1. This judgment will dispose of both these petitions under Articles 226 and 227 of the Constitution.
2. The petitioner Vithalrao in Special Civil Application No. 504 of 19G7 claims to be cultivating Khasra Nos. 51, 58, 60, 48, 03, 46 and 64, situate at village Binakhi in Patwari 'Circle No. 10 in Tahsil and District Nagpur under a registered lease deed dated July 9, 1047, from one Mohomed Hassan Nurani Malak. The petitioner also claims that he is recorded as a tenant in the record of rights and the tenants' list prepared under Section 8 of the Bombay Tenancy and Agricultural Lands Act, 1958, applicable to this region.
3. The petitioners in Special Civil Application No. 506 of 1967 claim to be owners of Khasra No. 62 held in Bhumidhari rights at the same village-Binakhi.
4. By not ice dated May 3, 1062, respondent No. 2, that is, the Nagpur Improvement Trust, Nagpur published under Section 39 of the Nagpur Improvement Trust Act, 1936, notified that a Housing Scheme known as the Binakhi Housing Accommodation Scheme was framed by the Nagpur Improvement Trust. The agricultural lands held by the petitioners in both these petitions are included in the property comprised in this scheme along with other areas. Thereafter on February 17, 1964, the Nagpur Improvement Trust made an application to the State Government for according sanction to the scheme at an early date. In para, (x) of this letter the Chairman of the Nagpur Improvement Trust stated as follows:
It is requested that the State Government may please move to sanction at an early date the Binakhi Housing Accommodation Scheme of the Nagpur Improvement Trust and simultaneously pass orders directing the Collector, Nagpur, to take action for the acquisition of the properties as per enclosed list under Section 7 of the Land Acquisition Act.
Though the annexures to this letter are not included in the paper book, it is common ground that the lands belonging to the petitioners or in their possession were included in the Scheme.
5. On January 9, 1965, the State Government purporting to act under Section 44 of the Nagpur Improvement Trust Act accorded its sanction to the said scheme subject to certain condition that adequate areas are reserved for public purposes, like schools, open spaces etc. and the width of proposed main roads are as shown in the Master Plan of Nagpur. The Trust was also directed to provide all the amenities mentioned in the Director of Town Planning's letter before the zoning and layout regulations for any one of the precincts from this area are submitted to Government for sanction under Section 90 of the Nagpur Improvement Trust Act, 1936.
6. Thereafter the proceedings seem to have commenced in the Court of the Land Acquisition Officer in Revenue Case No. 'D/A-65 of 1965-66. The petitioners have filed copies of order-sheets in the proceedings before the Land Acquisition Officer and the first order-sheet shows that order under Section 7 of the Land Acquisition Act sanctioned by the State Government for starting acquisition in respect of Khasra No. 48 situated at Binakhi for the sanctioned scheme of the Nagpur Improvement Trust, namely, Binakhi Housing Accommodation Scheme was received. After following the procedure required for determination of compensation, the Land Acquisition Officer passed his award on June 12, 1067 and the order-sheet of that date shows that notices were issued to the parties for delivery of possession on June 16, 1967, with a memo to the Trust for deposit of compensation amount. The copy of the Award has been filed in each case. The Land Acquisition Officer awarded in the case of property claimed by the petitioner in Special Civil Application No. 504 of 1907 a sum of Rs. 45,910. Similarly, in the case of the petitioners in Special Civil Application No. 506/67, the Land Acquisition Officer determined the. compensation at Rs. 8,075 in respect of Khasra No 68/2. It is an admitted position that the compensation has been determined in each of these cases according to the provisions of the Laud Acquisition Act and in particular, the provisions of Section 23 of that Act, as they stood amended by the provisions of the Nagpur Improvement Trust Act.
7. These petitions were filed soon thereafter in this Court challenging the validity of the award, principally on the ground, that the provisions of the Nagpur Improvement Trust Act, in so far as they modify the provisions of the Land Acquisition Act, 1894, in the matter of determination of compensation and the basis for payment of compensation, are 'ultra vires of the powers of the Legislature on different grounds;. Briefly, the challenge to the provisions of the Act regarding the mode and principle of determination of compensation for land acquired for the purposes of the Trust was three-fold as follows:
That the amended provisions of Section 28(3)(a) end the amendment of Sub-section (S) of Section 23 of the Land Acquisition Act adding a proviso are offending the provisions of the Government of India Act, 19SS and also the Articles 14 and 31(2) of the Constitution.
8. The impugned provisions are as follows:
28.(3) For the purposes of clause first of Sub-section (1) of this section, substitute,
(a) the market-value of the' land shall be the market-value according to the use to which the land was put at the date with reference to which the market-value is to be determined under that clause....
Sub-section (2) of Section 23 was amended to read
Provided that this sub-section shall not apply to any land acquired under the Nagpur Improvement Trust Act, 1986, except-
(a) buildings in the actual occupation of the owner or occupied free of rent by a relative of the owner, and land appurtenant thereto, and
(b) gardens not let to tenants but used by the owners as a place of resort.
9. The grievance of the petitioners is that by adding Sub-clause '(a) to Sub-section (5) of Section 23 of the Land Acquisition Act, 1894, the Legislature has unduly restricted the market value being determined according to the use to which the land was put at the date of the reference and thus precluded the Collector from taking into due consideration the potential value of the land as on that date. , .
10. With regard to the proviso added to Sub-section (2) of Section 23 of the Land Acquisition Act, it is complained that, whereas in the case of properties acquired under the Land Acquisition Act, 1894, in addition to the market value of the land as provided, the Court was bound in every case to award a sum of fifteen per, cent, on such market value , in consideration of the compulsory nature of the, acquisition, this additional benefit is denied to persons whose property is being acquired for the Improvement Trust, by restricting this benefit, only in respect of buildings in the actual occupation of the owner or occupied free of rent by a relative of the owner, and land appurtenant thereto and also gardens not let to tenants but used by the owners as a place of resort. So the solatium of-fifteen per cent, which is normally payable for compulsory acquisition of land has been denied to the petitioners in these cases.
