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Thursday, March 31, 2016

Constitutional validity of the Land Acquisition (Goa Amendment) Act, 2009 - promulgation of the Land Acquisition (Goa Amendment) Ordinance, 2009 we find that the argument made on behalf of the petitioners that the Goa State Amendment was intended to benefit a singular entity i.e. the third respondent is without any basis whatsoever. The aforesaid Cabinet decision clearly indicates that the exercise undertaken was more broad based than what the petitioners would like us to hold. In fact, there is a detailed reference, by names, in the said Cabinet decision to several other groups and corporations who are similarly situated as the third respondent.Similarly, the plea of violation of the principles of Rule of Law and judicial review, urged on behalf of the petitioners, would not merit any serious consideration as the provisions of Sections 41(6) to (9), introduced by the State Amendment insofar as Court decrees/orders is concerned, are incidental and consequential provisions to an Amendment Act validating actions that had earlier received judicial disapproval.

                                 REPORTABLE

                        IN THE SUPREME COURT OF INDIA
                         CIVIL ORIGINAL JURISDICTION
                    WRIT PETITION (CIVIL) NO. 131 OF 2009

GOA FOUNDATION & ANR.                 ...PETITIONER (S)
                                   VERSUS
STATE OF GOA & ANR.                      ...RESPONDENT (S)

                                    WITH

                    CONTEMPT PETITION (C) NO. 292 of 2009

                                     IN

                        CIVIL APPEAL NO.4154 of 2000



                               J U D G M E N T

RANJAN GOGOI, J.

1.     The  challenge  in  this  writ  petition  under  Article  32  of  the
Constitution of India is to Constitutional validity of the Land  Acquisition
(Goa Amendment) Act, 2009  (Goa Act 7 of 2009) which was promulgated by  the
Governor of Goa on 11.04.2009  and  notified  in  the  Official  Gazette  on
30.04.2009.
2.     The facts leading to the enactment of  the  aforesaid  Amendment  Act
and its  publication  in  the  Gazette  dated  30.04.2009  would  require  a
specific enumeration and, therefore, are being recited herein below.

3.    The third respondent in the writ petition i.e. M/s Fomento  Resorts  &
Hotels Ltd. is a Company incorporated under the Companies Act, 1956.  It  is
engaged in the hospitality industry. It  is  the  owner  of  a  hotel  doing
business in the name and style of Cidade de Goa. The  said  hotel  has  been
constructed on land owned and possessed  by  the  respondent.   Sometime  in
November 1978, the third respondent addressed a letter to the Government  to
initiate acquisition  proceedings  under  the  Land  Acquisition  Act,  1894
(hereinafter referred to as ‘the Central/Principal Act’) so  as  to  acquire
land covered by Survey Nos. 803 and 804 (new nos.246/2  and  245/2)  located
within the area of Gram Panchayat Taleigao.  The said land is contiguous  to
the plot(s) owned by it on which the  hotel  was  located.   A  notification
under Section 4 of  the  Central/Principal  Act  was  issued  on  29.10.1980
declaring that the land covered by Survey Nos.803 and  804  was  needed  for
the public purpose of tourism development.

4.    As the acquisition of the land was to be made under Part  VII  of  the
Principal Act,  there was an enquiry held as contemplated under  Section  40
of the Act which was followed by an agreement dated 26.10.1983  as  required
under Section 41 of the Act.  The opening paragraphs and Clauses 3, 4 and  6
of the agreement would require  specific  notice  and  therefore  are  being
extracted herein below:

“WHEREAS the principal objects for which the  Company  is  established  are,
inter alia, construction of a tourism development project, etc. etc.

AND WHEREAS for the purpose of the construction of this tourism  development
project comprising of a hotel at Curla,  Vainguinim,  Dona-Paola,  Goa,  the
Company has applied to the Government of Goa,  Daman  and  Diu  (hereinafter
referred to as ‘the Government’) for acquisition  under  the  provisions  of
the Land Acquisition Act, 1894 (hereinafter referred to as ‘the  said  Act’)
of the pieces of land containing 19,114 sq m, situated in  the  district  of
Tiswadi and more particularly described in the Schedule appended hereto  and
delineated in the plan  hereunder  annexed  (hereinafter  called  ‘the  said
land’)   for   the    following    purpose,    namely—Tourism    Development
Project—construction of hotel at Curla, Vainguinim, Taleigao.

AND WHEREAS the Government being satisfied by an enquiry held under  Section
40 of the  said  Act  that  the  proposed  acquisition  is  needed  for  the
aforesaid purpose and the said  work  is  likely  to  prove  useful  to  the
public, has consented to acquire on behalf of the  Company  the  said  land,
hereinbefore described.

3. The said land, when so transferred to and vested in the Company shall  be
held by the Company as its property to be used only in  furtherance  of  and
for the purpose for  which  it  is  required  subject  nevertheless  to  the
payment of the  agricultural,  non-agricultural  or  other  assessments  and
cesses, if any, and so far as the said land is or may from time to  time  be
liable to such assessments and cesses under the provisions of  the  law  for
the time being in force.

