The Shantiniketan Co-operative Housing Society, Ltd. Vs. Madhavlal Amirchand - Court Judgment

Barlee, J.

1. The appellants are the Shantiniketan Co-operative Housing Society, Ltd., and Ramanlal Govindlal Shah. The respondents are the heirs of Patel Amichand Kuberdas and the Secretary of State for India in Council. The facts to which I shall have to refer in connection with the main issue in the suit are few and undisputed.

2. The appellants are a co-operative society registered under Bombay Act VIII of 1925. The first appellant is the co-operative society and the second appellant is one of its members. In 1925 by the said Act the Bombay legislature made a provision for co-operative housing societies, and in 1927 the Government decided to acquire land in Ahmedabad for the Shantiniketan Housing Society, and a Notification under Section 4 of the Land Acquisition Act was promulgated. Part of the land which it was proposed to acquire belonged to Patel Amichand Kuberdas, and he objected to the acquisition of his land on the ground inter alia that the acquisition was illegal. His objection was overruled and a Notification was issued under Section 6 of the Act. Section 6-provides-

When the Local Government is satisfied that any particular land is needed for a public purpose, or for a Company, a declaration shall be made to that effect...' and Sub-section (3)-The said declaration shall be conclusive evidence that the land is needed for a public purpose or for a Company.

After issuing a valid notification the local Government has jurisdiction to direct the Collector to take order for the acquisition of the land. In consequence of this notification the acquiring officer commenced proceedings to determine the amount of compensation to be given and an award was made. The respondent took the money allotted to him under protest, and he made an appeal to the District Court, or rather he asked the acquiring officer to refer the matter of compensation to the District Court under the Land Acquisition Act. At that stage he took no other steps, and the reason was that a suit had already been decided in which the legality of acquisition for housing societies had been in issue and an appeal was pending in this Court. The respondent waited to see the result of the appeal. In 1930 it was decided by a bench of this Court that a co-operative society registered under Bombay Act VIII of 1925 was not: a society registered within the meaning of the Co-operative Societies Act of 1912 and was not a company within the meaning of Section 3(e) of the Land Acquisition Act, and that Government were not entitled to acquire land for such a society. After that decision the respondent, Patel Amichand Kuberdas, filed Regular Suit No. 1000 of 1930 in the Joint First Class Subordinate Judge's Court at Ahmedabad. He prayed for a decree directing such of the defendants, ((1) The Secretary of State for India, (2) The Shantiniketan Co-operative Housing Society, or (3) Ramanlal Govindlal Shah,) as might be found to be in actual possession of S. No. 50|2 of Moje Kochrap to remove any buildings, structures or other deposits made on the said land, to restore it to its original condition and to hand over the same to him, the plaintiff, as against the refund of Rs. 3,891 or such other sum as might be found to be refundable to the defendants or any of them, and, secondly, a decree for damages and costs.

3. The principal questions which were at issue in the trial Court were, (1) whether or not defendant No. 2 was a ' company ' within the meaning of Section 3 (e) of the Land Acquisition Act, (2) whether the suit was barred by acquiescence, estoppel, waiver and laches, (3) whether it was open to the plaintiff to challenge the decision of Government by contending that the acquisition was not for a 'public purpose', and (4) whether pecuniary compensation would not give adequate relief to the plaintiff in the circumstances of the case. The learned Subordinate Judge, following the abovementioned decision of this Court in Sheth Chinubhai Lalbhai v. Secretary of State for India (1930) F.A. No. 272 of 1929, held that the acquisition was not for a 'company'. He also held that it was not for a ' public purpose' and that the defendants were not entitled to relief on the ground of acquiescence or estoppel. However, for on July 7, 1930 (Unrep.). decided by Madgavkar and Barlee JJ., reasons-which are not very plain-he gave the defendants an option of paying compensation instead of giving up the land, and decided that the amount of compensation proper was Rs. 9,377.

4. This appeal has been filed by the society and by Ramanlal. The Secretary of State is shown as respondent No. 2. The rights of the parties depend on the validity of the acquisition proceedings. We agree that the defendants are not entitled to resist eviction on the ground of estoppel or acquiescence. The plaintiff Amichand protested against the intended acquisition ; and, after he was evicted, he took part in the acquisition proceedings under protest. It is true that after the land had been taken from him and was lying idle, before Ramanlal, the second appellant, commenced to build, he, or his son for him, re-entered as tenant. But when Ramanlal commenced to build he made a final protest by means of a written notice He did not file a plaint at once because he wisely waited for the decision of this Court in the previous litigation. But we think that this delay does not afford ground for defendant No. 2, who started building operations in spite of the plaintiff's warning, to complain that he is entitled to any relief on the ground of acquiescence or estoppel.