11. The first attack on these provisions was based on the assumption that the Nagpur Improvement Trust Act, 1936, had violated the provisions' of Section 299 of the Government of India. Act, 1935. Tinder Section 299(2) of the Government of India Act, ', 1935, neither the Dominion Legislature nor a Provincial Legislature had power, to make, any law authorising the compulsory acquisition for public; purposes of any land, or any commercial or industrial undertaking, or any interest in,', or in any company owning, any commercial or industrial undertaking,,, unless the law provided for the payment of compensation for the property acquired and either fixed the amount of the compensation or specified, the principles, on, which, and ;the manner in which, it. was to be determined The compensation .within the meaning of this provision was a just and fair equivalent of the value of the property compulsorily acquired. But this challenge was not open to the petitioners inasmuch as the Government of, India Act, 1'935, was not in force in India, at any rate any provisions, of Chapter II in Part XII wherein this provision is included in that Act until a long time :after the Nagpur Improvement Trust Act was passed by the competent Legislature of the Province of the Central Provinces and Berar and was put on the Statute Book. The Nagpur Improvement Trust Act, 1936, also designated as C. P. and Berar Act No. 36 of 1036 was, published in: the Central Provinces Gazette dated December 25, 1936. On the other hand, the provisions of Part XII of the Government of India Act, which put a restriction on the legislative power of the Provincial Legislature, came into force on April 1, 1937, as provided in the Government of India (Commencement and Transitory Provisions): Order, 1936. "When this position was pointed out, the learned Counsel for the petitioners did not press this contention. This ground of attack, therefore, is not available to the petitioners.
12. The next contention of the petitioners was that the provisions of the Nagpur Improvement Trust Act to which objection is taken in the matter of determination of proper compensation for property compulsorily acquired, violate the guarantee under Article 31(2) of the Constitution inasmuch as the property was being compulsorily acquired although for public purpose which did not provide for adequate compensation for the property so acquired and had neither fixed the amount of compensation nor specified the principles on, which, and the manner in which, the compensation was to be determined and given. Here again, the challenge was to provisions as appearing in amended Section 23(5)(a) and the proviso to Sub-section (2) of Section 23, already quoted above, denying to the person whose property was being acquired, the solatium of fifteen per cent, and compensation for the potential value of the property. This contention is also not well-founded in view of the provisions of Clause (5) of Article 31 of the Constitution. Under that clause, nothing in Clause (2) shall affect the provisions of any existing law, other than a law to which the provisions of Clause (6) apply. It is not disputed, and cannot be disputed, that the Nagpur Improvement Trust Act, 1936, is an existing law within the meaning of the definition of that phrase in Article 336(70) of the Constitution. This being the law passed before the commencement of the Constitution by competent Legislature haying power to make such law is immune from challenge on this ground under Article 31(2) of the Constitution. This ground of attack, therefore, must also fail.
13. The third ground of attack is based on the guarantee of protection; of equality before law and equal protection of laws under Article 14 of the Constitution.. In order to understand and appreciate the rival contentions in this regard, it is necessary to examine the scheme of the provisions of the Nagpur Improvement Trust Act, 1936, the provisions of the Land, Acquisition Act, 1894 and some other relevant provisions of the statute.
14. For convenience of reference, the Nagpur Improvement Trust Act, 1936, will hereafter be referred to as the Improvement Trust Act. This Improvement Trust Act was put on the statute book as far back as December 1936. The Act, as the preamble shows, has been made to make provision for the improvement and expansion of the Town of Nagpur in the manner provided in the Act. 'Land' has1 the meaning assigned to it in Clause (a) of Section 3 of the Land Acquisition Act, 1894. Chapter II deals with the constitution of the Improvement Trust and Chapter III deals with the proceedings of the Trust and Committees of the Trust. Chapter IV makes provisions for the different schemes which can be undertaken or framed by the Improvement Trust. A large variety of schemes which can be undertaken are indicated in Section 26 of the Improvement Trust Act. An improvement scheme may provide for acquisition by purchase, exchange, or otherwise of any property necessary for or affected by the execution of the scheme, for recovery of betterment contributions, for relaying out of any land comprised in the scheme or for the redistribution of sites belonging to owners of property which arc unfit for human habitation, or demolition of obstructive buildings or portions of buildings, or construction and reconstruction of buildings, any sale, letting or exchange of any property comprised in the scheme, construction and alteration of streets and back lanes, draining water-supply and lighting of streets so constructed or altered, or the provision may be made for parks, playing fields and open spaces for the benefit of any area comprised in the scheme or any adjoining area and the enlargement of existing parks, playing fields, open spaces and approaches. The provision may be made for markets, motor vehicle stands, fire brigade stations, theatres, public urinals and latrines, petrol service stations and other public amenities or the sites therefor, the sanitary arrangements required for the area comprised in the. scheme, including the conservation and prevention of injury or contamination to rivers or other sources and means of water-supply. The scheme may also provide for accommodation for any class of the inhabitants and for facilities of communication, or for reclamation or reservation of land for market, gardens, afforestation, or any other matter for which, in the opinion of the State Government, it is expedient to make provision with a view to the improvement of any area, or for the general efficiency of the scheme.
15. Section 27 then indicates the types of improvement schemes which may be undertaken, such as a general improvement scheme, a re-building scheme, a rehousing scheme, a street scheme, a deferred street scheme, a development scheme, a housing accommodation scheme, a future expansion or improvement scheme among others. Sections 28, 29, 30, 31, 32 and 33 indicate in what manner the general improvement scheme, a re-building scheme, a re-housing scheme, a street scheme or a deferred street scheme etc. may be undertaken. Section 34 empowers the Trust when it is of opinion that it is expedient and for the public advantage to provide housing accommodation for any class of the inhabitants of any area to which the Act extends to frame a scheme called a housing accommodation scheme. The scheme in pursuance of which the property has been acquired in these two petitions is one such scheme for providing housing accommodation.
16. Section 36 lays down the procedure to be followed in framing an improvement scheme. Such an improvement scheme may be framed by the Trust either on its own motion or on a written complaint by the 'Chief Executive Officer of the Corporation or in respect of any area on a written complaint signed by twenty-five or more residents of a ward of the Corporation, tinder Section 37, the Trust is enjoined to consider all such representations before taking a decision. Under Section 38 of the Improvement Trust Act, when framing an improvement scheme in respect of any area, the Improvement Trust is required to have regard to the nature and the conditions of neighbouring areas and of the town as a whole, the several directions in which the expansion of the town appears likely to take place and the likelihood of improvement schemes being required for other parts of the town. Section 39 is important and has bearing on the controversy in these cases. It is as follows:
39.(1) When any improvement scheme has been framed, the Trust shall prepare a notice, stating-
(a) the fact that the scheme has been framed,
(b) the boundaries of the area comprised in the scheme, and
(c) the place at -which particulars of the scheme, a map of the area comprised in the scheme, and a statement of the land which it is proposed to acquire and the land in regard to which it is proposed to recover a betterment contribution, may be seen at reasonable hours.
(2) The Trust shall-
(a) cause the said notice to be published weekly for three consecutive weeks in the official Gazette and in a local newspaper or newspapers, if any, with a statement of the period within which objections will be received, and
(b) send a copy of the notice to the C.E.O. of the Corporation.
(3) The Chairman shall cause copies or extracts of all documents referred to in Clause (c) of Sub-section (1) to be delivered to any applicant on payment of such fees as may be prescribed by regulation.