4. (i) The Company shall not use the said land for any  purpose  other  than
that for which it is acquired.

(ii) The Company shall undertake the work of creation of  sports  and  other
recreational facilities/amenities within one year from  the  date  on  which
the possession of the said land is handed over to the Company  and  complete
the same within three years from the aforesaid date.

(iii) Where the Government is satisfied after such enquiry as  it  may  deem
necessary that the Company was prevented by reasons beyond its control  from
creating the  sports  and  other  recreational  amenities  within  the  time
specified in the agreement, the Government may  extend  the  time  for  that
purpose by a period not exceeding one year at a time  so  however  that  the
total period shall not exceed six years.

(iv) The Company shall keep at all times and maintain the said land and  the
amenities created thereon, in good order and condition to  the  satisfaction
of the Government or any officer or officers authorised by the Government.

(v) The Company shall maintain all  records  of  the  Company  properly  and
supply to the Government punctually any information  as  may  from  time  to
time be required by the Government.

(vi) The Company shall not use  the  said  land  or  any  amenities  created
thereon  for  any  purpose  which  in  the  opinion  of  the  Government  is
objectionable.

(vii) The  Company  shall  conform  to  all  the  laws  and  the  rules  and
guidelines made by the Government from time to time  regarding  preservation
of ecology and environment.

(viii) The Company shall never construct any building or structures  in  the
acquired land. Prior approval of Eco-Development Council of  the  Government
of Goa, Daman and Diu will be obtained  before  undertaking  activities  for
its development, besides other statutory  requirements  under  the  existing
laws.

(ix)  The  public  access/road  to  the  beach  shall  not  be  affected  or
obstructed in any manner.

6. In case the said land is not used  for  the  purposes  for  which  it  is
acquired as hereinafter recited or is used for any other purpose or in  case
the Company commits breach of any of the conditions hereof,  the  said  land
together with the improvements, if any, affected thereon,  shall  be  liable
to resumption by the Government subject however, to the condition  that  the
amount spent by the Company for the acquisition of  the  said  land  or  its
value as undeveloped land at the time of resumption, whichever is less,  but
excluding the cost or value of any improvements made by the Company  to  the
said land or any structure standing on the  said  land,  shall  be  paid  as
compensation to the Company:

Provided that the said land and  the  amenities,  if  any,  created  thereon
shall not be so resumed unless due notice of the breach  complained  of  has
been given to the Company and the  Company  has  failed  to  make  good  the
breach or to comply with any directions issued by  the  Government  in  this
behalf, within  the  time  specified  in  the  said  notice  for  compliance
therewith.”

5.    On execution of the aforesaid agreement a declaration under Section  6
was made declaring that the acquired land was required for  the  purpose  of
tourism development.  There is no dispute with regard to the fact that  with
effect from 26.3.1985 the third respondent was  put  in  possession  of  the
land in question and that the  said  respondent  had  provided   sports  and
recreational facilities/amenities on the acquired land.

6.     It  appears  that  sometime  thereafter,  on  behalf  of  the   third
respondent, an application was made to the Panjim Planning  and  Development
Authority under Section 44 (1) read with Section 49(1) of the Goa,  Daman  &
Diu Town and  Country  Planning  Act,  1974  for  grant  of  permission  for
extension of the existing hotel building on survey nos. 787,  788  and  789.
The  aforesaid  application  was  duly  considered   and   recommended   for
acceptance  by  the  EDC.  This  was  on   15.04.1988.   It   appears   that
renewal/extension of the permission granted was sought on  1.2.1991  with  a
deviation to include Survey/Plot No.803 (New 246/2) i.e. the acquired  land.
 The proposal for extension/renewal  with  the  deviation  was  not  put  up
before the EEC or the EDC and was granted straight away by the Goa Town  and
Country Planning Board in the meeting  held  on  20.6.1991.  Permission  was
granted by the Development Authority on 20.4.1992 to carry  out  development
on  land  covered,  amongst   others,   by   Survey   No.803.    Thereafter,
construction was raised by the third respondent inter alia  on  about  1,000
square mtrs. of land covered by Survey no.803 (246/2).

7.    The aforesaid construction raised and completed on  the  land  covered
by Survey No.803 (246/2) came to be challenged before the Goa Bench  of  the
Bombay High Court, inter alia by the present writ petitioner.   By  judgment
and order  dated  25.04.2000,  the  challenge  raised  was  upheld  and  the
construction made by the third respondent was ordered to be  demolished  and
the land resumed.

