New Delhi: The Supreme Court on Tuesday ruled
government has to strictly comply with the twin conditions of
acquiring land for "public purpose" and adequately fulfilling
the "compensation" claim to the outsees.
"Public purpose is a pre-condition for deprivation of a
person from his property under Article 300A and the right to
claim compensation is also inbuilt in that Article and when a
person is deprived of his property, the state has to justify
both the grounds," a five-judge constitution bench headed
Chief Justice SH Kapadia said.
It said justification of the grounds may depend on scheme
of the statute, legislative policy, object and purpose of the
legislature and other related factors.
The bench said the same principle would be applicable for
the acquisition of land of foreign investors.
The issue of foreign investors was dealt by the bench as
the Karnataka government had acquired the land which was sold
to a private company KT Plantation by Russian-origin Roerich
couple related with the family of nobel Laurette Rabindranath
"Deprivation of property may also cause serious concern
in the area of foreign investment, especially in the context
of international law and international investment agreements.
"Whenever a foreign investor operates within the
territory of a host country, the investor and its properties
are subject to the legislative control of the host country,
along with the international treaties or agreements. Even, if
the foreign investor has no fundamental right, let them know,
that the rule of law prevails in this country," the bench
The bench, which also consisted of justices Mukundakam
Sharma, KS Radhakrishnan, Swatanter Kumar and Anil R Dave
said citizens right for compensation against such acquisition
is derived from Article 300 A and statues and special Acts
made by the government to acquire the property of a citizen is
always amenable to judicial review.
"Any law, which deprives a person of his private property
for private interest, will be unlawful and unfair and
undermines the rule of law and can be subjected to judicial
review," the apex court said adding "but the question as to
whether the purpose is primarily public or private has to
be decided by the legislature, which of course should be made
"The concept of public purpose has been given fairly
expansive meaning which has to be justified upon the purpose
and object of statute and the policy of the legislation.
Public purpose is, therefore, a condition precedent, for
invoking Article 300A," it said.