PRINCIPAL COMMISSIONER OF INCOME TAX vs. M/S TIMBER CRAFT and VENEER PROUDCTS INDIA PVT LTD

WA 154/2017 BEFORE HON’BLE MR. JUSTICE UJJAL BHUYAN HON’BLE MR. JUSTICE PARAN KUMAR PHUKAN (U. Bhuyan, J) Heard Mr. N. Dutta, learned senior counsel assisted by Mr. J. I. Borbhui ya, learned counsel for the appellants and Mr. A. Ganguly, learned counsel for r espondent Nos.1 to 6. This appeal is directed against the order dated 15.05.2017, passed by the learne d Single Judge in WP(C) No.2779/2017 preferred by respondent Nos. 1 to 6 as writ petitioners challenging the legality and validity of the order dated 07.03.2017 , passed by the Additional Deputy Commissioner, Sivasagar in Misc Case No.26/201 6 rejecting the objection filed by respondent Nos.1 to 6 to the claim of the app ellants for compensation on account of acquisition of land. Matter relates to payment of compensation on account of acquisition of l and for construction of National Highway by the National Highway Infrastructure Development Corporation Limited. It appears that an area of land measuring 2 kathas 15 lechas of Dag No. 139 and 2 Bighas 2 Kathas of Dag No. 158 of Ejmali Patta No.68 (38) of village L efera Choudang, under Mouza Mora Bazar of Amguri Revenue Circle in the district of Sivasagar was acquired for construction of 4 lane National Highway. Responden t Nos. 1 to 6 filed objection petition to the claim of appellants as sole benefi ciaries for compensation on account of acquisition of such land. The said object ion was registered as Misc. Case No. 26/2016. Additional Deputy Commissioner, Si vasagar vide order dated 07.03.2017 rejected the said objection. Respondent Nos. 1 to 6 thereafter filed the related writ petition assail ing the legality and validity of the aforesaid order dated 07.03.2017, which was registered as WP(C) No. 2779/2017. In the said writ petition appellants have be en arrayed as respondent Nos. 5 and 6. Learned Single Judge vide order dated 15.05.2017 had issued notice and p assed an interim order staying the aforesaid order dated 07.03.2017. It was furt her directed that the amount of compensation if disbursed to the appellants shou ld be kept apart by the appellants in a separate account under the control of th e Deputy Commissioner, Sivasagar till the disposal of the writ petition. An obse rvation was made that the writ petition would be disposed of on the returnable d ate to examine the question as to whether the matter can be remanded back to the Deputy Commissioner, Sivasagar for a proper adjudication as per law. Aggrieved, present appeal has been filed. Mr. Dutta, learned senior counsel for the appellants has referred to the provisions of the National Highways Act, 1956, including Sections 3G and 3H the reof. He submits that as per sub-Section (3) of Section 3H, when there are sever al persons claiming interest in the compensation, the competent authority shall determine the persons who in its opinion are entitled to receive the amount of c ompensation payable to each of them. As per sub-Section (4), if any dispute aris es as to apportionment of the amount or any part thereof or to any person to who m the compensation or any part thereof is payable, the competent authority shall refer the dispute to the Principal Civil Court of original jurisdiction within the limits of whose jurisdiction the land is situated. He submits that National Highways Act, 1956 lays down a complete code regarding payment of compensation a nd apportionment of the same with adequate provision of remedy to an aggrieved p erson. Therefore, when such adequate and efficacious alternative remedy is avail able, writ petition is not maintainable. Learned Single Judge committed manifest error in entertaining the writ petition and passing the order impugned in the a ppeal. In support of his submission, he has placed reliance on the decision of t he Supreme Court in the case of Commissioner of Income Tax vs Chhabil Dass Agarw al, (2014) 1 SCC 603. On the other hand, Mr. Ganguly, learned counsel for respondent Nos. 1 to 6 submits that if the interim order is stayed or vacated, the compensation awar ded illegally to the appellants would be appropriated leaving respondent Nos. 1