8.    Aggrieved, the third respondent challenged the said order of the  High
Court by instituting Civil Appeal Nos.4154-4156 of 2000  before  this  Court
which was dismissed on 20.1.2009 with the following operative directions.
“(i) The appellants are allowed three months’ time to demolish the  extended
portion of the hotel building which was constructed on 1000 sq m  of  Survey
No.  803  (new  No.  246/2)  and,  thereafter  report  the  matter  to   the
Development Authority which shall, in turn, submit a report to  that  effect
to the Goa Bench of the Bombay High Court.

(ii) If the appellants fail to demolish the building and report  the  matter
to the Development Authority within the  time  specified  in  direction  (i)
above, the authority concerned shall take action in  accordance  with  paras
(a) and (b) of the operative part of the High Court’s order.

(iii) The access shown in the plan, Ext. A attached  to  Writ  Petition  No.
141 of 1992 shall be kept open without any  obstruction  of  any  kind  from
point ‘A’ to ‘B’ in order to come from Machado’s Cove and  then  go  to  the
beach beyond Point ‘B’. If during pendency of the  litigation,  Appellant  1
has put up any obstruction or made construction to block  or  hinder  access
to the beach through Survey No. 803 (new No. 246/2), then the same shall  be
removed within one month from today.”


9.    Thereafter the Amendment Act of 2009  (Act 7 of 2009)  was  passed  by
the Legislative Assembly of Goa amending Section  41  by  addition  of  Sub-
sections 6 to 9 which  was  notified  on  30.04.1999.  The  details  of  the
amendment effect are as follows:

“Amendment of Section 41.— In Section 41 of the Land Acquisition  Act,  1894
(Central Act 1 of 1894), as in force in the State of Goa, after clause  (5),
the following shall be inserted, namely:—

(6) Notwithstanding anything contained in any judgment, decree or  an  order
of any Court, Tribunal or any  other  authority,  any  development  done  or
construction undertaken in pursuance of the  agreement  entered  under  this
section between  the  Government  and  the  Company  on  the  basis  of  the
statutory  approvals  like  permissions  granted   by   the   Planning   and
Development   Authority,   Eco-Development   Council,   Goa   Coastal   Zone
'Management Authority, Municipal Council, Panchayat, including renewals  and
deviations thereof approved and regularized, and  all  permissions  obtained
by the company and all the buildings constructed by the Company and all  the
proceedings taken by the competent  authorities  to  issue  the  license  or
permission for undertaking  construction,  shall  be  deemed  to  have  been
validly done and have always been undertaken in  accordance  with  the  said
agreement.

(7) Notwithstanding anything contained in any judgment, decree, or order  of
any Court, Tribunal or any other Authority the appropriate Government  shall
be at liberty to modify the agreement executed under  this  section  between
the Government and the Company on mutually agreed terms  in  furtherance  of
the purpose for which the land was acquired, by publication of the  modified
agreement in the Official Gazette, and any such modifications  made  in  the
agreement, shall come into  force  from  the  date  on  which  the  original
agreement with the Company was executed under this section  and  any  action
taken or things done under the modified agreement, shall, for all  purposes,
be deemed and to have always been done  or  taken  in  accordance  with  the
original agreement.

(8) Notwithstanding anything contained in any judgment, decree or  order  of
any Court, Tribunal or any other authority, if,  in  any  agreement  entered
into  between  the  Government  and  the  Company,  there  be   any   clause
prohibiting the Company to  construct  any  building  or  structure  in  the
acquired  land,  such  clause  shall  deemed  to  have  been  deleted   with
retrospective effect from 15-10-1964.

(9)  No  suit  or  other  proceeding  shall  be  instituted,  maintained  or
continued in any Court  or  before  any  Tribunal  or  other  authority  for
cancellation of such permission or for demolition of  buildings  which  were
constructed after obtaining the permissions from the  Statutory  Authorities
and have been validated under this section, or for questioning the  validity
of any action taken or things done or permission  granted  in  pursuance  of
the original agreement as modified and no Court shall enforce  or  recognize
any decree, judgment or order declaring any  such  action  taken  or  things
done under the original agreement as modified, as invalid or unlawful."


10.   The Statement of Objects and Reasons for  the  amendment  which  would
facilitate the understanding of the some of the issues arising may  also  be
noticed at this stage.

                      Statement of Objects and Reasons
“Chapter VII of the Land Acquisition Act, 1894  deals  with  acquisition  of
land by the Government for companies under this chapter. The Government  has
acquired land for various companies and for Acquiring land, the  requirement
of execution of an agreement between Government  and  Company  in  terms  of
Section  41  of  the  Land  Acquisition  Act,  1894  had  been  executed  by
Government with various companies for whom  land  has  been  acquired  under
Chapter VII of the Land  Acquisition  Act.  Recently,  the  Hon’ble  Supreme
Court in  the  case  of  Fomento  Resort  and  Hotels  Limited  and  another
Appellant(s) Versus  Minguel  Martins  and  others  Respondent(s)  in  Civil
Appeal No. 4154,4155 and 4156 of 2000 has  held  that  the  clauses  of  the
agreements have the force of law. The Hon’ble Supreme Court  has  thereafter
interpreted the clause of agreement which was not as per  the  intention  of
the parties to the agreement. The Apex Court  have  also  specifically  held
that there is no power to  amend,  modify,  alter  or  change  of  agreement
entered into as per requirement of Section  41  of  the  Act,  1894.  It  is
therefore felt necessary to  amend  the  Act  by  conferring  power  on  the
Government to modify or amend the agreement. This power  is  otherwise  also
necessary with changing time. Amendment to agreement may be the need of  the
days.