17. Section 41 casts a duty on the Trust to Issue notices to certain persons designated in Clauses (a) and (b) of Section 41(1) and what that notice shall be is provided in Section 41(3), It will be seen that this notice is required to be given only to persons whose names appear in the Municipal Assessment List or to the occupier of such premises entered in the Municipal Assessment List which the Trust proposes to acquire in executing the scheme. Section 43 is another important section and is as follows:
43.(1) After the expiration of the period respectively prescribed under Clause (a) of Sub-section (2) of Section 89, by Section 40, and by Clause (b) of Sub-section (2) of Section 41, in respect of any improvement scheme, the Trust shall consider any objection, representation or statement of dissent received thereunder, and after hearing all persons making any such objection, representation or dissent, who may desire to be heard, the Trust may either abandon the scheme or apply to the State Government for sanction to the scheme with such modifications, if any, as the Trust may consider necessary.
(2) Every application submitted under Sub-section (1) shall be accompanied by-
(a) a description of, and full particulars relating to, the scheme, and complete plans and estimates of the cost of executing the scheme;
(b) a description of the street, square, park, open space or other land, or any part thereof, which is the property of the Government and managed by the Central Government or the State Government required for the scheme;
(c) a statement of the reasons for any modifications made in the scheme as originally framed ;
(d) a statement of objections, if any, received under Section 89;
(e) any representation received under Section 40;
(f) a list of the names of all persons, if any, who have dissented, under Clause (b) of Sub-section (2) of Section 41, from the proposed acquisition of their land or from the proposed recovery of a betterment contribution, and a statement of the reasons given for such dissent; and
(g) a statement of the arrangements made or proposed by the Trust for the re-housing of persons likely to be displaced by the execution of the scheme, for whose re-housing provision is required.
(4) When any application has been submitted to the State Government under Sub-section (1), the Trust shall cause notice of the fact to be published for two consecutive weeks in the Official Gazette and in a local newspaper or newspapers, if any :
Provided that the provisions of Sub-section (2) of Section 44 regarding publication under Section 89 shall apply to modifications made by the Trust under Sub-section (1).
18. It is in pursuance of the requirement of this section that the Improvement Trust in these cases had sent the communication dated February 17, 1964. On receipt of communication under Section 43, the State Government is empowered under Section 44(1) either to sanction the scheme with or without modifications or the State Government may refuse to sanction or may return the scheme for reconsideration of the Trust. When the scheme is sanctioned by the State Government, the fact is to be announced by a notification and in certain circumstances the Improvement Trust is required to proceed to execute the same. Powers are given to the Trust to suggest alterations in a scheme under certain circumstances in Section 46. There are certain duties cast on the Trust according to the provisions of Chapter V where a scheme has been sanctioned. Under Section 48 whenever any building, street, square or other land or any part thereof which is vested in the Corporation is required for executing any improvement scheme, the Trust has to give notice according to the provisions to the Corporation that such building, street, square etc. should vest in the Trust and thereupon it vests in the Trust, Similar provision is made in respect of private street or square in Section 49. Section 55 empowers the Chairman, with or without assistants or workmen to enter upon any land to make inspection, survey, measurement, valuation or enquiry, or to take levels, to dig or bore into the sub-soil, to set out boundaries and intended lines of work, to mark such levels, boundaries and lines by marks and cutting trendies or to do any other thing, whenever it is necessary to do so for any of the purposes of this Act or. rules or regulations made under this Act. Corresponding to the power of vesting of Corporation properties such as streets etc. in the Trust, there is a corresponding provision in Section 57 that whenever the Trust is satisfied that any street laid out or altered by the Trust has been duly levelled etc., the Trust may call upon the Corporation by a notice in writing to take over the management of such street within a period specified in the notice and the Corporation is obliged to treat thereafter that street as vesting in it.
19. Chapter VI is a material provision for the purposes of these petitions. It is headed as 'Acquisition and Disposal of Land'. Under Section 58 in .this Chapter the Improvement Trust is empowered to enter into an agreement with any person for the acquisition by purchase, lease or exchange by the Trust from such person of any land within the area comprised in. a sanctioned scheme. Thus under this section land can be acquired by private treaty either on lease or on ownership. When the land is required to be acquired by compulsory process!, Section 59 makes provision therefor in the following terms:
The Trust may, with the previous sanction of the State Government, acquire land under the provisions of the Land Acquisition Act, 1894, as modified by the provisions of this : Act, for carrying out any of the purposes of this Act.
Much debate has turned on the exact construction of this provision of the Act and we shall have occasion to refer to it in proper context later on.
20. A Tribunal of a President and two assessors is constituted under Section 62 of the Improvement Trust Act for the purposes of performing the functions of the Court to which under the provisions of the Land Acquisition Act a reference can be made. Section 61 is important and is as follows: '
For the purpose of acquiring land under the Land Acquisition Act, 1894, for the Trust,--
(a) the Tribunal shall except for the purposes of Section 54 of that Act, be deemed to be the 'Court and the President of the Tribunal shall be deemed to be the Judge thereunder;
(b) the Act shall be subject to the further modifications as indicated in the Schedule ;
(c) the President of the Tribunal may summon witnesses and enforce their attendance and may compel the production of documents, by the same means, and so far as may be, ill the same manner, as is provided in case of a Civil Court under the Code of Civil Procedure, j.908; and,
(d) the award of the Tribunal shall be deemed to be the award of the Court under the Land Acquisition Act, 1894, and shall be final.
21. It will be seen that it is by virtue of this provision an the Improvident Trust Act that certain provisions of the Principal Act, namely, the Land Acquisition Act, 1894, are to be treated as amended to that extent as provided ill the Schedule. The amendments which are required to be made in the provisions of the Land Acquisition Act are given in different paragraphs of this Schedule, which forms part of the Improvement Trust Act. Under para. 1, definition of "local authority" 'is given by adding Clause (ee) to Section 3 of the. Principal Act. In that definition, the expression "local authority" includes the Trust constituted under the Nagpur Improvement Trust Act, 1936.
22. The amendments made in the provisions of the Land Acquisition Act, 1894, are by two1 methods. In some cases., there is an express provision for substituting certain provisions or words or expressions in the principal Act and in some other paragraphs provision is made for giving effect to the actions taken under the Improvement Trust Act, as if they are tantamount to and have the effect of actions taken under the Land Acquisition Act.
23. Thus, under para, 2 of the Schedule, the first publication of a notice of an improvement scheme under Section 39 of the Improvement Trust Act, shall be substituted for, and have the same effect as publication in the Official Gazette and in the locality of a notification under Sub-section (1) of Section 4, but there is an important exception subject to which this effect can be said to take effect and that exception is that such an effect shall not take place where a declaration under Section 4 or 6 of the Land Acquisition Act, 1894, has previously been made and is still in force. In other words, if in a given case in, respect of any property the State Government or the prescribed authority in exercise of its. powers under Section 4 or Section 6 of the Land Acquisition Act, 1894, has issued a notification or made a declaration, then in respect of such property the Nagpur Improvement Trust is precluded from "issuing a notice under Section 39 so long as the notification under Section 4 or Section 6 is in force.
