UNION OF INDIA versus SUDHANSU MAZUMDAR & ORS.

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UNION OF INDIA v. SUDHANSU MAZUMDAR & ORS. March 29, 1971. [S. M. Suoo, c. J .• J. M. SHE LAT. c. A. v AJDIALINGAM, A. N. GROVER AND A. N. RAY, JJ.]

Cession-Constitution (Ninth Amendment} Act, 1960-Cession of ter

ritory 10 Pakistan-If acquisition within the meaning of Art. 31(2).

Constitution of India, 1950, Art. 31(2)-<:ession of territory to foreign

State if acquisition.

Constitution of India, 1950-Article 132(1)-<:ertificate by Single Judge

-Propriety of.

Pursuant to the Indo-Pakistan Agreement, 1958, and after this Court's· Advisory opinion in In re the Berubari Union and Exchange and Enclaves, (1960] 3 S.C.R. 250, Parliament enacted the Constitution (Ninth Amend ment) Act, 1960 for cession of part of the territory of India to Pakistan. In order to implement the provisions of the Act a physical demarcation of the portion that had to be ceaded was necessary. The respondents filed a petition under Art. 226 of the Constitution before the High Court challen ging the validity of the proposed demarcation principally on the ground that they would be deprived of their property without compensation. A single Judge of the High Court held that the cession of the territory in volved transfer of ownership and other private property rights to Pakistan through the Union of India, which, though outside cl. 2A of Art. 31 was compulsory acquisition within the meaning of Art. 31(2). The single Juds~ granted a certificate under Art. 132(1) for appeal to this Court.

HELD: (1) No question of acquisition within the meaning of Article 31(2) is involved in the present case. The Constitution (Fourth Amend ment) Act, 1955, makes it clear that mere deprivation of property unles• it is acquisition· or requisitioning within the meaning of cl. 2A will not attract cl. (2) and no obligation to pay compensation will arise thereunder and it is essential under clause (2} that in order to constitute acquisition or requisitioning there must be transfer of the ownership or right to pos session of the property to the State or to a co_rporation o"vned or controll ed by the State. Cession indisputably involves transference of sovereignty from one sovereign State to another. But, there is no transference of owner. ship or right to possession in the properties of the inhabitants of the ter ritory ccdt.d to the ceding State itself. The effect of the Constitution (Ninth Amendment) Act, 1960, can by no stretch of reasoning be regard ed as transfer of .the ownership or right to possession of any property of the respondents to the "State" within the meaning of Article 12 of the Constitution.

[202C-F, HJ

Charanjit Lal Chowdhury v. Union of India, (1950] S.C.R. 869, 902. State of West Bengal v. Subodh Gopal Bose & Ors. [1954] S.C.R. 587, Dwarkadas Shrinivas of Bombay v. Sholapur Spinning ... t Weavbig Co. Ltd. & Ors. [1954] S.C.R. 674, Saghir Ahmed v. State of Uttar Pradesh, (1955] 1 S.C.R. 707 and Gul/apalli Nage>wara Rao & Ors. v. Andhra Pradesh State Road Transport Corporation & Anr. (1959] Supp. 1 S.C.R. 319, referred 10.

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(ii) l'his Court has on earlier occasions, observed that the practice of a single Judge deciding the case and giving a certificate under Article 132 (1) for appeal to this Court, although technically correct, was an improper practice and that such a certificate should be given only in very exceptional cases where a direct appeal was necessary. The present case may be of an exceptional kind; but this Court has been deprived of the benefit of the judgment of a larger Bench of the High Court on points which are of substantial importance.

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R. D. Agarwala. & Anr. v. Union of India & Ors .. C.A. Nos. 2634/69 etc. dt. 23-2-1970 and Union of India v. J. P. Mitter, [1971] 3 S.C.R. 483, referred to.

OVIL APPELLATE JURISDICTION: Civil Appeal No. 974 of

1968.

Appeal from the judgment and order dated December 22, 1967 and January 3, 1968 of the Calcutta High Court in Civil Rule No. 3369(W) of 1966.

L. M. Singhvi and S. P. Nayar, for the appellant.

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A. K. Dutta and K. Rajendra Chowdhary, for respondents D

Nos. 1 to 3.

