. The plaintiff filed a suit against the Government of Karnataka represented by its Chief Secretary, Joint Director of Industries and Commerce and the Deputy Commissioner, Dharwad who are defendants 1 to 3. Defendants 4 to 6 are Basant Tiles and its partners to whom the 2nd respondent is said to have conveyed the suit property contrary to the compromise entered into between the plaintiff and the 3rd defendant before this Court in the writ petition.
3. Plaintiff was said to be the owner of property bearing Sy. No. 16/1A+1B/1A measuring 2.16 acres of Jangamarakoppa Village, Hubli. The said property was said to. be purchased by the plaintiff under a registered sale deed dated 16-6-1995 from its previous owners/trustees of Assar Masjid Committee, Hubli. The State Government is said to have started acquisition proceedings of the aforesaid proceedings for utilisation of land to the 2nd defendant and award was also passed by the Assistant Commissioner, Dharwad on 28-8-1967 and also possession of the above land was taken by 2nd defendant. The value of the land was fixed at Rs. 2,200/- per acre. Plaintiff being aggrieved by the acquisition/award of the Assistant Commissioner, has preferred a writ petition in W.P. No. 366 of 1969 before this Court. During the pendency of the writ petition, a compromise memo has been filed by the plaintiff and respondents 3 and 4 therein. In the said writ petition, petitioner 1 was the original owner Assar Masjid Trust Committee, 2nd petitioner was the plaintiff viz., Parashuram M. Shinde. The respondents were the State of Mysore, Assistant Commissioner, Dharwad and the 3rd and 4th respondents are Industrial Estate Establishment by its Managing Director, Bangalore and Administrative Officer, Industrial Estate, Hubli respectively. The compromise was entered into between the petitioners and the 3rd and 4th respondents. In the said compromise, as per agreement respondents 3 and 4 agreed to retain 1 acre to the North-South abutting on the western side of Sy. Nos. 16/2 and 16/3 out of Sy. No. 16/1A + 1B/1A and reconveying of the remaining 1.16 acres to the 2nd petitioner. As per the compromise, the area of 1.00 acre was retained by respondents 3 and 4 for their proposed administrative building with a condition that if they do not need the area of 1.00 acre retained by them, the said area will be reconveyed to the 2nd petitioner on a condition that the same area is used by him for industrial purpose in conformity with the developed area of respondents 3 and 4 therein.
4. In view of the above compromise, 2nd petitioner therein had restricted the claim for compensation only to the extent of 1.00 acre. Based on the said compromise, the writ petition came to be dismissed and also in furtherance of the compromise, 2nd defendant reconveyed the land measuring 1.16 acres in favour of the plaintiff out of 2.16 acres and retained only 1.00 acre for the purpose of construction of Administrative Block. In the plaint, it is further averred that 1.00 acre of land which was retained by 2nd defendant was being conveyed to the 4th defendant quoting the terms of compromise vide Order No. TES/HBL/Spl-Plot/A-8/94, dated 30-5-1984. In that letter, it is contended that the suit property was not required by 2nd defendant for purpose of construction of Administrative Building. In that event, 2nd defendant could not have reconveyed the suit property to the plaintiff as per the terms of the compromise. The 2nd defendant violating the terms of compromise, has conveyed the suit property to 4th defendant which is illegal and also in breach of the terms of the agreement. Further, stating that the plaintiff is ready and willing to pay back the compensation amount, has sought for to decree the suit by way of reconveying the suit property. The said suit was contested by the 2nd defendant stating that on account of the paucity of funds, the construction of administrative block and godown was not taken up immediately. However, in course of time, concerned files in which compromise petition was entered into had been bunched in disposed off files and the concerned officials who were handling the matter were also transferred. As such, the compromise petition and the terms therein were not within the personal knowledge of the officers and the officials of the defendants and the allotment of the suit schedule plot was made to the 4th defendant. However, soon after the relevant files were traced immediate action was taken on 16-8-1984 to withdraw the allotment and also after issuing a show-cause notice dated 21-8-1985, the allotment in favour of 4th defendant was cancelled on 31-12-1985. Meanwhile, the 4th defendant challenged the withdrawal of allotment in W.P. No. 13966 of 1984 before the High Court. The High Court quashed the order of withdrawal reserving liberty to the defendants to initiate action as per law after giving opportunity to the 4th defendant. The allotment is not valid in favour of the 4th defendant as the allotting authority viz., the Additional Director of Industries and Commerce had no authority to allot land in favour of 5th defendant and the allotment does not bind the 1st defendant. As such there is no valid allotment in the eye of law. There has been no violation of the terms of compromise entered into in W.P. No. 366 of 1969. Further, it is stated that there is no cause of action since the allotment in favour of 4th defendant was cancelled on 31-12-1985 and that defendants has a proposal and plan to construct a administrative building and godown for the purpose of its raw material department.