24. Similarly, in. the case of land acquired under Sub-section (4) of Section 32 or in the case of other publication of a notification under Section 45 of the Improvement Trust Act, it has the same effect as if it is a declaration by the State Government under Section 6 of the Land Acquisition Act, 1894, unless, again a substantive declaration under Section 6 of the Land Acquisition has previously been made and is in force.
25. Then under para. 6, a new Section 17-A is added to the principal Act, that is, the Land Acquisition Act, 1894. This Section 17-A is as follows:
In every case referred to in Section 16 or Section 17, the Collector shall, upon payment of the cost of acquisition, make over charge of the land to the Trust and the land shall thereupon vest in the Trust, subject to the liability of the Trust to pay any further costs which may be incurred on account of its acquisition.
Corresponding changes are also made in clause first and sixthly of Sub-section (1) of Section 23 wherever reference is to the notification under Section 4(1) or declaration under Section 6 of the Land Acquisition Act, 1894. In sub-para (2) of para. 10, one of the provisions impugned, namely, a proviso to Sub-section (2) of Section 23 is added. We have already reproduced that proviso earlier. Similarly, by sub-para. (3) of para. 10 of the Schedule, addition of Sub-section (3) to Section 23, and particularly Clause (a),.has been made, which is one of the impugned provisions in these petitions.
26. These are the principal amendments made in the Land Acquisition Act in so far as the provisions of these Acts are applicable when acquisition is made for Improvement Trust.
27. The contention of the petitioners in these cases is that even though the land is being acquired for the benefit of the Nagpur Improvement Trust and in furtherance of a scheme framed by the Improvement Trust, the acquisition is by the State Government, but in making such acquisition the provisions of the Land Acquisition Act, 1894, as modified by the provisions of the Improvement Trust Act, are made applicable and the impugned provisions deprive the petitioners of their property without proper compensation and in doing so, they are discriminated against when compared to other citizens whose lands may be similarly acquired by the State Government under the substantive provisions of the principal Act, namely, the Land Acquisition Act, 1894. Citizens like the petitioners; and the properties like those of the petitioners in these cases, though similarly situated are subjected to a hostile discrimination and treatment inasmuch as even though the property is being acquired by the State for a public purpose, merely because the acquisition is for the Nagpur Improvement Trust under the provisions of the Improvement Trust Act, they are deprived of the benefit of the provisions of Sub-section (2) of Section 23 or Clause (a) of Section 23 which permits calculation of the market value on the basis not only of its actual viser, but also of its potential user and also deprives the petitioners of the solatium of fifteen per cent, for compulsory acquisition of their property.
28. The respondents resisted this claim pointing out, firstly, that the acquisition is not by the same authority. According to the learned Counsel for the State and the Trust, the acquisition is by the Trust and not by the State Government. This is the first point of distinction, drawn. It is next contended that the object for which acquisition of property is being made under the provisions of the Improvement Trust Act, as affecting the provisions of the Land Acquisition Act is for the specific purpose of improvement of town and .its orderly development, The acquisition for such a purpose, under these circumstances, therefore, is a class by itself and this classification is closely related to the object for which the acquisition is made, namely, providing housing scheme for people who need accommodation and is, therefore, distinguishable on this ground from other types of acquisitions under the Land Acquisition Act even though such acquisitions may be for a public purpose. "We have to decide which of the competing arguments are acceptable in view of the provisions of the law under which the action is being taken and their impact on the rights of the citizens.
29. The first question we have to decide is whether the acquisition in the instant cases can be said to be an acquisition by the Nagpur Improvement Trust or acquisition by the State Government. Reliance is placed on the wording of Section 33 of the Improvement Trust Act in support of the contention that the land is being acquired not only for the Trust, but by the Trust and if the acquiring authority is the Nagpur Improvement Trust, that is a distinguishing feature which must be taken cognizance of in appreciating the challenge on the ground of discrimination. It is not disputed that barring the express amendments made in the Land Acquisition Act, as provided under Section 61 and the Schedule to the Improvement Trust Act, all other substantive provisions of the Laud Acquisition Act are in force and have to be obeyed when property is being acquired for a scheme as framed by the Improvement Trust. Thus, even though the need for issuing a notification under Section 4(1) Or making a declaration under Section 6 of the Land Acquisition Act is dispensed with and is substituted by a notice under Section 39 and the notification of the accord of sanction under Sections 44 and 45 of the Improvement Trust Act respectively, it appears to us that once a sanction is accorded and notified under Section 45 of the Improvement Trust Act, further provisions of the Land Acquisition Act from Section 7 onwards have to be complied with and are in fact, relied upon and acted upon in such acquisition proceedings. We have already pointed out that the letter written by the Improvement Trust dated February 17, 1964 making an application to the State Government under Section 43 of the Improvement Trust Act, in terms requests the State Government to direct the Collector to take action for the acquisition of the properties. Such a direction, in our opinion, would be inapposite and redundant, if the acquiring authority were to be the Trust and not the State Government. The endorsement in the order-sheet of the Land Acquisition Officer, who is clothed with the powers of the Collector under the Land Acquisition Act filed! in these cases also would show that that officer understood that he was exercising the powers of acquisition on behalf of the State Government and not on behalf of the Trust, though the acquisition may be for the benefit of the Trust and in furtherance of the scheme framed by it. After the proceedings are initiated by the Collector on receipt of the directions from the State Government, the Collector has to issue a public notice under Section 9 of the Land Acquisition Act. Order-sheet dated July 28, 1966, on the record of the file of the Land Acquisition Officer, shows that such a notice was ordered to be issued on that date under Section 9 of the Land Acquisition Act. After noticing the parties, enquiry has to be made for determination of compensation and an award is required to be passed under Section 11 of the Land Acquisition Act, 1894. Such an award was passed in these cases on or about June 12, 1967. Under Section 12 of the Land Acquisition Act after the award is passed, the Collector has to give a notice of such award which has been done by the Land Acquisition Officer on the same date. It is significant to note the direction given by the Land Acquisition Officer in these cases when notices were ordered to be issued for delivery of possession on June 16, 1967, a memo was issued to the Trust directing the Trust to deposit compensation amount. The next step is the most important and, that is, taking of possession for which power is vested under Section 16 of the Land Acquisition Act in the Collector. According to Section 16 of the Land Acquisition Act, when the Collector has made an award tinder Section 11, he may take possession of the land, which shall thereupon vest absolutely in the Government free from all encumbrances. The legal consequence of taking possession of the land after passing of the award by the Collector is that the possession of the property vests in the State Government, free from all encumbrances. This Section 16 of the Land Acquisition Act is preserved intact. Then follows Section 17-A. which we have reproduced above added by para, 6 of the Schedule to the Improvement Trust Act and under this newly added Section 17-A of the Land Acquisition Act, in every case referred to in Section 16 or Section 17, the Collector is enjoined to make over charge of the land to the Trust on payment of the cost of acquisition and thereupon the land is to vest in the Trust, subject to any liability of the Trust to pay any further costs which may be incurred on account of its acquisition. Thus, the Trust acquires title to the property and that the property vests in the Trust from the State Government and only on payment of the cost of acquisition and not till then. In face of these provisions, we are unable to see how it could be contended that under the scheme of the Improvement Trust Act, the acquiring authority is the Trust and not the State Government, There is hardly any room for such a contention in view of the clear and express provisions made in the Act as to the authority in whom the property vests in the first instance, namely, the State Government, and that property shall thereafter vest in the Trust from the State Government after payment of the amount of cost of such acquisition.