Therefore it is proposed to amend  provision  of  section  41  of  the  Land
Acquisition Act, 1894 (1 of 1894), after clause (5),  by  incorporating  new
clause namely Clauses (6),(7),(8) and (9) in order to meet  the  requirement
thereof so as to enable the Government  to  exercise  power  to  modify  any
agreement to meet the exigencies arising at any time,  wherein  acquisitions
made for Companies in which agreements under Section 41 have  been  executed
and with changing times, it may be required to  modify  such  agreements  to
bring in conformity with the purpose of acquisition or in public interest.

This Bill seeks to achieve the above objects”

11.   Thereafter on  6.3.2009  the  original  agreement  was  amended  by  a
supplementary   agreement   which   deleted   clause   4   (viii)   of   the
original/principal agreement in the following manner:
“1)That in the Principal Agreement, in Condition 4, clause (viii)  shall  be
deemed to have been deleted with retrospective effect from 26/10/83 and  the
Principal Agreement shall be so read and construed as  if  in  condition  4,
clause (viii) never existed in the Principal Deed w.e.f. 26/10/1983.

In  condition  6  of  the  Principal  Agreement,  for  the  expression   “as
hereinafter recited”, the expression  “namely  tourism  development  project
including construction of hotel” shall be substituted.

That save as varied as hereinbefore provided  in  the  Principal  Agreement,
all terms and conditions  thereof  shall  continue  to  be  binding  on  the
parties and shall be in full force and effect.”

12.   It is the validity of  the  aforesaid  Amendment  Act  that  has  been
questioned by  the  petitioner,  a  non-governmental  organization,  in  the
present writ petition.  To complete the narration of  facts,  reference  may
be  made  to  the  Land  Acquisition  (Goa  Amendment)  Ordinance  that  was
promulgated with effect from  28.02.2009  and  thereafter  replaced  by  the
impugned Legislation requiring the challenge in  the  writ  petition  to  be
shifted from the Ordinance to the Amendment Act in question.

13.   We have heard Shri Sanjay Parikh, learned counsel  appearing  for  the
petitioner, Shri A.N.S. Nadkarni, Advocate General (Goa) for the respondent-
State and Shri Rafiq Dada and Shri Dhruv Mehta, learned senior counsels  for
the private respondents.

14.   According to Shri Parikh,  learned  counsel  for  the  petitioner  the
impugned legislation seeks to nullify the directions given in  the  judgment
of this Court dated 20.1.2009.  Learned counsel  submits  that  while  there
can be no dispute that the legislature is empowered to alter  the  basis  of
the judgment of a Court but in the guise of altering the same, the  judgment
itself cannot be overruled.

15.      It is further submitted that the agreement under Section 41 of  the
Principal Act executed by respondent  no.3,  after  an  enquiry  held  under
Section 40 thereof, not only has  a  statutory  character  but  in  view  of
Section 42 of the Act the same becomes a part of the  Act  upon  publication
in the Official Gazette.  The basis of the judgment of this Court  therefore
could be changed only if a Central enactment amending the Principal Act  had
been brought about. The State Amendment,  in  the  absence  of  Presidential
assent, would be without any legal effect  in  view  of  the  provisions  of
Article 254 (2) of the Constitution.  It is also submitted  by  Shri  Parikh
that each of the sub-sections 6 to 9 brought in  by  the  Amendment  Act  of
2009 seeks to nullify the directions given by the Court/Tribunal, as may  be
and that too retrospectively with effect from 15.10.1964. It is,  therefore,
submitted that the amendment is a direct affront to the  principle  of  Rule
of law.