5. The 4th defendant also contended that he was not aware of the earlier compromise in W.P. No. 366 of 1969. The compromise/settlement alleged to have been entered into between the plaintiff and defendants 1 to 3 outside the Court does not derogate the absolute and unrestricted right of defendants 1 to 3 over the suit property under the award by virtue of operation of Section 16 of the Land Acquisition Act, 1894 and such a compromise does not create any fresh right in favour of the plaintiff. The restrictive terms of conditions as per the compromise as they impose absolute restraint of alienation which are repugnant to the interest created as per Sections 10 and 11 of the Transfer of Property Act, 1882. The alienation of the suit property by defendants 1 to 3 to the 4th defendant is for valuable consideration and is valid and legal. The need of defendants 1 to 3 of the suit property for the development of diverse and vast industrial purpose still subsists. As such, it cannot be stated that there is a breach of compromise of the terms. It is also contended that the 4th defendant is a bona fide purchaser for value without notice.
6. Further it is submitted that the lease-cum-sale is executed in favour of this defendant and since then, he has invested substantial amount for development towards industrial purpose and the plaintiff cannot be permitted to avail himself the improvements made by him and further, plaintiff cannot be permitted to dispossess this defendant from the suit property without paying him the amount invested on the property and the present value of the improvements effected and this defendant is ready and willing to purchase the disputed land. It is further contended that the suit is barred by limitation and also there is no cause of action accrued to the plaintiff.
7. Based on the above pleadings, as many as six issues were raised. Further, additional issues were also raised. After the trial, the suit of the plaintiff came to be dismissed by order dated 22-2-1992 by the Additional Munsiff, Hubli. Being aggrieved by the same, R.A. No. 56 of 1992 was filed before the Additional Civil Judge (Senior Division), Hubli. The said Court while reversing the finding of the Trial Court, has decreed the suit of the plaintiff. Thereby, it has directed the 2nd defendant to execute the reconveyance deed in favour of the plaintiff by receiving Rs. 2,000/- from the plaintiff and also with a direction to pay Rs. 1,50,000/- to the 4th defendant with a further direction to the plaintiff to utilise the suit land as per the compromise terms. Being aggrieved by the same, two appeals have been preferred separately - one by the 4th defendant-Basant Tiles in R.S.A. No. 137 of 2001 and the other by Chief Manager, Industrial Estate and the state Government in R.S.A. No. 215 of 2001.
8. The first two questions of law raised in the appeal memo are taken as the substantial questions of law for consideration of this Court. They are.
Whether the first Appellate Court is justified in law in granting a decree for reconveyance in the absence of any denotification made by the State Government under Section 48 of the Land Acquisition Act, 1894?
Whether in the facts arid circumstances of the case the appellant being a bona fide purchaser and when the plaintiffs were entitled only for damages, the first Appellate Court was justified in decreeing the suit for reconveyance?
Apart from the above two substantial questions of law, on 8-9-2005, the following three more substantial questions of law were raised by this Court to the effect.
Whether the suit was barred by limitation?
Whether there is any mandatory compliance of Section 80 of the CPC prior to the institution of suit?
Whether the compromise memo alleged to have been filed before this Court in W.P. No. 36G of 1969 is not binding on the appellant-Government since it has not signed the compromise memo as contended?