to 6 without any compensation. Therefore, either writ petition should be kept pe nding to decide the point of maintainability or in the event it is held that the writ petition is not maintainable, interim direction as given by the learned Si ngle Judge should be maintained as otherwise legitimate claim of respondent Nos. 1 to 6 would be defeated. Submissions made by learned counsel for the parties have received the du e consideration of the court. It is not in dispute that subject matter of the related writ petition is legality and validity of the order dated 07.03.2017, passed by the Additional D eputy Commissioner, Sivasagar in connection with payment of compensation in resp ect of land acquired for construction of National Highway. In so far declaration of certain highways as National Highways and for m atters connected therewith including acquisition of land and payment of compensa tion, the relevant legislation is the National Highways Act, 1956. Section 3(a) of the National Highways Act, 1956 (1956 Act) defines competent authority  to m ean any person or authority authorised by the Central Government, by notificatio n in the Official Gazette, to perform the functions of the competent authority f or such area as may be specified in the notification. Section 3 A to 3 J was inserted in the 1956 Act by an amendment brought in 1997 with effect from 24.01.1997. Section 3G lays down the manner in which co mpensation payable to the persons interested in the land is to be determined by the competent authority. After such determination is made, Section 3H comes int o play. As per sub-Section (1), the amount determined under Section 3G shall be deposited by the Central Government with the competent authority in the manner p rescribed before taking possession of the land. As per sub-Section (2), as soon as such amount is deposited by the Central Government, the competent authority s hall pay the same to the person or persons entitled thereto. When several person s are claimants to compensation, sub-Section (3) provides that competent author ity shall determine the persons who in its opinion are entitled to receive the a mount payable to each of them and under sub-Section (4) if any dispute arises as to the apportionment of the amount or any part thereof or entitlement of any pe rson to receive compensation or any part thereof, the competent authority shall refer the dispute to the decision of the Principal Civil Court of original juris diction within the limits of whose jurisdiction the land is situated. A conjoint reading of sub-Sections (3) and (4) of Section 3H of the 195 6 Act would indicate that if there are several claimants to compensation, the co mpetent authority shall determine the persons who are entitled to receive compen sation as well as the amount of compensation to be received by each of them. If after such determination, a dispute arises as to the apportionment or to any per son awarded compensation, the competent authority shall refer the dispute for de cision of the Principal Civil Court of original jurisdiction within the limits o f whose jurisdiction the land is situated. In other words, the dispute has to be raised before the competent authority and once such dispute is raised, the comp etent authority shall refer the same to the Principal Civil Court. This is in sum and substance the scheme of Section 3H of the 1956 Act wh ich is somewhat akin to the provision of Section 18 of the Land Acquisition Act, 1894. In any view of the matter, this Section provides an adequate and efficaci ous statutory remedy to a dissatisfied person who disputes the apportionment of compensation or grant of compensation to any person. When such an adequate and e fficacious alternative remedy is available, being provided under the statute, or dinarily a writ court would not interfere with an order passed by the competent authority under sub-Section (3) thereby pre-empting a decision under sub-Section (4), which is otherwise statutorily ordained. This well recognized principle of non-exhaustion of alternative remedy o r refusal to invoke the extra-ordinary jurisdiction under Article 226 of the Con stitution of India in the face of availability of effective alternatively remedy has been restated by the Supreme Court in the case of Chhabil Dass Agarwal (sup ra), relevant portion of which is extracted hereunder:--- 11. Before discussing the fact proposition, we would notice the principle of la w as laid down by this Court. It is settled law that non-entertainment of petiti

ons under writ jurisdiction by the High Court when an efficacious alternative re medy is available is a rule of self-imposed limitation. It is essentially a rule of policy, convenience and discretion rather than a rule of law. Undoubtedly, i t is within the discretion of the High Court to grant relief under Article 226 despite the existence of an alternative remedy. However, the High Court must not interfere if there is an adequate efficacious alternative remedy available to t he petitioner and he has approached the High Court without availing the same unl ess he has made out an exceptional case warranting such interference or there ex ist sufficient grounds to invoke the extraordinary jurisdiction under Article 22 6. (See: State of U.P. vs. Mohammad Nooh , AIR 1958 SC 86; Titaghur Paper Mills Co. Ltd. vs. State of Orissa , (1983) 2 SCC 433; Harbanslal Sahnia vs. Indian O il Corpn. Ltd ., (2003) 2 SCC 107; State of H.P. vs. Gujarat Ambuja Cement Ltd . , (2005) 6 SCC 499). 