16.     On behalf of the petitioners it is  further  urged  that  the  State
Amendment Act is repugnant to the Principal  Act  and  not  being  saved  by
Article  254(2)  is  void  under  Article  254(1)   of   the   Constitution.
Specifically it is contended that the object of the acquisition  made  under
Part VII of the Act; the satisfaction of the Government under Section 40  of
the Act with regard to the purpose of the acquisition and  the  contours  of
the acquisition spelt out in the agreement under Section 41  which  has  the
effect  of  being  a  part  of  the  Act  itself  under  Section  42  stands
obliterated  by  the  State  amendment.   Not  only  the  scheme  under  the
Principal/Central Act for acquisition of land  for  companies  is  violated,
even the purpose of the acquisition which may not  have  been  envisaged  at
the stage of compliance with Sections 39,  40  and  41  of  the  Act  stands
altered by the  State  amendment.   Under  the  Principal  Act  it  was  not
permissible to modify/alter any  terms  of  the  statutory  agreement  under
Section    41.    The    amended    provisions     which     permit     such
modification/alteration are therefore clearly  repugnant  to  the  Principal
Act.  In the process not only a scheme which is in direct conflict with  the
existing scheme under Part VII is introduced, but the coercive machinery  of
land acquisition is permitted to be  brought  into  force  beyond  what  was
contemplated  under  the  Principal/Central  Act.   In  this  regard  it  is
specifically pointed out that Section 41 (6) permits  construction  contrary
to the conditions of the  statutory  agreement;  similarly  Section  41  (7)
permits modification of  the  agreement  that  too  retrospectively  whereas
Section 41 (8) deletes the clause prohibiting the company from  constructing
structures in the acquired land in the statutory  agreement  executed  under
Section 41.  Section 41(9), it is submitted, interferes  with  the  exercise
of the judicial power which is impermissible having regard to the  principle
of Rule of Law.

17.  The timing of the ordinance  i.e.  immediately  after  the  legislative
session had concluded, has  been  urged  on  behalf  of  the  petitioner  as
indicative of the extraneous reasons for introduction of the  same.   It  is
also urged that in the instant case it has been held by this  Court  in  its
earlier judgment  that  the  instant  acquisition  was  for  purposes  under
Section 40 (1) (aa) of the Act.  In view of the above and having  regard  to
the provisions of Section 44 (b) of the Act, which  limits  the  acquisition
for a private company only for the purpose mentioned in Section 40 (1)  (a),
the acquisition for the benefit of the third respondent  under   Section  40
(1) (aa) could not have been made at all.

18.  Opposing, Shri Nadkarni, learned  Advocate  General  as  well  as  Shri
Rafiq Dada and Shri Dhruv Mehta learned senior counsels  appearing  for  the
private respondents, including the respondent  no.3,  have  urged  that  the
basis of the judgment dated 20.1.2009 is the embargo  imposed  by  clause  4
(viii) of the  agreement  which  did  not  permit  the  respondent  no.3  to
construct the hotel on the acquired land.  The second basis of the  judgment
was with regard to the public  access  to  the  beach.   It  is  urged  that
insofar as the public access is concerned the same is in no way effected  by
the amendment.  In fact clause 4 (ix) of the agreement  is  left  untouched.
So far as the construction is concerned it is urged that the impugned  State
Legislation has cured the defects by deleting clause 4 (viii). The basis  of
the earlier judgment has consequently been removed. Support in this  regard,
is drawn from the decision of this Court in Bhaktwar  Trust  &  Ors.  v.  MD
Narayan & Ors.[1].

19.    Insofar as the issue of repugnancy is concerned it  is  submitted  on
behalf of respondents that as held by this Court in Karunanidhi V. Union  of
India[2] repugnancy can arise  only  if  the  two  sections  are  completely
irreconcilable and in direct conflict.  It is  urged  that  in  the  present
case the State  amendment  seeks  to  bring  the  agreement  executed  under
Section 41 in harmony with Section 40 (1) (aa) of the  principal  Act.   The
use of the acquired land for construction of the hotel  is  consistent  with
what has been recorded by this Court in the earlier judgment,  namely,  that
the acquisition is for the purposes contemplated by Section 40 (1)  (aa)  of
the principal Act.  In such a  situation  the  amendment  only  removes  the
embargo on construction by deleting Clause  4  (viii);  in  fact  it  really
facilitates construction for purpose of the hotel.

20.   Alternatively, it is urged that for the purpose of Article 254 of  the
Constitution the repugnancy between State and the Central  Law  must  be  in
respect of “Law” enacted by the State  Legislature  and  the  Parliament.  A
subordinate legislation or an agreement, which by a legal fiction  is  given
the effect of law (e.g. under Section 42 of the Act), does not  come  within
the scope of Article 254.  It is further urged that the language of  Section
42 makes it clear that it is only the terms of an  agreement  under  Section
41 which deals with the rights of the public  to  use  the  work,  which  is
deemed to be a part of the  Act.   The  object  behind  Section  42,  it  is
contended, is to make such part of the agreement which pertains to the  user
of the work by the public enforceable in law.  In this regard  the  findings
recorded in the earlier judgment of this Court (para 57) to the effect  that
the facility developed by the third respondent on the acquired land was  not
meant for the general public was specifically relied upon.   It  is  further
pointed out that  the  third  respondent  being  a  public  limited  company
Section  44B  of  the  Act  which  deals  with  private  companies  has   no
application.