5. The main ground on which the learned Subordinate Judge has decided this case is that the acquisition proceedings were illegal, since in his opinion the society was not a ' company ' within the meaning of the Land Acquisition Act. A 'company' is denned in Section 3 (e) of that Act-

the expression Company means a company registered under the Indian Companies Act, 1882, ... and includes a Society registered under the Societies Registration Act, 1860, and a registered Society within the meaning of the Co-operative Societies Act, 1912.

The learned Subordinate Judge has, as I have said, followed the decision of this Court that this society was not one within the meaning of the Co-operative Societies Act, 1912, and I need not go into this point. He also held that the acquisition was not for a public purpose. It seems to us that in this he was going outside the case because Section 6 of the Act provides that the Government must make a declaration that the land is required for a public purpose, or for a company, and in this case there was no such declaration. The wording of the declaration was merely that the land was required for the Shantiniketan Housing Society, and that cannot be understood to mean that it was for a public purpose. The learned Subordinate Judge, therefore, had only to see whether the Housing Society was a ' company' and nothing more.

6. It is not now argued that the learned Subordinate Judge's decision on this point was incorrect at the time at which it was made. The case for the appellants is that by virtue of the addition of Section 72A to the Bombay Cooperative Societies Act, 1925, it must now be held that the appellant society-is a ' company ' within the meaning of the Land Acquisition Act, that Section 72A must have retrospective effect, and, therefore, that it must be held that the appellant society was a ' company ' within the meaning of the Land Acquisition Act at the date of the acquisition proceedings. Section 72A which was added to the Bombay Co-operative Societies Act, 1925, by Bombay Act VIII of 1933, runs as follows :-

All 'references to the Co-operative Societies Act, 1912, occurring in any enactment made lay any authority in British India and for the time being in force in the Presidency of Bombay shall, in the application to the said Presidency, of any such enactment, be read and construed as references to this Act and anything done or any proceeding commenced in pursuance of any such enactment on or after the date on which this Act shall have come into operation shall be deemed to have been done or to have been commenced and to have had effect as if the reference in such enactment to the Co-operative Societies Act, 1912, had been the reference to this Act, and no such thing or proceeding shall be deemed to have been invalid on the ground that such enactment did not refer to this Act.

Put shortly, this means that the reference to the Co-operative Societies Act, 1912, in Section 3 (e) of the Land Acquisition Act shall be read as a reference to the Bombay Co-operative Societies Act, 1925, and that in consequence a society registered within the meaning of the Bombay Co-operative Societies Act, 1925, is a ' company ' within the meaning of the Land Acquisition Act. In consequence, it is now permissible and legal for the local Government to acquire lands compulsorily for the benefit of the appellant society.

7. The bone of contention in the present appeal is whether this section is retrospective in effect and legalizes the acquisition proceedings of 1927. The principle which we have to apply is stated by Maxwell, at p. 186 of the 7th Edition, in the following words :-

Upon the presumption that the Legislature does not intend what is unjust rests the leaning against giving certain statutes a retrospective operation.. .They are construed as operating only in cases or on facts which come into existence after the statutes were passed unless a retrospective effect be clearly intended. It is a fundamental rule of English law that no statute shall be construed to have a retrospective operation unless such a construction appears very clearly in the terms of the Act, or arises by necessary and distinct implication.

No rule of construction is more firmly established than this : that a retrospective operation is not to be given to a statute so as to impair an existing right or obligation, otherwise than as regards matter of procedure, unless that effect cannot be avoided without doing violence to the language of the enactment.

8. This is the sale which has always been followed in Courts in India. We have been referred to a number of cases on the point. In Kanakayya v. Janardhana Padhi I.L.R. (1910) Mad. 439, it was held as follows :-

Where an appeal from a decree in ejectment passed under the old law is heard after the commencement of Madras Act I of 1908 (Estates Land Act) the defendant being a ryot in possession of ryot land on such date, he is entitled to claim a right of occupancy under section 6, clause 1 of the Act notwithstanding the original decree.