30. It was urged that the agency of the State Government as an intermediate authority in which the property vests, may be only a matter of convenience, but the acquisition of property being primarily intended for the Improvement Trust and property being ultimately vested in the Trust by reason of Section 17-A it should be held that the acquirer of property is really the Improvement Trust and not the State Government. In this connection, it was also urged that this provision should be contrasted with the provision made for transfer of property when property is acquired for a company under Sections 40 and 41 of the Land Acquisition Act. Under Section 41 of the Land Acquisition Act, it is only after an agreement is entered into by the Company with the appropriate Government providing, among other things, for the transfer on necessary payment of land to the company, that the proceedings for acquisition are taken in hand. In our opinion, there is a close parallel in some respects when acquisition is to be made on behalf of the Trust and on the other hand on behalf of the Company, at least in two matters. Under Section 38(1) of the Land Acquisition Act, the appropriate Government can authorise any officer of the Company desiring to acquire land for its purposes to exercise the powers conferred by Section 4, namely, issuing of a notification that certain land is intended to be acquired. Just as the Improvement Trust is empowered to issue a notice under Section 39(1) of the Improvement Trust Act, which has the effect of a notification under Section 4(1) of the Land Acquisition Act, somewhat analogous powers can be conferred on an officer of the Company which desires to acquire land under the provisions of the Land Acquisition Act through the agency of the State Government. It is also pointed out that there is no provision in Section 50 of the Land Acquisition Act, which makes it possible for the State Government to acquire land at the cost of any fund controlled or managed by a local authority to hand over possession of the land after the transfer of title to the land to the local authority, as there is in the case of the Improvement Trust under Section 17-A or under Section 41 of the Land Acquisition Act in the case of a Company. In our opinion, the reason for omission of such power is of no effect, the usual provision being made in all Local Government Acts for the State Government to vest properties in the local authorities under the provisions of those Acts. Express provisions seem to have been necessary in the case of the Improvement Trust and the Company because1 special provision has been made for the acquisition of land for the purposes of a Company under certain circumstances and special provision has been made for acquisition of land for the benefit of the schemes framed by the Improvement Trust under the amended provisions of the Land Acquisition Act, as in these cases. The question, therefore, was whether' merely because no special provision has been made in the Land Acquisition Act for transferring land acquired for local bodies under any specific provisions of the Land Acquisition Act, that on that account a different construction should follow as to the legal consequences of action taken for acquiring land for the Improvement Trust under the provisions of the Land Acquisition Act; It appears to us that so far as the acquiring authority is concerned, it is always the State Government and even though the land is being acquired for the benefit of a scheme prepared., notified by the Improvement Trust and sanctioned by the Government, certain preliminary steps in connection with such acquisition are entrusted to the Improvement Trust by the provisions of Sections 39 and 44 of the Improvement Trust Act.
31. The next contention that has to be considered is whether the State Government which is acquiring property for public purposes can be empowered without offending the Article 14 of the Constitution to exercise the choice of acquiring property under different provisions of the Land Acquisition Act, according as the property is acquired for the benefit of the Nagpur Improvement Trust or the property is acquired for any other public purpose, for which land or property can certainly be acquired by the State Government. The justification for such differentia in the treatment is ascribed by the learned Counsel for the State to the purpose to which the land is being acquired and tise to which it may be put.
32. In this connection, reliance was placed on a decision of the Allahabad High Court in, S. Kumar v. Bamras Improvement Trust  A.I.R. All. 513. The land in that case was acquired under the provisions of the U.P. Town Improvement Act, 1919, as would appear from the judgment in this case. The Banaras Improvement Trust was authorised to frame improvement schemes to provide for a number of matters, including schemes known as "street schemes" for the purpose of improving existing means of communication and facilities of traffic. Under Section 56 of the Town Improvement Act, applicable to Banaras, the Trust was empowered subject to the previous sanction of the State Government to acquire land under the provisions of the Land Acquisition Act, 1894, as modified by the Town Improvement Act, a provision analogous to Section 59 of the Nagpur Improvement Trust Act. As in the Nagpur Improvement Trust Act, the Town Improvement Act in that case, made certain modifications in the principal Act, that is, the Land Acquisition.- Act, 1894, and one of the important modifications was similar to the one made by the Nagpur Improvement Trust Act in the matter of determination of market value being arrived at according to the use to which the land was put at the date with reference to which the market value is to be determined. The view taken in that case is that the acquiring authority under the Town Improvement Act is the Improvement Trust, whereas the acquiring authority under the Land Acquisition Act is the State Government and inasmuch as the acquiring authorities are different, the different modes of arriving at the market value could not be challenged on the ground of discrimination. We are not in a position to find out from the brief facts given in the judgment the full extent to which the provisions of the Land Acquisition Act stood amended on account of the modifications made in it by the provisions of the Town Improvement Act, applicable to Banaras; but so far as the provisions of the Nagpur Improvement Trust Act are concerned, it is clear, as we have already indicated, that the acquiring authority is the State Government and not the Improvement Trust. It in not necessary in this case, therefore, to decide the question whether the different basis of valuations will be permissible when land is acquired for a public purpose under the process of compulsory purchase when the acquiring authorities arc different. So far as these petitions are concerned, it is obvious that it is the State Government which is the acquiring authority even under the Improvement Trust Act, just as it is that authority under the principal Act, namely, the Land Acquisition Act, 1894.
