Supreme Court Clarifies Applicability of Land Acquisition Act to Bangalore Development Authority

Date of the Judgment: January 20, 2022

Citation: 2022 INSC 70

Judges: S. Abdul Nazeer, J. and Sanjiv Khanna, J.

Can the Bangalore Development Authority (BDA) acquire land using the old Land Acquisition Act of 1894, or does it have to follow the new 2013 Act? The Supreme Court addressed this question in a recent case concerning the Peripheral Ring Road (PRR) project in Bangalore. This judgment clarifies the legal framework for land acquisition by the BDA, settling a dispute that had significant implications for the project’s budget and execution. The bench comprised Justices S. Abdul Nazeer and Sanjiv Khanna, with the judgment authored by Justice S. Abdul Nazeer.

Case Background

The Bangalore Development Authority (BDA) proposed a Peripheral Ring Road (PRR) in 2006 to ease traffic congestion in Bangalore. The State Government sanctioned the project in 2007. The BDA initiated land acquisition for the PRR, leading to several writ petitions in the High Court of Karnataka challenging the acquisition notifications. The core issue was whether the repeal of the Land Acquisition Act, 1894, by the 2013 Act would affect the BDA’s acquisition proceedings.

Timeline:

Course of Proceedings

The High Court of Karnataka, in a judgment dated 22.07.2014, addressed the writ petitions. The Single Judge held that the Land Acquisition Act, 1894, was applicable to the BDA through “legislation by reference.” The court also stated that the 2013 Act would regulate the acquisition proceedings, including compensation, since no award had been passed. The BDA then appealed to the Supreme Court, arguing that the High Court had not considered the Constitution Bench judgment in Offshore Holdings Private Limited v. Bangalore Development Authority and others and that Section 36 of the BDA Act mandated “legislation by incorporation.”

Legal Framework

The Bangalore Development Authority Act, 1976, was enacted to establish a development authority for Bangalore. Section 14 outlines the Authority’s objective to promote the development of the Bangalore Metropolitan Area. Chapter IV of the BDA Act deals with land acquisition. Section 36(1) of the BDA Act states:

“The acquisition of land under this Act otherwise than by agreement within or without the Bangalore Metropolitan Area shall be regulated by the provisions, so far as they are applicable, of the Land Acquisition Act, 1894.”

This section incorporates provisions of the Land Acquisition Act, 1894, into the BDA Act. The Supreme Court noted that the BDA Act has its own complete process for determining rights, and the Land Acquisition Act is only applicable to matters not specifically dealt with in the BDA Act.

Arguments

Bangalore Development Authority’s (BDA) Arguments:

• The BDA argued that the High Court’s direction to apply the 2013 Act had upset the project’s budget calculations.
• The BDA contended that the High Court failed to consider the Supreme Court’s judgment in Offshore Holdings Private Limited v. Bangalore Development Authority and others, which held that Section 36 of the BDA Act mandates “legislation by incorporation.”
• The BDA submitted that Section 36 of the BDA Act clearly incorporates the provisions of the Land Acquisition Act, 1894, and that the 2013 Act should not apply.

The State of Karnataka’s Arguments:

• The State of Karnataka argued that the 2013 Act should apply to the acquisition proceedings, as the Land Acquisition Act, 1894, had been repealed.
• The State supported the High Court’s view that the 2013 Act would regulate the acquisition proceedings, including compensation.

Submissions of Parties

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in a separate section, but the core issue was:

✓ Whether the provisions of the Land Acquisition Act, 1894, or the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, apply to land acquisitions made under the Bangalore Development Authority Act, 1976.

Treatment of the Issue by the Court

Authorities

The Supreme Court relied on the following authorities:

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

• The Court followed Offshore Holdings Private Limited v. Bangalore Development Authority and others [2011] 3 SCC 139*, which held that Section 36 of the BDA Act is a legislation by incorporation.
• The Court used C.N. Paramasivam and Another vs. Sunrise Plaza Through Partner and Others [2013] 9 SCC 460* to explain the concept of incorporation of an earlier Act into a later Act.
• The Court relied on Special Land Acquisition Officer, KIADB, Mysore and Another vs. Anasuya Bai (dead) by Legal Representatives and others [2017] 3 SCC 313* to support the view that Section 24(2) of the 2013 Act is not applicable for acquisitions under the BDA Act.
• The Court referred to State of M.P. v. M.V. Narasimhan [2011] 3 SCC 111* to support the principle that borrowed provisions become an integral part of the subsequent Act.
• The Court agreed with the conclusion of Sri. L. Ramareddy vs. the State of Karnataka and Ors. (W.A. No.1415/2018)* that Section 24 of the 2013 Act does not apply to acquisitions under the BDA Act.

What weighed in the mind of the Court?

The Supreme Court emphasized the importance of the principle of “legislation by incorporation” as established in previous judgments. The Court noted that the BDA Act has its own complete process for determining rights, and the Land Acquisition Act is only applicable to matters not specifically dealt with in the BDA Act. The Court also highlighted that the 2013 Act expressly refers to land acquisition proceedings initiated under the Land Acquisition Act, 1894, and not other enactments.

Logical Reasoning:

The Court rejected the interpretation that the 2013 Act would apply to acquisitions under the BDA Act. The Court reasoned that the BDA Act had incorporated the provisions of the Land Acquisition Act, 1894, and that the 2013 Act only applied to acquisitions initiated under the Land Acquisition Act, 1894. The court also emphasized that the BDA Act is a self-contained code with its own process for determining rights.

The Court stated, “Therefore, the provisions of the LA Act continue to apply for acquisitions made in the BDA Act so far as they are applicable as it is a legislation by incorporation having regard to Section 36 of the BDA Act.”

The Court further clarified, “The 2013 Act repeals only the LA Act and not any other Central or State enactment dealing with acquisition. Therefore, what is sought to be saved under Section 24 of the 2013 Act is only acquisitions which had been initiated under the LA Act and not those acquisitions which had been initiated under any other Central or State enactment.”

The Court also emphasized, “We are of the view that 2013 Act would not regulate the acquisition proceedings made under the BDA Act.”

There were no minority opinions in this case. The bench consisted of two judges, and both concurred with the final decision.

Key Takeaways

• The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, does not apply to land acquisitions made under the Bangalore Development Authority Act, 1976.
• The Land Acquisition Act, 1894, continues to apply to acquisitions made under the BDA Act, as it is a legislation by incorporation.
• The BDA Act is a self-contained code with its own process for determining rights.
• This judgment clarifies the legal framework for land acquisition by the BDA and has implications for ongoing and future projects.

Directions

The Supreme Court directed the BDA to proceed with the land acquisition as proposed in the notification, in accordance with the provisions of the Land Acquisition Act, 1894.

Development of Law

The Supreme Court reiterated the principle of “legislation by incorporation,” clarifying that when an earlier Act is incorporated into a later Act, the provisions of the earlier Act become an integral part of the later Act. This judgment reaffirms the position of law established in Offshore Holdings Private Limited and other cases, and clarifies that the 2013 Act does not affect acquisitions made under the BDA Act.

Conclusion

The Supreme Court’s judgment clarifies that the Land Acquisition Act, 1894, continues to govern land acquisitions by the Bangalore Development Authority (BDA), and the 2013 Act does not apply to such acquisitions. This decision upholds the principle of “legislation by incorporation” and settles a significant legal issue that had implications for the BDA’s ongoing projects, particularly the Peripheral Ring Road (PRR) project.