9. Heard the Counsel appearing for the respective parties.
10. It is the submission of the Counsel for the appellant in R.S.A. No. 137 of 2001 that the suit is barred by limitation and the suit is also not maintainable for want of mandatory notice under Section 80 of the CPC It is also submitted that after acquisition of the property there cannot be denotification of the land and moreover, after the properties are acquired under Sections 30 and 11 of the Transfer of Property Act the restrictive covenants is not a valid clause and as such, there is no cause of action for the plaintiff to maintain the suit. The appellants is a bona fide purchaser for value without notice, Further it is his argument that he has paid substantial consideration after allotment and the compromise entered into between the parties is not binding on the defendants and defendants 1 to 3 have every right to alienate the property. Further, the allotment made by the other defendants m favour of this defendant (appellant) cannot be questioned by the plaintiff as the compromise entered into has not been permitted by the Court arid the writ petition was dismissed only on the memo filed by the parties for which the Government is not a party and the said compromise has no legal effect and binding force on the defendants. In support of his argument, learned Counsel has relied on several decisions which I shall refer to in the course of the order.
11. It is the submission of the learned Counsel for the respondents that the terms of the compromise memo filed by the plaintiff and the defendants is binding on the defendants and the question of application of Sections 10 and 11 of the Transfer of Property Act does not apply to the case on hand as it is not a contract and rather it is in the form of acquisition proceedings on behalf of the 2nd defendant and the plaintiff had challenged the acquisition proceedings before this Court in the writ petition. During pendency of the writ petition in W.P. No. 360 of 1969 a compromise was entered into between the parties wherein the Industrial Estate Establishment by its Managing Director and the Administrative Officer, Industrial Estate, Hubli on whose behalf the land was acquired, agreed to reconvey 1.16 acres to the plaintiff out of 2.16 acres by retaining 1.00 acre of land for its administrative building with an understanding that if they do not need the said area of 1.00 acre, the same will be reconveyed to the plaintiff and submitted the said compromise is binding on the defendants. Further, it is submitted that even Ex. P. 1 issued by the Assistant Commissioner, Dharwad refers to the compromise entered into between the parties in the writ petition and he has passed an order to pay an amount of Rs. 2,200/- towards 1.00 acre of land to the plaintiff which indicates that there is an understanding by the Government itself as to the compromise to be acted upon the estoppel operates on defendants 1 to 3 since the land was not utilised for the building of the administrative block. Moreover the land was conveyed by way of lease to the 4th defendant which is indicative of violation of the terms of compromise, and having noticed the same, the lower Appellate Court has rightly decreed the suit for specific performance. It was further contended that though there is no mentioning of the fact as to acceptance of the terms of compromise by the Court in the order passed on the memo filed while dismissing the writ petition, the order passed by the Court bringing the memo on record and thereafter, dismissing the same must be construed as if the Court accepted the memo filed by the parties arid acted upon it and the same amounts to a memoir of the Court which the law deems authentic. In support of his argument he has relied upon several decisions.
12. It is also argued by the learned Counsel for the appellant that since the 3rd defendant is not Government, question of issuance of mandatory notice under Section 80 of the CPC does not arise and accordingly, submitted that there is no merit in that contention. In support of his contention he has relied upon several rulings.
13. It is the argument of the learned Government Pleader that there is no cause of action since the property is very much needed by the defendant 3 for the development of godown and other offices and also submitted that even in the alleged compromise there was no time stipulation as to within which time the construction of the building has to take place. Further, the so-called allotment in favour of 4th defendant is not valid inasmuch as the allotting authority viz., the Additional Director of Industries and Commerce had no authority to allot the suit. lands and the allotment to the 4th defendant has been cancelled. The allotment in favour of 4th defendant was without the knowledge of the compromise entered into between the plaintiff and the 3rd defendant as the files relating to compromise petition had been bunched with the disposed of files. It is further argued that soon after the relevant files were traced, steps were taken to withdraw the allotment on 16-8-1994. The 4th defendant challenged the said withdrawal of allotment in W.P. No. 13966 of 1984 before this Court. The said withdrawal order was quashed reserving liberty to the defendants/appellant to initiate action as per law after affording opportunity to the 4th defendant. It is also submitted that the construction of godowns and administrative block was delayed on account of paucity of funds available for constructing godowns.
14. Further it is submitted that once the property is acquired by the Government, Civil Court has no jurisdiction to entertain the suit in respect of dispute of land arising out of the acquisition proceedings. It is also contended that memo of compromise was filed on behalf of the 3rd defendant for which 1st and 2nd defendant are not signatories and as such, the Government is not a party to the said compromise and the same is not binding on the Government.