That was a case in which the Court gave retrospective effect to an enactment of the local legislature. In the order of reference to the full bench their Lordships quoted a passage from the judgment of Bowen L. J. in Quilter v. Mapleson (1882) 9 Q.B.D. 672, viz. (p. 677) :--

No doubt, as a general rule, a statute does not affect pending proceedings, but that rule is only a guide where the intention of the legislature is obscure, it does not modify the clear words of a statute.

9. In Doolubdass Pettamberdass v. Ramloll Thackoorseydass (1850) 5 M.I.A. 109, their Lordships remark (p. 126) :--

Their Lordships are of opinion, that this Legislative Act is not to be construed as affecting existing contracts; at all events, not those contracts on which actions have already been commenced, for Statutes are prima facie deemed to be prospective only,... and there are no words in this Act sufficient to show the intention of the Legislature to affect existing rights.

10. In Delhi Cotton Co. v. Income-tax Commissioner (1927) 30 Bom. L.R. 60., Lord Blanesburgh, in delivering the judgment of the Privy Council, stated (p. 63):-

The principle which their Lordships must apply in dealing with this matter has been authoritatively enunciated by the Board in Colonial Sugar Refining Company v. Irving, where it is in effect laid down that, while provisions of a statute dealing merely with matters of procedure may properly, unless that construction be textually inadmissible, have retrospective effect attributed to them, provisions which touch ..a right in existence at the passing of the statute are not to be applied retrospectively in the absence of express enactment or necessary intendment.

We do not think it necessary to cite any further cases to illustrate the principle that Courts are bound to give effect to the intention of the legislature and are bound therefore by the express words of the legislature, when those words can have but one meaning. Where, however, it is possible to construe the words of the legislature in more than one way, the Courts will always lean against an interpretation which will give retrospective effect to the terms of an enactment.

11. Our duty then is to interpret the words of the enactment in Bombay Act VIII of 1933 and to see whether we are bound to give it retrospective effect. To this question there can be but one answer. The legislature says that all references to the Co-operative Societies Act, 1912, shall be read as references to this Act, viz., Bombay; Act VIII of 1925, and anything done or any proceeding commenced in pursuance of any such enactment on or after the date oh which this Act, i.e., Bombay Act VIII of 1925, shall have come into operation shall be deemed, etc. Clearly this is an Act of indemnity to validate actions and proceedings prior to the date of the Act of 1933, i.e., all Acts or proceedings on or after 1925. We do not think that the legislature could have put their intention in clearer words.

12. Mr. Coyajee, who has argued the case for the respondents, has conceded that this Act of 1933 must be given retrospective effect, but he would restrict it to actions and proceedings on or after 1925 which had not led to judicial proceedings. Where, as in this case, there has been not only a suit but a decree before the date of the amending Act the learned counsel asks us to hold that it cannot be presumed to be the intention of the legislature to interfere with the rights of the parties. The argument comes to this that we are to look upon the decree of the lower Court as binding inasmuch as it was passed in 1932 before the date of the amending Act. But appellate Courts do and are entitled to take into account changes of circumstances which occur between the date of the decree of the lower Court and the date of the hearing of the appeal. Authority for this is to be found in the case of Kanakayya v. Jmardhana Padhi, which I have already cited. There an appeal was preferred from a decree in ejectment, and after the hearing of the suit and before the hearing of the appeal an Act was passed which gave the appellant an occupancy right and-deprived the respondent, the landlord, of his vested interest under the decree. In the case of Motilal v. Kasambhai : AIR1928Bom16 which was decided in 1927, from an appeal made in 1924, His Lordship Sir Amberson Marten, Chief Justice, based his finding on a legislation of 1926 and 1927. The head-note runs :-

The amendment made by Act XXVII of 1926 in the definition of the word 'attest' in section 3 of the Transfer of Property Act, 1882, has been given a retrospective effect by Act X of 1927.

13. In Yakubkhm v. Guljarkhan (1927) 30 Bom. L.R. 565, which was an appeal decided in 1927 from, a decision of 1925, the decision was based by Madgavkar J. on Act XXXI of 1996. It is clear then that, if necessary, a Court of appeal will give retrospective effect to legislation even if by so doing they are obliged to interfere with the rights given to parties by decrees. I do not think it necessary to. refer to any more of the cases which the learned counsel have cited to us. The principle is quite clear and each decision depends on its own facts and we have to decide what is the effect of the Act of 1933. As I have said, this is a validating Act which is necessarily retrospective in its operation, and the only question before us is whether we can read into it any exceptions as required by Mr. Coyajee. We are not prepared to do so.