21.   Insofar  as  the  objections  with  regard  to  the   requirement   of
Presidential assent  to  the  State  Amendment  under  Article  254  (2)  is
concerned it is submitted that though  the  original  agreement  was  signed
between the Union of India and the third respondent, by  virtue  of  Section
45 of the Goa State Reorganization Act, 1987, the  State  of  Goa  has  been
substituted  in  all  such  agreements.    Consequently,   the   Goa   State
Legislature was fully competent to carry out the State Amendment.

22.   The submission on behalf of the respondent, therefore, essentially  is
as follows :
(a)   The basis of the earlier judgment dated 20th  January,  2009,  namely,
that there was a bar to construction was removed by the State  Amendment  by
deleting Clause 4(viii) of the Agreement.
(b)   There is no repugnancy between the State Amendment and  the  Principal
Act.  In  fact  the  State  Amendment  by  permitting  construction  on  the
acquired  land  brings  about  consistency  and  harmonises  the   agreement
executed under Section 41 with the satisfaction  that  the  acquisition  was
for purpose contemplated by Section 40(i) (aa) of the Principal Act.
(c)   The agreement  does  not  lose  its  character  as  an  Agreement  and
physically becomes a part of the Act to be treated as if it is  a  law  made
by the Parliament;
(d)   In any event for the purposes of Article 254, the agreement  is not  a
law made by the Parliament and therefore not covered under Article 254.  The
Agreement for a limited purpose is given  a  deeming  fiction  to  have  the
effect of law “as if forming part of this Act.”

23.   The rival arguments give rise to two major  issues  for  determination
of the Court.  The first is the  competence  of  the  State  Legislature  to
enact the State Amendment Act in view of the earlier decision of this  Court
dated 20th January, 2009.  The second  is  whether  the  provisions  of  the
State Amendment Act are repugnant to those  of  the  Principal  Act  thereby
invalidating the State law by virtue of Article 254(2) of the Constitution.

24.   The principles on which first question would require  to  be  answered
are not in doubt.  The power to invalidate a legislative  or  executive  act
lies with the  Court.   A  judicial  pronouncement,  either  declaratory  or
conferring rights on the citizens cannot be set at naught  by  a  subsequent
legislative act for that would amount to an  encroachment  on  the  judicial
powers.  However, the legislature would be competent to pass an amending  or
a validating act, if deemed fit,  with  retrospective  effect  removing  the
basis of the decision of the Court.  Even in such  a  situation  the  courts
may not approve a retrospective deprivation of accrued rights  arising  from
a judgment by means of a subsequent  legislation  [Madan  Mohan  Pathak  and
Another vs. Union of India  and  Others[3]].   However,  where  the  Court’s
judgment is purely declaratory, the courts  will  lean  in  support  of  the
legislative  power  to  remove  the  basis  of   a   Court   judgment   even
retrospectively, paving the way for a restoration of the  status  quo  ante.
Though the consequence  may  appear  to  be  an  exercise  to  overcome  the
judicial pronouncement it is so only  at  first  blush;  a  closer  scrutiny
would confer legitimacy on such an exercise as the same is a normal  adjunct
of the legislative  power.   The  whole  exercise  is  one  of  viewing  the
different spheres of jurisdiction exercised  by  the  two  bodies  i.e.  the
judiciary and the legislature.  The balancing act, delicate  as  it  is,  to
the constitutional scheme is guided by well defined values which have  found
succinct manifestation in the views  of  this  Court  in  Bhaktwar  Trust  &
Ors.(supra).    The relevant part  of  the  opinion  expounded  in  Bhaktwar
Trust & Ors.(supra) may be noticed below.
14. The validity of any statute may be assailed on the  ground  that  it  is
ultra vires the legislative competence of the legislature which  enacted  it
or it is violative of Part III or any other provision of  the  Constitution.
It is well settled that  Parliament  and  State  Legislatures  have  plenary
powers of legislation within the fields assigned  to  them  and  subject  to
some constitutional limitations, can  legislate  prospectively  as  well  as
retrospectively. This power to make retrospective  legislation  enables  the
legislature   to   validate   prior   executive   and    legislative    Acts
retrospectively after curing the defects that led to their invalidation  and
thus  makes  ineffective  judgments  of  competent  courts   declaring   the
invalidity. It is also well settled that a  validating  Act  may  even  make
ineffective judgments  and  orders  of  competent  courts  provided  it,  by
retrospective legislation, removes the cause  of  invalidity  or  the  basis
that had led to those decisions.

15. The test of judging the validity of the amending and validating Act  is,
whether the legislature enacting the validating Act has competence over  the
subject-matter; whether by validation, the said legislature has removed  the
defect which the court had found in  the  previous  laws;  and  whether  the
validating law is  consistent  with  the  provisions  of  Part  III  of  the
Constitution.

xxxx  xxxx  xxxx xxxx  xxxx  xxxx xxxx

25. The decisions referred to above, manifestly show that it is open to  the
legislature to alter the law retrospectively,  provided  the  alteration  is
made in such a manner that it would no more be possible  for  the  Court  to
arrive at the same verdict. In other words, the very premise of the  earlier
judgment should be uprooted, thereby resulting in a  fundamental  change  of
the circumstances upon which it was founded.