Santosh Chatterjee and G. S. Chatterjee, for respondent No. 4

The Judgement of the Court wa.i delivered by

Grover, J.-This is an appeal from a judgment of a learned single judge of the Calcutta High Court who granted a certificate under Art. 132(1) of the Constitution. It inyolves primarily the question whether the cession of a territory by India as a result of a treaty with Pakista.n would be compulsory acquisition of the property comprised in that territory by the Union of India and would, therefore, attract the provisions of Art. 31 of our Consti tution.

At the outset it may be mentioned with reference to a preli minary objection which has been raised by the respondents that the judgment under appeal waii delivered by the learned single Judge in a petition under Art. 226 of the Constitution and it appears that on an oral prayer made to him he granted a certi ficate under Art. 132(1) even though under the Letters Patent of the High Court an a.ppeal lay to a division bench of that court. This Court has said on an earlier occasion in clear and unequivocal terms that the practice of a single Judge deciding the case and giving a certificate under Art. 132(1) for appeal to this Court, al though technically correct, was an improper practice. The right of the parties to file an appeal in the High Court itself against the decision of the single Judge should not be short-circuited. Indeed

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in R. D. Agarwala & Another etc. v. Union of India & Ors.(') the In Union of India v. J. P. Mitter(') it certificate was cancelled. was observed that a certificate by a single judge under Art. 132(1) should be given in very exceptional cases where a direct appeal was necessary. Even though ·the present case may be of an excep tional kind we have been deprived of the benefit of the judgment of a larger bench of the High Court on points which are of sub stantial importance. Presumably a number of matters which had no bearing on the real questions to be determined and which have been dealt with by the leacned single judge would have been either satisfactorily disposed of or would not have been the subject matter of discussion by the court, being irrelevant and unnecessary, if the decision had been given by a larger Bench.

The facts ma.y be shortly stated. On September 10, 1958, an agreement was entered into between the Government of India and Pakistan called the Inda-Pakistan Agreement. Item No. 3 of the agreement related to Berubari Union No. 12 which was a group of villa·ges lying within the territory of India. This territory was to be so divided as to give one half area to Pakistan. The other half adjacent to India was to be retained by India. Subsequently a doubt arose whether the implementa.tion of the agreement relat· ing to Berubari Union required Legislative action either by way of an Act of Parliament relatable to Art. 3 of the Constitution or by way of a suitable amendment of the Constitution in a.ccordance with the provisions of Art. 368 or both. A similar doubt had also arisen in respect of another item of the agreement which related to the exchange of certain enclaves but with which we are not con this cerned. The President of Court under Art. 143(1), of the Constitution for its oovisory opinion. The opinion was deliveried on March 14, 1960. (In Re: The Berubari Union and Exchange of Enclaves Refer· ence Under Article 143 (I) of the Constitution of India('). As mentioned in the advisory opinion Berubari Union No. 12 had an area of 8·75 Sq. Miles and a• population of 10 to 12 thousand resi· It was situated in the district of Jalpaiguri. This Court dents. expressed the view that since the agreement between India and Pakistan amounted to cession of a pa.rt of the territory of India in favour of Pakistan its implementation would naturally involve the alteration of the content of and the consequent amendment of Article I and of the relevant part of the First Schedule to the Constitution which could be made only under Article 368. Pur suant to the opinion delivered by this Court the Parliament enacted

India made a reference to

(I) C. As. 2634/69 & 63/70 decided on 23·2· 70. (2) [1971] 3 S.C.R. 483. (3) [1960] 3 S. C. R. ZSO.

UNION v. s. MAZUMOAR (Grover, J.)

the Constitution (Ninth Amendment) Act 1960 on December 28, In order to implement the provisions of the above Act a 1960. physical division of the Berubari Union in accordance with the agreement and demarcation of the portion that was to go to Pakis tan was necessary. Some of the inhabitants of the Berubari Union filed a petition under Article 226 of the Constitution challenging its proposed partition with the object of transferring its southern part to Pakistain. The writ petition was dismissed and an ap peal was brought to this Court which was disposed of on August (Ram Kislwre Sen & Others v. Umon of India & II, 1965. It was helil that the Ninth Constitution Amendment Act Ors.)('). had been passed by the Parliament in the manner indicated in the advisory opinion of this Court. No merit was found on the other points which were agitated. The appeal was dismissed.