15. Let me now consider the substantial questions of law raised together as a matter of convenience.
16. In the decision relied upon by the Counsel for the appellant Bhoop Singh v. Ram Singh Major and Ors. : AIR1996SC196 , the Supreme Court has observed thus:
The Court should therefore examine in each case whether the parties have pre-existing right to the immovable property, or whether under the order or decree of the Court one party having right, title or interest therein agreed or suffered to extinguish the same and created right, title or interest in praesenti in immovable property of the value of Rs. 100/- or upwards in favour of other party for the first time, either by compromise or pretended consent. If latter be the position, the document is compulsorily registrable.
and accordingly contended that based on the alleged compromise Since there is no registration as required under the Registration Act, 1908, the alleged compromise cannot be acted upon as it is related to immovable property the value of which is more than Rs. 100/-.
17. In the decision in Vir Singh and Ors. v. Kharak Singh and Ors. AIR 1925 Lah. 280, it is held thus:
A compromise not assented to by all the parties, is contrary to law and the Court is fully justified in refusing to enforce it.
18. In the decision in the case of Agricultural Produce Market Committee, Yeshwanthpur, Bangalore v. State of Karnataka and Ors. : ILR1997KAR723 , it is held:
Since the Government has no power to take any decision either to cancel the declaration issued under Section 6(1) of the Act, or to withdraw the acquisition as the said declaration is not a proceedings of any subordinate officer of the State Government. Further, under Sub-section (3) of Section 6 of the Act, when once the declaration is issued under Section 6(1) of the Act, it becomes conclusive evidence that the land is needed for a public purpose. This shows that once the land is declared to be required for public purpose by the State Government, the same cannot be interfered with by the State under Section 15-A of the Act.
19. In State of Andhra Pradesh v. Gundugola Venkata Suryanarayana Garu : [1964]4SCR945 , it is held thus:
The object if the notice under Section 80 of the CPC is to give to the Government or the public servant concerned an opportunity to reconsider its or his legal position and if that course is justified to make amends or settle the claim out of Court. The section is imperative and must be strictly construed.
The right to institute a representative action may be exercised by one or more persons having an interest which is common with the others, but it can only be exercised with the permission of the Court. If the Court grants permission to one person to institute such a representative action and if that person had served the notice under Section 80, the circumstance that another person had joined him in serving the notice but did not effectuate that notice by joining in the suit, would not be sufficient ground for regarding the suit as defective.
20. In the case of Bihari Chowdhary and Anr. V. State of Bihar and Ors. : [1984]3SCR309 , it is observed:
A suit against the Government or a public officer, to which the requirement of a prior notice under Section 80 of the CPC is attracted, cannot be validly instituted until the expiration of the period of two months next after the notice in writing has been delivered to the authorities concerned in the manner prescribed for in the section and if filed before the expiry of the said period, the suit has to be dismissed as not maintainable.
21. In the case of State of Kerala and Ors. v. M. Bhaskaran Pillai and Anr. : AIR1997SC2703 , the Apex Court while dealing with Section 16 of the Land Acquisition Act as to the power of the State Government to transfer or assign the surplus portion of the land acquired for public purpose to the original owner from whom the land was acquired has held that such an assignment is impermissible and surplus land must be assigned or transferred only for a public purpose or if not possible, be sold in public auction.
22. Let me now proceed to discuss the substantial questions of law raised
23. The case of the appellant who is 4th defendant in R.S.A. No. 137 of 2001 is that, as per Section 48 of the Land Acquisition Act. there is no denotification of the suit land so as to reconvey the same in favour of the landowner. Of course the plaintiff has filed the suit for re-conveyance of the suit property in his favour and also for possession. It appears, as per the compromise entered into between the plaintiff and the 3rd defendant, though the land to the extent of 2.16 acres was acquired. 1.16 acres was given back in favour of the plaintiff and the remaining 1.00 acre was retained with a stipulation as per the compromise, that the property will be utilised by the 3rd defendant for the purpose of constructing the administrative block. Several contentions were raised by the learned Counsel for the appellant that such compromise is illegal and not binding on the defendants and the defendant 3 has validly allotted the suit properly in his favour and the same cannot be questioned by the plaintiff. It is also his argument that the compromise entered into is not a compromise in the eye of law as the Court did not endorse the said compromise for which all the defendants which is the Government, is not a signatory. It is seen that although Writ Petition No. 366 of 1969 was filed and the decision was taken by the 3rd defendant and thereafter there is a settlement between the plaintiff and the 3rd defendant, whether it was in accordance with the provisions of the Land Acquisition Act or otherwise, such an act was not challenged by the Government which is not a party to the compromise. Thus, as per the settlement arrived at, the plaintiff had the benefit of taking back the possession of land to the extent of 1.16 acres. Whether such a compromise, operates as estoppel on the 3rd defendant or much less on the Government has to be considered.