26. Where a legislature validates  an  executive  action  repugnant  to  the
statutory provisions declared by a court of law,  what  the  legislature  is
required to do is first to remove the very  basis  of  invalidity  and  then
validate the executive action. In order to validate an executive  action  or
any provision of a statute, it is not  sufficient  for  the  legislature  to
declare that a judicial pronouncement given by a court of law would  not  be
binding, as the legislature does not possess that power.  A  decision  of  a
court of law has a binding effect unless the very basis  upon  which  it  is
given is so altered that the said decision would not have been given in  the
changed circumstances.

27. Here, the question before us is, whether the  impugned  Act  has  passed
the test of constitutionality by serving  to  remove  the  very  basis  upon
which the decision of the High Court in the writ petition  was  based.  This
question gives rise to further two questions — first, what was the basis  of
the earlier decision; and second, what, if  any,  may  be  said  to  be  the
removal of that basis?

28. In the earlier decision of the High Court, it was found that licence  to
construct the building up to 80 feet was repugnant to the Zonal  Regulations
framed under Section 13 of the Planning Act which provided a maximum  height
of a new building as 55 feet. Thus, the provision of the  Zonal  Regulations
which provided maximum height of 55 feet in case  of  a  new  building  was,
therefore, the basis upon which the High Court proceeded  to  conclude  that
the construction of the  building  violated  the  prescribed  norms.  It  is
manifest that the  impugned  Act  has  retrospectively  modified  the  Zonal
Regulations of 1972 by raising the height of a building from 55 feet to  165
feet. The provision of law upon which the High  Court  has  placed  reliance
has, therefore, undergone a material alteration. The High  Court  would  now
find it impossible to take the view that the said building  was  erected  in
violation  of  the  law,  and  that  the  licence  granted   therefor,   was
accordingly legally invalid.”

25.   If the above principles are to be applied to  the  present  case  what
follows is that Section 41(6) to (9) introduced in the Principal Act by  the
Goa State Amendment renders ineffective  Clause  4(viii)  of  the  Agreement
executed by the parties under Section 41 of the Principal Act.  With  Clause
4(viii) being deleted the embargo on constructions on the acquired  land  is
removed.  It is the aforesaid Clause 4(viii) and its legal effect,  in  view
of Section 42, that was  the  basis  of  the  Court’s  decision  dated  20th
January, 2009 holding the construction raised by  the  third  respondent  on
the acquired land to be illegal and contrary to  the  Principal  Act.   Once
Clause  4(viii)  is  removed  the  basis  of  the  earlier  judgment  stands
extinguished.  In fact, it may be possible to say  that  if  Clause  4(viii)
had not existed at all, the judgment of the Court dated 20th  January,  2009
would not have been forthcoming.  It was therefore well  within  the  domain
of the legislature to bring  about  the  Amendment  Act  with  retrospective
effect, the Legislative field also being in  the  Concurrent  List,  namely,
Entry No. 42 of List III (Acquisition and Requisition of  Property)  of  the
Seventh Schedule to the Constitution.

26.   The argument  in  support  of  the  plea  of  repugnancy  between  the
principal legislation (Land Acquisition Act) and the State Amendment  though
already noticed in detail may be summarized as follows:-
      The agreement under Section 41 is a  part  of  the  Principal  Act  by
virtue of Section 42 thereof.  There is a legal bar therein with  regard  to
raising of construction by the third  respondent.   There  is  no  provision
either in  the  Act  or  in  the  agreement  to  vary/amend  the  terms  and
conditions thereof. In such a situation the State  Amendment  bringing  into
operation Sub-sections (6) to (9) of Section 41, whereby the bar to  raising
of construction or illegal constructions raised (on account of the bar)  has
been invalidated in the  manner  indicated  therein,  is  repugnant  to  the
provisions of Section 41 and the terms of the agreement which are deemed  to
be a part of the Act under Section 42.
27.   In M. Karunanidhi vs. Union  of  India[4]  and  Kanaka  Gruha  Nirmana
Sahakara  Sangha  vs.  Narayanamma  (Smt)  (since  deceased)  by  Lrs.   and
Others[5] it was held that for repugnancy to arise the following  conditions
must be satisfied:
(a)   There is clear and direct  inconsistency  between  Central  and  State
Act.
(b)   Such inconsistency is absolutely irreconcilable.
(c)   Inconsistency is of the nature as to bring the two  Acts  into  direct
collision with each other and a situation is reached where it is  impossible
to obey the one without disobeying the other.