On June 11, 1965, the respondents filecl another petition under Article 226 of the Constitution before the High Court challenging the validity of the proposed demarcation principally on the ground that they would be deprived of the right of citizenship conferred by the Constitution of India and also of their property without pa.y ment of compensation. D. D. Basu J. called for an affidavit in opposition and after hearing lengthy arguments delivered an ela borate judgment A.LR. 1967 Cal. 216) directing the issue of rule nisi limited to ground No. 3 of the writ petition. This ground was:

"For that no Act of the State is involved in the trans fer of Berubari Union No. 12 to Pakistan a.nd as such your petitioners are entitled to compensation in terms of Art. 31(2) of the Constitution inasmuch as the operation of transfer involves deprivation of their right to property for which no provision has been made in the Constitution 9th Amendment Act, 1960."

According to the allegation in the writ petition respondent Dhano swar Roy had 2 acres 64 decima.ls of khas land in the area in q ues It was also claimed that the respondents had their house tion. hold property, ancestral homes and cultivated lands in the Beru· bari Union No. 12.

The constitutional question formulated by the learned judge was whether compensa.tion under Article 31(2) of the Constitu tion was to be provided for the respondents before the demarca tion in implementation of the Constitution (Ninth Amedment) Act took place. We may mention some of the material conclusions of the learned judge out of the numerous matters dealt with by

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-- (I) (1966] 1 S. C. R. 430.

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is complete.

him. These are : (!) the treaty making power must be exercised subject to the fundamental rights guaranteed by the Constitution. (2) Once it is established that a treaty making Jaw involves a trans fer which attracts Art. 31(2) it cannot be exempted from the re quirements of tha.t Article on the ground that it is a treaty of "ces (3) Although under the International Law the private sion". territory are not instantly rights of the inhabitants of the ceded affected they shall have no legal right to assert against the new State under its own municipal Jaw to which such inhabitants shall (4) As a be subject from the moment the cession result of cession it would be competent for the Government of Pakistan to deal with the disputed territory as absolute owner in complete disregard of the existing rights of the respondents. "The rights of the Government of Pakistan under its municipal law would in no way be Jess than whait would have happened if the lands were vested in that Government by a direct Act of the Govern ment of India. Such vesting the Government of India could (5) The arrange for only after acquiring the disputed present case will not be covered by clause 2(A) of Article 31 of the Constitution as so far all the ca6es which have been held to fall within its purview have been those in which there was exercise of the regulatory power of the State. (6) The cession of the disputed properties sought to be implemented by the impugned demarca tion involved compulsory acquisition of those properties by the Union of India within the meaning of Art. 31 (2) and unless com petent legislation is enacted to provide for compensaition the Union cannot announce the appointed day within the meaning of s. 2(A) of the Constitution <Ninth Amendment) Act 1960 &nd for construc ting pillars to demarcate Berubari Union No. 12 for the purpose of effecting the transfer of the specified portion to Pakistan.

lands''.

Accord_ing to Dr. Singhvi learned counsel for the appellant the High Court has fallen into serious errors inasmuch as it has proceeded on many assumptions, reasoned on a priori theories and has founded its judgment on certain premises which do not e~:ist either in fact or in Jaw. Stress has been lruid on the true import of "cession''. According to all authorities on International L~w "cession" is the transfer of sovereignty over the State territory by the owner State to another State"('). Under the International Law two of the essential attributes of sovereignty are the power to ac quire foreign territory as well as the power to cede national terri tory in favour of foreign State(') (supra at p. 281). Hardship is certainly involved in the fact that in all cases of cession the inhabi· tan ts of the territory ceded lose their old citizenship and have to submit to a new sovereign whether they like it or not. As the object of cession is sovereignty over the ceded territory all such

(I) Oppenbeim's International L•W V< !. (2) [1960] 3 s.c.R. 250.

l, 8th Edn. at pp. 547, 551.

UNION v. s. MAzUMDAR (Grover, J.)

individuals domiciled thereon as are subjects of the ceding State become ipso facto, by the cession, subjects of the acquiring State(') (supra at p. 551).

Dr. Singhvi says that the first premise on which the High Court has proceeded is that as a result of cession it would be competent for the Government of Pakistan to deal with the dis puted territory a8 an absolute owner in complete disregard of the existing rights of the respondents. In other words it has been as sumed that the Government of Pakistan will not recognise owner ship or other similar rights of the respondents in. the lands and properties which belong to them. This, Dr. Singhvi claims, is contrary to the rule enunciated by Chief Justice Marshall in The United States v. Juan Perchman(') in the following words:-

"The modern usage of nations, which has become law, would be violated; that sense of justice and of right which is acknowledged and felt by the whole civilised world would be outraged, if private property should be generally confiscated a.nd private rights annulled. The people change their allegiance; their relation to their an cient sovereign is dissolved; but their relations to each other and their rights of property, remain undisturbed."