24. It appears, although the Government was not a party to the compromise, the Assistant Commissioner, Dharwad as per the terms of the compromise in W.P. No. 360 of 1969 which came to be dismissed based on such memo, has ordered for payment of compensation to the extent of 1.00 acre. It appears, such compromise is shown to have been accepted by the Government impliedly when the Assistant Commissioner referring to the compromise, ordered for payment of compensation to the plaintiff insofar as acquisition of 1.00 acre of land is concerned. However, there is also a stipulation as per the compromise, in the event if the land is not utilised for the construction of administrative block, it shall be reconveyed to the plaintiff for the development, of industry as per the policy of the 3rd defendant. It is also the case of the appellant-Basanth Tiles that such a clause in contrary to Sections 10 and 11 of the Transfer of Property Act. The Trial Court was also of the same view. Before considering as to whether such an undertaking in the compromise operates as an estoppel, it is to be noted that in the appeal preferred by the Government and also the 3rd respondent in R.S.A. No. 215 of 2001, there is no time stipulation to put up the administrative block as per the terms of the compromise. further, due to lack of funds they could not put up the building. It is also their case that since the file regarding compromise in the writ petition was misplaced after the transfer of the officers concerned, some other officer who was also not aware of the terms of the compromise and who also was not empowered to allot the land in favour of the 4th defendant had allotted the land, such allotment in favour of 4th defendant has been revoked. Further, it is noticed that the 4th defendant is shown to have moved this Court in a writ proceeding challenging such revocation of allotment. It appears this Court has allowed the writ petition and remanded the matter back to the authority to take action in accordance with law. Further, it appears that steps have also been taken by the 3rd defendant for the revocation of the allotment made and in the meanwhile, the appellant in R.S.A. No. 137 of 2001 is shown to have moved an application for injunction apart from challenging the revocation of the allotment. By way of an affidavit, the appellant-Government in R.S.A. No. 215 of 2001 has stated that the land is still needed for the purpose for which the land was acquired. Admittedly, the requirement of the Government-3rd defendant very much subsists and it is their case that by inadvertence such an allotment was made to the 4th defendant and that they have taken steps to revoke the allotment and tried to act upon the terms of the compromise. It appears the lower Appellate Court has committed an error in granting a decree of reconveyance although there was no cause of action for the plaintiff to move the Civil Court seeking for an order of reconveyance. Might be that allotment was made by the 3rd defendant in favour of the 4th defendant out of ignorance at the relevant point of time and without authority of law by the concerned officer. When it is the stand of the Government that such an allotment is not in accordance with law and they have taken steps to revoke the allotment, there is no cause of action to the plaintiff. Moreover, the question of reconveyance does not arise in favour of the plaintiff in the circumstance of the case and whether an order under Section 48 of the Land Acquisition Act, 1894 is required or not, does not arise to pass an order of reconveyance. Accordingly, the 1st substantial question of law has to be held in favour of the appellant-Government in R.S.A. No. 215 of 2001 while negating the contention of the plaintiff as well as the contention of the 4th defendant who is the appellant in R.S.A. No. 137 of 2001.
25. The 2nd substantial question of law that is raised is as to the contention of the 4th defendant that he is a bona fide purchaser and as such, plaintiff is not entitled to reconveyance and is only entitled for damages. While answering the 1st substantial question of law, it is noted that there is no cause of action to the plaintiff to file a suit for reconveyance when admittedly the Government has taken steps to revoke the allotment made in favour of the 4th defendant. Although the 1st and 2nd defendants were not parties to the compromise, impliedly such a compromise has been approved by the Government and also tried to act upon it. Further, it is seen the very purpose for which the land was acquired and possession was taken over by the 3rd defendant-Corporation still subsists and it is also their case that the land is needed for development of godown and other buildings and that by inadvertence such an allotment was made by an officer who had no power to allot in favour of the 4th defendant, the 4th defendant cannot contend that he is a bona fide purchaser and is entitled for possession and also to contend that plaintiff is only entitled for damages. Neither the plaintiff is entitled to reconveyance nor the 4th defendant is entitled to retain possession of the suit property having regard to the stand of the Government and also the circumstances under which the alleged allotment is said to have been made in favour of the 4th defendant.