28.   We do not see how repugnancy between the two legislative exercises  on
the principles laid down in M. Karunanidhi (supra) and Kanaka Gruha  Nirmana
Sahakara Sangha (supra) can be said to exist in the present  case.   Section
41 of the Principal Act and the terms of the agreement  executed  thereunder
(even if the latter is understood to  be  ‘Law’  enacted  by  the  competent
legislature for the purpose of  Article  254)  are  silent  with  regard  to
modification/variation  or  deletion/subtraction  of  the   terms   of   the
agreement.  The State Amendment Act by bringing in Sub-sections (6)  to  (9)
of Section 41 invalidates a clause of  the  agreement  [Clause  4(viii)]  by
effecting a deletion thereof with retrospective effect i.e. 15.10.1964  (the
date of coming into operation of the Principal Act to  the  State  of  Goa).
The State Amendment, by no means, sets the law in a  collision  course  with
the Central/Principal enactment.  Rather, it may seem to be  making  certain
additional provisions to provide for something that is not barred under  the
Principal Act.  Moreover, if the provisions of the State  Amendment  are  to
be tested on the anvil of the finding of this Court that the acquisition  in
the present case is under Section 40(1)(aa) of  the  Land  Acquisition  Act,
the deletion of the relevant clause of the agreement as  made  by  the  said
amendment may appear to be really in  furtherance  of  the  purpose  of  the
acquisition  under  the  Central  Act.   We,  therefore,  do  not  find  any
repugnancy between the Principal Act and the State Amendment,  as  urged  on
behalf of the petitioners in this case.
29.   The above conclusion of ours would make it wholly unnecessary  for  us
to enter  into  the  other  two  specific  pleas  urged  on  behalf  of  the
respondent to  counter  the  challenge  of  repugnancy.   Whether  ‘Law’  in
Article 254 must be laws enacted by the  State  Legislature  and  the  Union
Parliament and not a subordinate legislation or a  statutory  flavoured  act
of the parties e.g. the agreement in the present case; whether  it  is  only
the specific part of  the  agreement  under  Section  41  published  in  the
Gazette dealing with the rights of the public which becomes a  part  of  the
Act under  Section  42  of  the  Principal  Act,  interesting  and  tempting
questions as they may be, need not be gone into  on  the  strength  of  well
developed cannons of judicial disciplines and restraint.
30.   Before parting, we deem it appropriate to put on record  that  on  the
materials  available  i.e.  Minutes  of  the  Cabinet  Meeting  dated   24th
February, 2009 preceding the  promulgation  of  the  Land  Acquisition  (Goa
Amendment) Ordinance,  2009  on  28th  February,  2009,  we  find  that  the
argument made on behalf of the petitioners that the Goa State Amendment  was
intended to benefit a singular entity i.e. the third respondent  is  without
any basis whatsoever.  The  aforesaid  Cabinet  decision  clearly  indicates
that the exercise undertaken was more broad based than what the  petitioners
would like us to hold.  In fact, there is a detailed  reference,  by  names,
in the said Cabinet decision to several other groups  and  corporations  who
are similarly situated as the third respondent.
31.   Similarly, the plea of violation of the principles of Rule of Law  and
judicial review, urged on behalf of the petitioners,  would  not  merit  any
serious  consideration  as  the  provisions  of  Sections  41(6)   to   (9),
introduced by  the  State  Amendment  insofar  as  Court  decrees/orders  is
concerned, are incidental and consequential provisions to an  Amendment  Act
validating actions that had earlier received judicial disapproval.
32.   For all the aforesaid reasons we find no merit in the  writ  petition.
We, accordingly, dismiss the same though without any  cost  and  uphold  the
validity of the Land Acquisition (Goa Amendment) Act, 2009 [Act 7 of 2009].


                                                          .......………………………J.
                                               [RANJAN GOGOI]



                                                             …………..…………………J.
                                              [PRAFULLA C. PANT]
NEW DELHI,
MARCH 29, 2016.

                        IN THE SUPREME COURT OF INDIA
                         CIVIL ORIGINAL JURISDICTION

                    CONTEMPT PETITION (C) NO. 292 of 2009

                                     IN

                        CIVIL APPEAL NO.4154 of 2000

CLAUDE ALVARES                           ...PETITIONER (S)
                                   VERSUS

SANJAY KUMAR SRIVASTAVA & ORS.    ...RESPONDENT (S)

                                  O R D E R

      In view of the judgment rendered in Writ Petition (C) No.131  of  2009
titled  as Goa Foundation & Anr. vs.  State  of  Goa  &  Anr.,   decided  on
29.03.2016 nothing survives  in  the  contempt  petition  and  the  same  is
accordingly disposed of.  Rule of notice is discharged.

                                                          .......………………………J.
                                               [RANJAN GOGOI]



                                                             …………..…………………J.
                                              [PRAFULLA C. PANT]
NEW DELHI,
MARCH 29, 2016.
-----------------------
[1]    (2003) 5 SCC 298
[2]    (1979) 3 SCC 431
[3]    (1978) 2 SCC 50
[4]    (1979) 3 SCC431
[5]    (2003) 1 SCC 228

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