14. We hold that the appellant society is and was at the date of the acquisition proceedings a ' company' within the meaning of the Land Acquisition:. Act, and that therefore it was competent for the local Government to acquire land on its behalf and the acquisition proceedings were regular, and that the land therefore vested in the local Government.

15. The appeal, therefore, must succeed, and it is not necessary for me to deal, at length with the other findings of the lower Court We are of opinion that the finding of the learned Judge on the question whether the land was acquired for a ' public purpose' was irrelevant. It was for the Government to declare whether it was for a ' public purpose ' and they had not done so. Secondly,, the learned Subordinate Judge was in error in refusing to give possession after he had found that the title still vested in the plaintiff and therefore all', the evidence and the findings as to the value of the land are irrelevant. It will be for the District Court to value the land and to give compensation to the later owner, the respondent, in the acquisition proceedings.

16. The appeal, therefore, succeeds. In view of the peculiar circumstances of this case we feel that each party should bear his own costs throughout. The' amount deposited by Mr. Thakor's client to be returned.

17. Cross-objections dismissed. No order a$ to costs.

Sen, J.

18. The principal question in this appeal is whether the acquisition was for a 'public purpose', or for a 'company' as defined in the Land! Acquisition Act. The fact to notice in this connection is that there is no declaration in the notification under Section 6 of the Land Acquisition Act that the acquisition was for a 'public purpose'. Reading the sections subsequent to-s. 6, it seems to us that only a declaration to the effect that the land acquisition was needed for a 'public purpose' would give jurisdiction to the Land Acquisition Officer to take further steps as provided in the Act, and' that there being no such express declaration, the acquisition proceedings cannot be regarded as valid for such purpose, even though the purpose might have been in fact a 'public purpose'.

19. The learned advocate for the appellant, however, contends that if the acquisition was not for a ' public purpose,' it was certainly for a 'company' as defined in the Act, and he bases his contention on the argument that Section 72A of the Bombay Co-operative Societies Act, 1925, which was incorporated in the Act by an amending Act of 1933, has and is meant to have retrospective effect, and that this retrospective effect of the new section is so clear and unquestionable that there can be no scope for any argument based on ambiguity or on questions affecting the vested interests of any party. There is no doubt that if the new section can be interpreted in one way only, viz., that it has retrospective effect, the legislation must be given effect to, however hard the result may be.

20. It was held in a previous case in this Court that registration under the Bombay Co-operative Societies Act, 1925, does not bring a co-operative society within the definition of a ' company ' in Section 3 of the Land Acquisition Act, as that definition merely includes a society registered under the Societies Registration Act, 1860, and a registered society within the meaning of the Co-operative Societies Act, 1912. Section 73 of the Bombay Co-operative Societies Act, 1925, repeals the Co-operative Societies Act, 1912, and it was held that the registration under the Bombay Act of 1925 should not be construed as one under the India Act of 1912, so that the reference to the India Act of 1912 in the definition of ' company' should not be taken to be one to the Bombay Act of 1925. As this result had apparently not been intended by Government, they inserted the validating Section 72A by which anything done or any proceeding commenced in pursuance of any enactment (containing a reference to the Act of 1912) in force in the Presidency of Bombay on or after the date on which the Bombay Act of 1925 came into operation was to be deemed to have been done, or to have been commenced and to have had effect as if the reference, e.g., in the Land Acquisition Act, to the India Co-operative Societies Act, 1912, had been a reference to the Bombay Cooperative Societies Act, 1925. There does not seem to be any room for ambiguity or doubt in the wording of the section, the intention of the legislature in enacting this new section being most clearly and unequivocally expressed. This being so, we must hold that this new section has retrospective effect, and the society is a 'company' as denned in Section 3(e) of the Land Acquisition Act.