26. The next substantial question of law framed is as to whether the suit was barred by limitation. The Trial Court has noticed that as per the compromise memo in W.P. No. 366 of 1969 filed on behalf of the plaintiff and 3rd defendant, one of the condition was that if the defendants do not need the suit property for their proposed administrative building, they will reconvey the property in favour of the plaintiff. However, it is noticed that till 1984 from the year 1969, administrative building was not put up. On coming to know of this fact, plaintiff has issued a notice to the 2nd defendant to comply with the terms of the compromise and to execute the reconveyance deed. The said notice is dated 31-10-1978-Ex. P. 5. Ex. P. 9 is the reply. The Trial Court has opined that the cause of action arose to the plaintiff as per Ex. P. 5, on 31-10-1978 when the defendant has not utilised the suit property for the purpose of constructing administrative building and allotted the same in favour of the 4th defendant and, the plaintiff ought to have filed the suit within three years from the date the cause of action arose seeking for specific performance by way of reconveyance. 31-10-1978 was the date on which the plaintiff had issued notice to the 2nd defendant and 2nd defendant denied the contents of the notice by a reply dated 12-3-1979. Stating that the plaintiff ought to have filed the suit within three years from the date of reply as per Ex. P. 9, the Trial Court has held that the suit is barred by limitation.
27. It appears that as per the finding of the lower Appellate Court on this aspect, the suit is not barred by limitation as there was no question of filing the suit in view of the defendants stating that they still need the suit property for the construction of administrative building. It has also observed that the Trial Court having wrongly assumed that 12-3-1979 is the dale of reply of the defendants as per Ex. P. 9, as the starting point of limitation, has held that the suit is barred by limitation since the suit was filed in the year 1984.
28. The lower Appellate Court has rightly noticed that there cannot be a refusal or notice of refusal to perform the contract as per the terms of the compromise since time was set up to put up the construction of the administrative building and rather, it has held that the real starting point of limitation in that date of breach by defendants 1 and 3 when they allotted the suit property in favour of 4th defendant as per Ex. D. 1, on 30-5-1984. The lower Appellate Court has rightly held that the suit is filed within the period of limitation. The substantial question of law raised has to be held in favour of the respondent.
29. The other substantial question of law raised is whether there is mandatory compliance of Section 80 of the CPC prior to institution of suit This question in fact, has not been considered by either of the Courts below, For the first time, this question has been raised by the appellant hi R.S.A. No 137 of 2001. It is the argument of the learned Counsel for the appellant that since the Government is a party to the proceedings, as per the mandate of Section 80 of the CPC, the plaintiff ought, to have issued mandatory notice to defendants 1 to 3. Learned Counsel has relied on several decisions to stand by his contention. In the case of Bihari Chowdhary, referring to Section 80 of the CPC, the Apex Court has held that 'there is clearly a public purpose underlying the mandatory provision contained in the section insisting on the issuance of notice setting out the particulars of the proposed suit and giving two months' time to the Government or a public officer before a suit can be instituted against them. The object of the section is the advancement of justice and securing of public good by avoidance of unnecessary litigation'.
30. The ratio laid down in the decisions relied upon by the learned Counsel is that the suits to which Section 80 of the CPC applies, compliance of it is mandatory and the suit which does not satisfy it is Liable. to be dismissed.
31 Referring to the decision in Sawai Singhai Nirmal Chand v. Union of India : [1966]1SCR988 , the Division Bench of the Patna High Court in the case of State of Bihar and Anr. v. Smt. Panchratna Devi and Anr. : AIR1980Pat212 , has held thus: 'The issue was either not raised at the trial stage and/or did not appear to have been pressed. This conduct on the part of the defendants would amount to waiver of right of notice under Section 80 of the CPC.... There is no inconsistency in the proposition that the provision under Section 80 is mandatory but the right may be waived by the party for whose benefit it has been provided'. The above ratio negates the case of the appellant to contend that there was no mandatory notice as per Section 80 of the CPC. Further, it appears the same was not seriously contested by the appellants at the appropriate stage and moreover, there was a notice as early as in the year 1978 calling upon the defendants to convey the property as per the terms of compromise. Hence, this substantial question of law raised has to be held in favour of the plaintiff more so, in view of the fact that the defendant has not insisted nor raised any objection at the stage of trial or at the stage of appeal.