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The rule set forth in the Perchman case has been followed in over forty American ca;;es and has been accepted as the rule of Inter national Jaw in English, French, German and Italian law(').

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This Court has had occasion to consider fully the Perchman's case as also the English law apart from several other autho- rities on International law and the decisions of the Permanent Court of International Jutice. In State of Gujarat v. Vora Fiddali the the Badruddin Mithibarwala(') judgment of Mudholkar J., at pages 590, 591 gives tersely the position which obtains in our country :-

following passage

from

"Thus while according to one view there is a Sta.le succession in so far as private rights are concerned ac cording to the other which we might say is reflected in our laws, it is not so. Two concepts underline our law; one is that the inhabitants. of acquired territories bring with them no rights enforceable a.gainst the new sovereign. The other is th!llt the municipal courts have

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(I) Opp,nheim's lntecnational L1w Vol. ',8th Edn. at pp. 547, 551. (2) 8 L. ed. 604. (3) Extracts from the L1w of N 1tions (2nd Edn. 1953 p. 237 Cf. F. B. H S1yic, '"Change of S Jve:-eigntY and Private Ownership of Land," 12 XlXL A. J. I. L. (19!8), 475, 481, 495-497.

(4) [1964] 6 S. c. R. 46!.

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no jurisdiction to enforce any rights claimed by them, even by virtue of the provisions of a treaty or other transacticn internationally binding on the new sovereign unless their rights have been recognised by the new sovereign."

The above case related to rights pertaining to the exploitation of the forests which were claimed under a Tharao which was held by the majority to be a grant to the jagirdars by the ruler of the erstwhile Sant State which mergtd in the Dominion of India as from June JO, 1948. It was thus held that the rights derived by the inhabitants of the ceded territory from its former rulers. could not be enforced by them a.gains! the new sovereign in the courts of that sovereign unless they had been recognised by the new sovereign. It is altogether unnecessary to discuss the princi ples established by the decisions of this Court further because· they can afford no assistance in deciding the present case in which: no question arises of how the private rights of the inhabitants of a particular territory would be affected if the same were to be ceded to India. The cession involved is of territory to Pakistan and no evidence was placed before the High Court ·from which it could be concluded tha.t under the Pakistan Jaws the private rights of the inhabitants therein would. not be respected in accor dance with the ordinary principles of •Internaitional Jaw. In this situation it would be a wholly wrong approach to conclude that the respondents are bound to lose all their property rights in the territory which is being ceded by India to Pakistan. Even on the assumption that the respondents will not he entitled to enforce their private rights in the municipal courts of Plikistan unless they are recognised by the new sovereign it is incomprehensible how such a prospect or possibility can attract the wpplicability of Art. 31(2) of our Constitution so as to entitle the respondens to com pensation as provided thereby. Nor can we understand the pro cess of reasoning by which the High Court has reached the result tha,t cession would be tantamount to vesting by the direct act of the Government of India of the properties of the respondents in Pakistan.

In order to determine whether the case of the respondents would fall within Art. 31(2} it is necessary to set out that provi sion as also para 2A of that Article which was added by the Constitution (4th Amendment) Act 1955 :

(2) "No property shall be compulsorily acquired or requisitioned save for a. public purpose and save by authority of a Jaw which provides for compensation for the property so aquired or requisitioned and either fixes the amount of the compensation or sF.fies the princi ples on which, and the manner in which, the compensa-

UNION v. s. MAZUMDAR (Grover, J.)

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tion is to be determined and given; and no such law shall be called in question in any court on tbe ground tbat tbe compensation provided by tbat law is not adequate."

(2A) Where a law does not provide for tbe transfer of tbe ownership or right to possession of a.ny property to tbe State or to Ill corporation owned or controlled by the State it shall not be deemed to provide for tbe compul sory acquisition or requisitioning of property, notwith standing tbat it deprives any person of his property." As far back as 1950 Mukherjea J. (as he tben was) gave the mean ing of "acquisition" in Chmanjit Lal Chowdhury v. Union of India(') in the following words:

"Acquisition means and implies tbe . acquiring of tbe entire title of tbe expropriated owner, whatever tbe nature or extent of tbat title mi8ht be. The entire bundle of rights which were vested in the original holder would pass on acquisition to tbe acquirer lelllving nothing in tbe former".