33. In this connection, our attention was invited to a decision of the Nagpur High Court reported in Central India Spinning Weaving and Manufacturing Co. v. Provincial Government  N.L.J. 183, s.c.  A.I.R. Nag. 129 and in particular, to the observations at page 188:
The limitation, however, against Government is governed by Article 120 of the Limitation Schedule and is six years, and the question is whether the suit is out of time against Government for the reason that it is out of time against the Trust. We consider that the first defendant could be sued without claiming any relief against the Trust and that the Trust was a proper party rather than a necessary party to the suit. Section 50 of the Land Acquisition Act deals with the acquisition of land at the cost of a local authority, and the Nagpur Improvement Trust is by amendment of Section 3 included in a definition of the words "local authority". Under Section 50, Sub-section (2), the local authority may appear before the Collector and give evidence. Under Section 48 of the Act the Government is at liberty to withdraw from the acquisition before possession is taken, and on acquisition the land vests in the Collector under Section 16 of the Act when the Collector takes possession. Under Section 17-A of the amended Act the Collector on payment of the cost of acquisition makes over charge of the land to the Trust. In Radha Nath Malty v. Krishna Chandra  A.I.R. Cal. 249 it was held that the acquisition of land by the Calcutta Improvement Trust under the Calcutta Improvement Act amounted to an acquisition made by Government. Section 18, and a similar section to Section 17-A were considered, and it was said: 'Having regard to the clear principles of Section 16, Land Acquisition Act, which has been made applicable to the acquisition for the expansion and improvement of Calcutta, we have no doubt that this is an acquisition by Government.' The question for decision was whether a clause in a kabuliyat to the effect that a tenant would not be entitled to compensation in the case of acquisition of land by Government applied or did not apply. We consider that the plaintiff could have sued Government alone for a declaration that the land acquisition proceedings were illegal in view of the alleged illegality of the actions of the Trust which resulted in the proceedings, and we find ourselves unable to say that the suit must be dismissed against Government for the reason that as against the Trust a suit for declaration must fail.
34. With respect, we have no hesitation in agreeing with the interpretation of the provisions of the Land Acquisition Act, as amended by the provisions of the Improvement Trust Act and the effect thereof. It must, therefore, be held that the acquiring authority is the Government and not the Nagpur Improvement Trust.
35. The learned Counsel for the respondents also defended the difference in principle of valuation for the purposes of determination of the market value on the ground that the purpose for which the property was acquired is specific and when property is being acquired for town planning, it is for the larger benefit of the residents of the area in which the town planning or an improvement scheme is in operation. That itself would be a distinguishing feature justifying a separate treatment to this category of acquisition as a distinct class. In this connection, our attention was invited to a decision of the Supreme Court in Maneklal Chhotalal v. M. G. Makwana  A.I.R. S.C. 1373. The impugned Act in that case was the Bombay Town Planning Act, 1954, as amended by Gujarat Act No. 52 of 1963. We are not satisfied that the principle of that decision can be usefully called in aid by the respondents in these cases for solution of the question with which we are faced. In Maneklal's case, the competency of the State Legislature to pass the Act in exercise of any of its powers in the State Legislative List was challenged. After examining the provisions of the impugned Act in paras. 22, 23 and 32 the Court referred in para, 42 to the scope in Principles of Town, and Country Planning by Lewis Keepl and upheld the competence of the State Legislature to make a law like the Bombay Town Planning Act as fully covered not only by the Entry No. 18 of List II, but also by Entry No. 20 of List III, which speaks of economic and social planning. It appears that during the challenge to certain provisions of the Constitution, it was contended that the provisions of the Act offended Article 19(I)(f) of the 'Constitution and that challenge was also repelled in view of the safeguards provided in various provisions of that Act.
36. The next case relied upon is Dalchand v. Delhi Improvement Trust  A.I.R. S.C. 87 but it does not appear that in this case any challenge based on the fundamental right under Article 14 was raised on behalf of the appellant Dalchand. As the specific question which is required to be decided in the present petitions was not raised in this case, it is difficult to hold that by upholding the provisions of the Act, the issue raised before us should be held to be decided by implication.
37. Our attention was also invited to a recent decision of the Supreme Court in K.L. Gupta v. Municipal Corporation (1907) 70 Bom. L.R. 337 : s.c.  A.I.R. S.C. 303. In this case, certain provisions of the Bombay Town Planning Act, being Bombay Act No. 27 of 1955 were challenged as violative of the guarantee under Articles 14,. 19 and 31 of the Constitution. It appears from the observations in para, 6 of that judgment at page 341 that the substantial complaint was that the lands of the petitioners having been car-marked for one purpose at an earlier date, their re-designation and reservation for another purpose at a later date was without any opportunity being given to the petitioners when the change was made and this re-designation was challenged as without any authority of law and violative of the rights of the petitioners under Articles 14 and 19 of the Constitution. Reliance is placed on the observations in para. 9 of the judgment to the following effect (p. 341) ;
...it is necessary to take stock of the position at the time of its enactment so that attention may be focussed on the situation calling for a remedy and how the Legislature sought to tackle it. It is common knowledge that for a number of years past, all over India, there has been and is continuing a great influx of people from the villages to towns and cities for the purpose of residence and employment. Besides this, the whole of the country is in the grip of a population explosion. Another circumstance to be reckoned with is that industrial development is taking place in and round about many cities which in its turn is attracting people from outside. Most of our towns and cities have grown up without any planning -with the result that public amenities therein arc now being found to be wholly inadequate for the already enlarged and still expanding population. The roads are tomorrow for modern vehicular traffic. The drainage system, such as it obtains in most of the towns and cities, is hopelessly inadequate to cope with the requirements of an already overgrown population. In most of the towns and cities there is no room for expansion of public amenities like hospitals, schools, colleges and libraries or parks. Some improvement has been sought to be made by Town Improvement Acts enacted in the different States. In order that the suburbs! and the surroundings of towns and cities be developed properly and not allowed to grow haphazard, the Legislature of Bombay felt that towns should be allowed to grow only on planned schemes formulated on the basis of a development plan.
38. There is no doubt that the underlying idea of a legislation undertaken with this object, such as Town Planning Act or Town Improvement Act, must result in encroachment of rights in property comprising within the area covered by such schemes under the Act. In the case of K. L. Gupta v. Municipal Corporation, the attack seems to be primarily on the power vesting in certain authorities to designate lands as reserved for one purpose or the other. As far as we are able to find, there was no challenge to the provisions of the Act regarding the basis of determination of the market value which was to be determined. We, therefore, do not see how even this decision is of much. assistance to the learned Counsel for the respondents in finding an answer to the issue which is posed in these cases.