32. Although it is the contention of the appellant in K.S.A, No. 137 of 2001, objection could be raised under Section 80 of the CPC can be raised in second appeal, the conduct of the defendants throughout shows that they have not seriously objected and contested the suit on that point. Under such circumstances when a contention is raised for the first time that the suit is bad for want of notice under Section 80 of the CPC at this belated stage, it cannot be accepted. Accordingly, the substantial question of law is answered in favour of the respondent.
33. Insofar as the question of law rained - whether the compromise memo alleged to have been filed in W.P. No. 366 of 1969 is not binding on the appellant-Government since it has not signed the compromise memo is concerned, learned Counsel for the respondent, referring to the dismissal of the writ petition on the strength of the compromise memo which is signed by 3rd defendant and the plaintiff, has contended that the 2nd defendant has accepted and indirectly while accepting such a compromise, acted upon the terms of the compromise in paying the compensation to the plaintiff, which is part of record, and, as per the definition of 'record of Court' in the Law Lexicon, a record is a memorial of a Court of justice which the law deems authentic above all contradiction. Here it is seen that the memo said to have been signed by the plaintiff and 3rd defendant was filed in W.P. No. 366 of 1969 before the Division Bench of this Court wherein the Division Bench though has not expressed anything as to permitting the parties to enter into compromise and the Government has not signed such a compromise, the terms of the memo have been complied with by the parties to the writ petition wherein 1.16 acres of land was conveyed to the plaintiff and remaining 1.00 acre was retained by the 3rd defendant and also on behalf of the Government for the purpose of construction of administrative block.
34. In this context it is to be noted that as per the terms of the compromise, the property of l. 00 acre was retained by the 3rd defendant for the purpose of construction of administrative block and as per the affidavit filed, even now the property is required by them for the purpose of extension of administrative block and godowns and other ancillary purposes. It is to be noted that although it is the contention of the Counsel for the respondent that during pendency of the matter, the 3rd defendant has put up the administrative block in some other property, it appears the property is still needed for the extension of the administrative block as well as for establishment of godown and for other purposes. In this regard, it is relevant to note the ratio laid down in the case of C. Padma and Ors. v. Deputy Secretary to Government of Tamil Nadu and Ors. : (1997)2SCC627 , wherein referring to Section 4 of the Land Acquisition Act, it is observed the land acquired has been vested in the State Government and on payment of the compensation to the claimant, the claimants are not entitled to restitution on the ground that either the original public purpose had ceased to be in operation or the land could not be used for any other purpose. The above ratio clearly depicts that when the land is needed for other purposes, the respondent cannot contend that the land is no longer required for the 3rd defendant for the purpose stated by them.
35. In the case of Larsen and Toubro Limited v. State of Gujarat and Ors. : [1998]2SCR339 , referring to Sections 48 and 41 of the Land Acquisition Act, 1894, the Apex Court has held that an owner need not be given notice of the intention of the State Government to withdraw from the acquisition and the State Government is at liberty to do so. The rights of the owner are well-protected by Sub-section (2) of Section 48 of the Act and if he suffered any damage in consequence of the acquisition proceedings, he is to be compensated and Sub-section (3) of Section 48 provides as to how such compensation is to be determined. However, in the case of a company, opportunity has to be given to it to show cause against any order which the State Government propose to make withdrawing from the acquisition..... A valuable right, thus, accrues to the company to oppose the proposed decision of the State Government withdrawing from acquisition.... It is therefore, implicit that the withdrawal from the acquisition has to be notified. The above ratio clearly depicts there can be a withdrawal of the acquisition in favour of the landowner but, however, a notice needs to be given to the concerned or beneficiary on whose behalf the land is acquired and if any loss is suffered after notification under Sections 4 and 6 and if any development is made and damage is suffered in consequence of the withdrawal of acquisition, the company would be entitled to damages.