12. The Constitution Benches of this Court in K.S. Rashid and Sons vs. Income Ta x Investigation Commission , AIR 1954 SC 207; Sangram Singh vs. Election Tribuna l, Kotah , AIR 1955 SC 425; Union of India vs. T.R. Varma , AIR 1957 SC 882; Sta te of U.P. vs. Mohd. Nooh , AIR 1958 SC 86 and K.S. Venkataraman and Co. (P) Ltd . vs. State of Madras , AIR 1966 SC 1089 have held that though Article 226 conf ers a very wide powers in the matter of issuing writs on the High Court, the rem edy of writ absolutely discretionary in character. If the High Court is satisfie d that the aggrieved party can have an adequate or suitable relief elsewhere, it can refuse to exercise its jurisdiction. The Court, in extraordinary circumstan ces, may exercise the power if it comes to the conclusion that there has been a breach of principles of natural justice or procedure required for decision has n ot been adopted.(See: N.T. Veluswami Thevar vs. G. Raja Nainar , AIR 1959 SC 422 ; Municipal Council, Khurai vs. Kamal Kumar , (1965) 2 SCR 653; Siliguri Municip ality vs. Amalendu Das , (1984) 2 SCC 436; S.T. Muthusami vs. K. Natarajan , (19 88) 1 SCC 572; Rajasthan SRTC vs. Krishna Kant , (1995) 5 SCC 75; Kerala SEB vs. Kurien E. Kalathil, (2000) 6 SCC 293; A. Venkatasubbiah Naidu vs. S. Chellappan , (2000) 7 SCC 695; L.L. Sudhakar Reddy vs. State of A.P ., (2001) 6 SCC 634; S hri Sant Sadguru Janardan Swami (Moingiri Maharaj) Sahakari Dugdha Utpadak Sanst ha vs. State of Maharashtra , (2001) 8 SCC 509; Pratap Singh vs. State of Haryan a , (2002) 7 SCC 484 and GKN Driveshafts (India) Ltd. vs. ITO , (2003) 1 SCC 72) . * * * * * * * * * 15. Thus, while it can be said that this Court has recognized some exceptions to the rule of alternative remedy, i.e., where the statutory authority has not act ed in accordance with the provisions of the enactment in question, or in defianc e of the fundamental principles of judicial procedure, or has resorted to invoke the provisions which are repealed, or when an order has been passed in total vi olation of the principles of natural justice, the proposition laid down in Thans ingh Nathmal case, Titagarh Paper Mills case and other similar judgments that th e High Court will not entertain a petition under Article 226 of the Constitutio n if an effective alternative remedy is available to the aggrieved person or the statute under which the action complained of has been taken itself contains a m echanism for redressal of grievance still holds the field. Therefore, when a sta tutory forum is created by law for redressal of grievances, a writ petition shou ld not be entertained ignoring the statutory dispensation. 16. In the instant case, the Act provides complete machinery for the assessment/ re-assessment of tax, imposition of penalty and for obtaining relief in respect of any improper orders passed by the Revenue Authorities, and the assessee could not be permitted to abandon that machinery and to invoke the jurisdiction of th e High Court under Article 226 of the Constitution when he had adequate remedy open to him by an appeal to the Commissioner of Income Tax (Appeals). The remedy under the statute, however, must be effective and not a mere formality with no substantial relief. In Ram and Shyam Co. vs. State of Haryana , (1985) 3 SCC 267 this Court has noticed that if an appeal is from Caesar to Caesar’s wife  the existence of alternative remedy would be a mirage and an exercise in futility. The above decision has very succinctly restated the legal position. Keep

ing the above in mind, it is evident that in the instant case respondent Nos.1 to 6 have the statutory remedy of invoking the provision of Section 3H(4) of the 1956 Act but without availing such remedy, they have approached the writ court. Having regard to the above, we are of the unhesitant view that the writ petition of respondent Nos. 1 to 6 is misconceived and learned Single Judge had erred in passing the order dated 15.05.2017. Legality and validity of the order dated 07 .03.2017 passed by the Additional Deputy Commissioner, Sivasagar can certainly b e gone into on a reference made to the jurisdictional Principal Civil Court by t he competent authority. That being the position, order dated 15.05.2017 cannot b e sustained and is accordingly set aside. Consequently, writ petition is dismiss ed. However, dismissal of the writ petition would not be a bar for respondent Nos. 1 to 6 to approach the competent authority under sub-Section (4) of Section 3H of the National Highways Act, 1956 for making a reference to the Principal Civil C ourt of original jurisdiction. Writ appeal is allowed but without any order as to cost.