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But in tbe State of West Bengal v. Subodh Gopal Bose & others(') the view taken in the judgment of the majority was that clauses I and 2 of Article 31 were not mutually exclusive in scope and content but should be read together and understoOd as dealing with the same subject. Thus a wider meaning was given to· acquisition, deprivation contemplated in clause I being no other than the acquisition or taking possession of the property referred to in clause('). In Dwarkadas Shrinivasa of Bombay v. The Sholapur Spinning & Weaving Co. Ltd. & Others(') this Court, while con firming the above principle, held that the word "acquisition" had quite a wide concept, meanin!!l the procuring of ·property or taking of it permlllnently or temporarily and it was not confined only to the acquisition of a legal title, by the State in the property taken possession of. This was the position relating to Art. 31 as it stood (4th Amendment) Act, Clause 2A before the Constitution was inserted in 1955 with the object of superseding tbe ma jority decision in Subodh Gopal's(') case as also in Saghir Ahmed v. The State of Uttar Pradesh(') in which the earlier decisions were G followed. It was pointed out in Gullapalli Nageswara Rao & other v. Andhra Pradesh State Road Transport Corporation & Another(') :

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"The Constitution (Fourth Amendment) Act, 1955 Amended clause (2) of Art. 31 and inserted clause 2A in

(I) [19SO] S. C.R. 869 at p. 902. (3) [19S4] S. C. R· 674. (5) [19S9] Suppl. IS. C.R. 319.

(2) [19S4] S. C.R. 587. (4) [19SS] I S. C. R· 707.

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acquired'

acquired or

'taken possession or

that article. The amendments, in so far as they a•e rele vant to the present purpose, substitute in place of the the words words requisitioned' and pro 'compulsorily vide an explanation of the words 'acquired a·nd requisi tioned' in clause (2A). The result is that unless the law depriving any person of his property provides for the transfer of the ownership or right to the possession of any property to the State, the law does not relate to 'acquisition or requisition' of property a-nd therefore the limitations placed upon the legislature under cl. (2) will not apply to such law."

It is therefore essential that in order to constitute acquisition or requisitioning there must be transfer of the ownership or right to possession of any property to the State or to a corporation owned or controlled by the State. Article 12 provides thai in Part III (in which Article 31 appears) unless the context otherwise requ- . ires the State "includes the Government and Parliament of India and the Government and the legislature of each of the States and all locaJ or other authorities within the territory of India or under the control of the Government of India. The effect of the Constitution (Ninth Amendment) Act 1960 by which part of the Berubari Union No. 12 shall be ceded to Pakistan can by no stretch of reasoning be regarded as a transfer of the ownership or right to possession of any property of the respondents to the State within the meaning of Art. 12 of the Constitution. The amendment of 1955 makes it clear that mere deprivation of pro perty unless it is acquisition or requisitioning within the meaning of clause (2A) will not attract clause (2) and no obligation to pay compensation will arise thereunder.

Cession indisputably involves transference of sovereignty from one sovereign State to another. There is no transference of ownership or right to possession in the properties of the itiliabi tants of the territory ceded to the ceding State itself. The Consti tution (Ninth Amendment) Act having been enacted in accodance with the Advisory opinion of this court(') there can be no impe diment in the way of ceding part of Berubari Union No. 12 pursuant to the Indo-Pakistan Treaty 1958. The view of the High Court that the cession of the said territory involves transfer of the ownership and other private property rights to Pakistan through the Union of India which was outside clause(2A) of Arti cle 31 and was covered by clause(2) of that Article is to say the In our judg least wholly untenable and cannot be sustained. ment no question of acquisition within Art. 31(2) is involved in the present case and even though a good deal of hardship may result to the respondents owing to the change of sovereignty they

(I) [1960] 3 S. C. R. 250.

UNION •• S. lllAZUMDAR (Grover, J.)

cannot claim compensation for the simple rea5on 'that there has been no transfer of the ownership of their property to the State namely the Union of India which would attract the applicablilty of Art. 31(2}.

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The appeal, therefqre, succeeds and it is hereby allowed. In view of the nature of the points decided there will be no order as to costs.

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Appeal allowed •

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