21. Mr. Thakor's next contention is that if that be so, the Court would be justified in taking this new section into consideration and giving effect to it, though the section was not in existence when the suit was decided by the First Class Subordinate Judge of Ahmedabad ; and in support of this proposition Mr. Thakor has drawn our attention to the following rulings :-Kanakayya v. Janardhana Padhi (I.L.R. 1910) Mad. 439, Muthuswami Ayyar v. Kalyani Ammal I.L.R. (1916) Mad. 818 Sakharam Mahadev Dange v. Hari Krishna Dange I.L.R. (1881) 6 Bom113, Rustomji v. Sheth Purshottamdas I.L.R. (1901) 25 Bom. 606 : S.C. 3 Bom. L.R. 227 Shankarbhai v. Motital : AIR1925Bom122 , Motilal v. Kasambhai : AIR1928Bom16 , Yakubkhan v. Guljarkhan (1927) 30 Bom. L.R. 565, Pmdharmath v. Thakoiedas (1928) 31 Bom. L.R. 484 Amritlal v. Kantilal (1930) 33 Bom. L.R. 266 Secretary of State v. Bombay Municipality (No. 1) : (1935)37BOMLR499 , and Nun Mim v. Ambica Singh I.L.R. (1916) Cal. 47; Mr. Coyajee, however, though admitting that the new provision of law clearly provides for retrospective effect, contended that there is an exception to this general rule, viz., in cases in which civil actions have already arisen, and have other been finally decided, or are still pending at the date of the new provision; and in support of this argument he has invited our attention to Ktmakkmti Ray v. Knpanath Gain I.L.R. (1930) Cal. 817, Doolubdass Pettamberdass v. Ramloll Thakoorseydass (1850) 5 M.I.A. 109 Delhi Cotton Co. v. Income-tax Commissioner (1927) 30 Bom. L.R. 60 Youngy. Adams [1898] A.C. 469, Sundrabai v. Manohar (1932) 35 Bom. L.R. 404, Mian Pir Bux v. Mahomed Tahar : (1934)36BOMLR1195 . and Colonial Sugar Refining Company v. Irving [1905] A.C. 369.'

22. On going through this latter set of cases, it seems to us that in all of them, except the Calcutta case, the new law which had come into operation and the effect of which was considered had not expressly provided for retrospective effect, and in our opinion these cases do not go beyond the principle that a' new law which is not clearly retrospective, either by express language or necessary implication, should have no effect on suits pending or already decided. As regards the Calcutta case, Kanakkanti Ray v. Kripanath Gain, its ratio decidendi seems to be inconsistent with that of two previous cases decided by the Calcutta High Court, viz., Maniruddm Mandal v. Sreemati Charu Sila Dassi (1928) CRI.L.J. 386 and Tupsee Singh v. Ram Sarun Koer I.L.R. (1888) Cal. 376, and we find ourselves unable to agree with the line of reasoning adopted in this case. This decision is contrary to the effect of all the cases on which Mr. Thakor has relied, which is briefly this, that the Court of appeal is not merely a Court of error, and that when a change of circumstances or of law has taken place between the date of the decree of the lower Court and the hearing of the appeal, the appellate Court is entitled to take such change into consideration and pass orders accordingly. We agree with Mr. Thakor's contention in this respect and hold that this Court is competent to take into consideration the effect of Section 72A of the Bombay Co-operative Societies Act, and that we would be justified in the circumstances of this case in taking it into consideration. There is no doubt that an appeal is a continuation of the suit and that in the present case there has been no final decree.

23. In the result, therefore, we hold that the Co-operative Society in this case is a ' company ' coming within the definition of the said word in Section 3 of the Land Acquisition Act. The declaration in Section 6 of the Land Acquisition Act, however, does not speak specifically of a ' company.' It says that whereas by a previous notification it was notified that the lands specified in the schedule to the notification were needed under the Land Acquisition Act for the purpose stated in the said notification, viz., for erecting houses to be acquired at the expense of the Shantiniketan Housing Society, Ltd., Ahmedabad... it is also hereby finally declared under the provisions of Section 6 of the said Act that the said lands are required for the purpose stated above. The notification, however, makes it clear that the acquisition was necessary for the purposes of the appellant society. As, however, we have held that this society came within the definition of a ' company' in the Land Acquisition Act and as the definition itself expressly mentions that the company includes a society registered within the meaning of the Co-operative Societies Act, 1912, we are of opinion that the declaration, though it did not expressly say that the acquisition was for a 'company', sufficiently complied with the requirements of Section 6, and that being so, we hold that the subsequent proceedings held under the succeeding sections of the Land Acquisition Act were held with proper jurisdiction and were, therefore, valid.

24. I do not wish to add anything on the other points arising in this case, and I agree to the order proposed by my learned brother.