39. On the other hand, it is pointed out that the over-all power of the State Government to acquire land or property for improvement, of towns is not in any way restricted even, where such a power may he given to an. Improvement Trust. In Patna Improvement Trust v. Lakshmi Devi  A.I.R. S.C. 1077 the relative powers of the State Government under the Land Acquisition Act after the passing of the Bihar Town Planning and Improvement Trust Act (Act No. 35 of 1951) called Patna Improvement Trust Act, came in for examination. The Patna High Court took the view that in view of the special provisions for acquisition of land for Improvement Trust provided for in Patna Improvement Trust Act, the general power of the State Government under the Land Acquisition Act must he deemed to be curtailed to that extent. This interpretation was not accepted by the Supreme Court. In para. 5, their Lordships have observed as follows:
It is not necessary to go into the argument of inconsistency between the Bihar Act and the Land Acquisition Act or the special Act excluding the general because it appears to us that the various provisions of the Bihar Act themselves afford the key to the solution of the problem before us which is one of construction. Section 71 of the Bihar Act which modifies the Land Acquisition Act, itself states that for the purpose of acquisition of land for the Trust under the Land Acquisition Act that Act (Land Acquisition Act) shall be subject to the modification specified in the Schedule. Therefore even for the purpose of acquiring land for the Trust the machinery of the Land Acquisition Act as modified is contemplated. It does not exclude the Land Acquisition Act, on the contrary it makes it applicable but subject to its modifications and exceptions.
If we may say so with respect, in these cases precisely the same considerations must be applied in interpreting the provisions of the Improvement Trust Act in so far as it purports to modify the provisions of the Land Acquisition Act for the purpose of acquiring laud for any scheme of the Improvement Trust.
40. Whenever a challenge is made on the basis1 of discrimination under Article 14 of the Constitution, it is now well-settled that the impugned Act has to satisfy two tests, namely (1) that the classification must be founded on intelligible differentia which distinguishes persons and things left out of the group and (2) the differentia must have a rational relation to the object sought to be achieved by the statute in question. As observed by Subba Rao J., as he then was, in Vajravelu v. Sp. Dy. Collector  A.I.R. S.C. 1017, at p. 1027, to ascertain whether the impugned Act satisfies the said two tests, three questions have to be posed, namely, (1) what is the object of the. Act (2) what arc the differences between persons whose lands are acquired for the housing schemes and those whose lands are acquired for purposes other than housing schemes or between the lands1 so acquired? and (3) whether those differences have any reasonable relation to the said object?
41. In the instant cases, the petitioners' contention is that it is the State Government which is empowered to acquire, land for public purposes under the general provisions of the principal Act, that is, the Land Acquisition Act and after a notification under Section 4 is issued by the State Government, the owner of the property gets compensation as provided in Section 23 of the Act; whereas the same acquiring authority, namely, the State Government, is empowered by virtue of the provisions of the Improvement Trust Act, amending for that purpose the provisions of the Laud Acquisition Act when land is acquired for the purpose of a scheme framed by the Improvement Trust for value, which is artificially determined by the amended provisions of Section 23. Now what is the object of this legislation, namely, the legislation under which the property is being acquired. The object is to acquire the property of the citizens for public purpose. In our opinion, it is not possible to accede to the contention of the learned Counsel for the Stale, that the object of the two Acts is in one case acquisition of property for a scheme framed by the Improvement Trust and in the other case the object is acquisition of property for some other public purpose. The object is acquisition, though the purposes for which the property is acquired may be different in the two cases though both are for public purpose. Is it possible for the petitioners to say that in similar circumstances, same or similar properties are capable of being acquired by the State with different and discriminatory consequences as to the amount of compensation and the basis on which it is to be determined? In the City of Nagpur it is quite conceivable that the State Government can acquire property under the substantive provisions of the principal Act, namely, the Land Acquisition Act, 1894, for a public purpose and in that case, the compensation will be determined under the normal provisions of Section 23 of the Land Acquisition Act. That public purpose may in its turn itself include a housing scheme or a settlement for providing houses for citizens, class of employees or evicted persons, all of which will be included in the public purpose for which the property can be acquired; but if the same purpose is to be achieved by framing a scheme through the Improvement Trust, then the State Government is enabled to acquire property and to pay for it by way of compensation determined on a different basis, which has no relation to the object, namely, the acquisition of the property.
42. Precisely this issue was under consideration in Vajravelu's case. The Madras Legislature had passed Land Acquisition (Madras Amendment) Act (No. 23 of 1961) amending certain provisions of the Land Acquisition Act, 1894. The Court observed that on a comparative study of the principal Act, that is, the Land Acquisition Act, 1894, and the Amending Act, it was shown that if the land is acquired for & housing scheme under the Amending Act, the claimant gets a lesser value than he would get for the same land or a similar land if it is acquired for a public purpose like hospital under the principal Act and the question is whether this classification between persons whose lands are acquired for housing schemes and persons whose lands are acquired for other public purposes has reasonable relation to the object sought to be .achieved. It was observed that the object of the Amending Act is to acquire lands for housing schemes. However, laudable the object of the Amending Act may be, it was so framed that under the provisions thereof any land, big or small, waste or fertile, owned by rich or poor, can be acquired on the ground that it is required for a housing scheme. Posing the question what the differences were between persons owning lands in the Madras City or between the lands acquired which have a reasonable relation to the said object, it was suggested that the suitability of the lands acquired for the said object suggested the basis of difference. The Court observed that the differences based upon the said criteria have no relevance to the object of the Amending Act. As to whether the purpose for which the property is sought to be acquired is public purpose, of a particular type has no relevance in determining the differentia in the classification; in this context the Court observed as follows (p. 1028) :
...It is said that the object of the Amending Act in itself may project the differences in the lands sought to be acquired under the two Acts. This argument puts the cart before the horse. It is one thing to say that the existing differences between persons and properties have n reasonable relation to the object sought to be achieved and it is totally a different thing to say that the object of the Act itself created the differences.
In other words, the differences, if any, have to be established on the existing state of things with respect either to persons or the properties which are being acquired and not with respect to the different use to which the property may be put after the process of acquisition is complete.