36. In the instant case, as noted, in the writ proceedings the 3rd defendant the Small Scale Industrial Corporation on whose behalf the land was acquired, entered into a compromise with the respondent in W.P. No. 366 of 1969 wherein the suit property was agreed to be returned back to the landowner if it is not required for its own purpose and such a return of property, not by way of withdrawal of the acquisition proceedings, rather it appears to be for the development of the industry as per the scheme of the 3rd defendant-Corporation and appears to be having nexus to the object which the 3rd defendant's ought to achieve though not by the 3rd defendant itself but by the 3rd respondent-landowner for the very same purpose of establishing a industry. In such circumstances, the contention that there is no notification as per Section 48 of the Land Acquisition Act does not hold any water.
37. In the affidavit filed by the Government Pleader on behalf of the Government by the concerned Department, it is seen that the suit property is still required for the purpose of godown and other purposes in addition to the expansion of administrative block. Although it is the case of the Counsel for the respondent that a building was put up as an administrative block and in support of the same, tried to produce some photographs, no supporting material is placed and moreover, when expansion is requited to be made by the 3rd defendant and the land was needed for its own purposes, and when no time-limit has been fixed for putting up the administrative block or any other building for its administrative purposes, necessarily, there is no cause of action to the plaintiff. Further, it is seen that the terms of the compromise entered into between the 2nd defendant and plaintiff in the writ proceedings is not in the form of a contract to say that the same is hit by the Sections 10 and 11 of the Transfer of Property Act, In the acquisition proceedings by the Government on behalf of the 3rd defendant, land is said to have been purchased by the plaintiff from the 1st petitioner in W.P. No. 366 of 1969 after the initiation of the acquisition proceedings and it appears that the 3rd defendant on whose behalf the land was acquired has acted as per the terms of the compromise towards the earlier portion of the compromise in reconveying the property to the extent of 1.16 acres reconveyed way back in the year 1969. Insofar as 1.00 acre of land which was agreed to be conveyed was not only for any other purpose but, for the purpose of establishing the industry as per the norms of 3rd defendant which was also constituted to promote the purpose of small scale industries. In that view of the matter, it cannot be said that compromise entered into between the parties is not binding on the appellant-Government. However, in the instant case, the need of the 3rd defendant apparently is shown to be still surviving, and it is also the case of the 3rd defendant that without noticing the compromise the officer concerned who had no authority, by inadvertence had allotted the suit property in favour of the 4th defendant and steps have been taken by 3rd defendant as per the terms of the compromise, to withdraw the allotment and to make use of the suit property for its own purpose. Such being the case, there is no cause of action to the plaintiff. Moreover, it appears when steps have been taken by 3rd defendant to take back possession of the suit property after cancellation of allotment, 4th defendant is shown to have moved this Court in writ petition and also obtained an order in his favour. However, it is seen that the matter was remanded back by this Court to the 3rd defendant, to act in accordance with law. As per the terms of compromise and also as the suit property is required by the 3rd defendant, 3rd defendant was right in initiating proceedings against the 4th defendant by canceling the allotment and attempted to take back the suit property for its development. There shall not be any other impediment for the 3rd defendant to take back the suit property for its development purposes as contended. Further, though the contention of the 4th defendant is that he is a bona. fide. purchase for value without notice and also made certain improvements, as per the terms of compromise, it is binding on the parties and also when it is the case of the 3rd defendant that the property was allotted to 4th defendant by inadvertence by the officer who had no power, such an allotment would be non est in the eye of law. Furthermore, if possession is taken by the 4th defendant and if he has made some improvement, it is for him to return back the suit property and of course he would be entitled to recover the damages which he is said to have reasonably spent for bringing in development.
38. It appears, the plaintiff had filed a suit immediately after coming to know of such illegal allotment in favour of 4th defendant. As such, the improvements made if any, by the 4th defendant would be not as contended by him but would be nominal. Furthermore, after filing of the suit if any such improvements have been made during the Us pendens, it would be at the risk of 4th defendant for which he is not entitled for any damages or compensation.
39. For the foregoing reasons, the appeal filed by the 4th defendant in R.S.A. No. 137 of 2001 is dismissed. Appeal filed by the Government in R.S.A. No. 215 of 2001 is allowed. The Government is entitled to take back possession of the suit land from the 4th defendant as observed above and shall take steps in that regard. Parties to bear their own costs.