43. Even more apposite would appear to be the recent pronouncement of the Supreme Court in a case coming from Assam in Dy, Commr., Kamrup v. Thirganaili  A.I.R. S.C. 304. In that case, the. provisions of the Assam Acquisition of Land for Flood Control and Prevention of Erosion Act (Act No. 6 of 1955) were under challenge and the challenge was precisely on the ground that the Act violated the guarantee under Article 14 of the Constitution. Paragraph 18 of the judgment deserves to be quoted in extenso as it pin-points the answer to the contention raised on behalf of the respondents. Paragraph 18 is as under:
The next question is whether Act No. 6 of 1955 offends Article 14 of the Constitution. The Land Acquisition Act, 1894 is in force in the State of Assam and under it private property may be acquired for any public purposes on payment Of market value of the land at the date of the publication of the notification under S. 4(1). Section 17 of the Act makes special provision for the speedy acquisition of waste or arable land in cases of emergency. While that Act is in force in the State of Assam, the State Legislature passed Act No. 6 of 1955 providing for speedy acquisition of land for the public purpose of carrying out works or other development measures in connection with flood control or prevention of erosion on payment of compensation assessed on the basis of a multiple of the annual land revenue. The result is that in the State of Assam some land may be taken under Assam Act No. 6 of 1055 for the purpose of works and other measures in connection with flood control and prevention of erosion on payment, of nominal compensation while an adjoining land may be taken for other public purposes under the Land Acquisition Act on payment of adequate compensation. The question is whether this differential treatment of land acquired under the two Acts is permissible under Article 14. The constitutional guarantee of Article 14 requires that all persons shall be treated alike in like circumstances and conditions. The Article permits reasonable classification and differntial treatment based on substantial differences having, reasonable relation to the objects sought to be achieved. It is not possible to hold that the differential treatment of the lands acquired under the Land Acquisition Act, 1894 and those acquired under Assam Act No. 0 of 1955 has any reasonable relation to the object of acquisition by the State. In Vajravelu v. Sp, Dy, Collector the Court held that the Land Acquisition (Madras Amendment) Act, 1961 providing for the acquisition Of lands for housing schemes and laying down principles for fixing compensation different from those prescribed in the Land Acquisition Act was violative of Article 14. Discrimination between persons whose lands were acquired under housing schemes and those whose lands were acquired for other purposes could not be sustained under Article 14. Although it was contended that the amending Act was passed to meet an urgent demand to clear up slums, the Act as finally evolved was not confined to any such problem and land could be acquired under the amending Act for housing schemes and other objectives.... In our opinion, the classification of land required for works and other measures in connection with flood control and prevention of erosion and land required for other public purposes has no reasonable relation to the object sought to be achieved, viz., acquisition of the land by the State. In either case, the owner loses his land and in his place, the State becomes the owner. There is unjust discrimination between owners of land similarly situated by the mere accident of some land being required for purposes mentioned in Assam Act No. 6 of 1935 and some land being required for other purposes. We hold that Assam Act No. 6 of 1955 is violative of Article 14.
44. There was yet another challenge to the Assam Act, (Act No. 6 of 1955) and the force of which was accepted. It seems to have been contended before the Supreme Court that it was open to the State to acquire property in connection with flood control and prevention of erosion either under the Land Acquisition Act or under the Assam Act No. 6 of 1955 at its sweet-will. Thus, if same or similar lands could be acquired either under the provisions of one Act or the other, it necessarily created a situation where there was no guidance why in one case the owner of property should be paid less and in the other case the owner of property should be paid according to the relevant provisions for compensation under the Land Acquisition Act. In our opinion, these observations are also apposite in considering the contention in these cases. If the land is acquired for a scheme framed by the Improvement Trust after a notice under Section 39 followed by a notification of sanction under Section 44 of the Improvement Trust Act, the owner of property loses the same for a considerably less compensation, whereas if the same property is acquired under the provisions of the Land Acquisition Act, unamended by the Improvement Trust Act, the owner of the property will get compensation on the normal scale. "We have not been shown any justification for such differential treatment to the subject for acquisition of property for a public purpose by the State Government and why two -different consequences should follow in the matter of determination of compensation.
45. Similar views have been taken by the Andhra Pradesh High Court in Balaji Industries v. Land Acq. Collector  A.I.R. A.P. 141, in which Section 40-B of the Andhra Pradesh (Telangana Area) Housing' Board Act (46 of 1956) has been struck down following the decision of the Supreme-Court in Vajvaveln v. Sp. Dy. Collector .
46. Now remains' to consider one more decision relied upon by the learned Counsel for the State, namely, Ishwarlal v. State, of Gujarat  A.I.R. S.C. 870. It seems 'to have been contended that the powers vested in the State Government under Section 17(1) and 17(4) of the Land Acquisition Act, 1894, permitted a discriminatory treatment being- given to one kind of land owner as against another in the matter of taking urgently possession of property when possession was required to be taken and to that extent, the provisions being discriminatory, were hit by Article 14 of the Constitution. It does not appear that this matter was elaborately argued as it is disposed of in para. 26 of the judgment thus:
Finally there remains the question of the constitutionality of Sub-sections (1) and (4) of S. 17. On this point very little was said and it is sufficient to say that the High Court judgment under appeal adequately answers all objections.
47. We are thus left to consider how the matter was dealt with in the Gujarat High Court and that decision is Ishwarlal Girdharlal Joshi v. State of Gujarat  Gujarat 620 and the view that seems to have been taken is that the classification of land to be taken in possession on the basis of urgency of acquisition was a permissible classification not repugnant to the guarantee under Article 14 of the Constitution. It will be seen that what Section 17 provides is for conferral of special powers in cases of urgency. If the direction is given under Sub-section (1) of Section 17 by the appropriate Government or the Commissioner of the State, even though no award has been made, the Collector may on the expiration of fifteen days from the publication of the notice under Section 9,. take possession of any waste or arable land needed for public purposes. Under Sub-section (4) of Section 17, on the other hand, the provisions of Sub-section (1) are-made applicable in case the appropriate Government directs that Section 5-A shall not .apply and if it does so direct, a declaration under Section 6 in respect of any land may be made. The only difference in the treatment to the person whose property is being taken in possession is as to the point of time, but the view that has been taken is that, it is a permissible classification because in either case the right to compensation begins from the date of dispossession. Whether in case it is necessary to take immediate possession of the property has been left to the discretion of the appropriate authority and the deposit of such discretion does not lead to any undue discrimination. We do not think, the principle of this case can really be availed of when the substantial question is whether the property can be acquired by payment of compensation on entirely two different basis, merely because the acquisition in one case is for the purposes of the scheme, while in the other, it may be. either for similar schemes or for any other public purposes..
48. On a consideration of all circumstances, we have come to the conclusion that the acquisition is by the State in all, cases where the property is required to be acquired for the purposes of a scheme framed by the Trust and such being the position, it is not permissible without violating the guarantee under Article 14 of the Constitution for the State to acquire any property under the provisions of the Land Acquisition Act as amended by the Improvement Trust Act in so far as they relate to the basis of determination and payment of compensation. It must, therefore, be held that the' provisions of paras. 10(2) and 10(3) in so far as they add a new Clause (3)(a) to Section 23 and a proviso to Sub-section (2) of Section 23 of the Land Acquisition Act are ultra vires as violating the guarantee of Article 14 of the Constitution. We declare that the provisions of para. 10(2) and para, 10(8)(a) of the Schedule to the Improvement Trust Act are void and shall not be effective in determining the amount of compensation payable in respect of the property acquired for the Trust. The challenge was limited only to these two provisions and we have not considered any other provisions amending' the principal. Act.
49. The result is, the petitions are allowed. The award in each case passed by the Land Acquisition Officer is set aside and the matter is remanded to that Officer for determination of compensation according to law in the light of the decision given above. As the petitions succeed, the petitioners will be entitled to costs from be respondents-Trust. Leave to file appeal to the Supreme Court is granted under Article 132(1) and Article 133(1)(c) of the Constitution. The Land Acquisition Officer will permit the parties to lead evidence to enable him to determine the compensation according to law.