Supreme Court Clarifies Land Acquisition Lapse Under 2013 Act: Delhi Development Authority vs. Jagan Singh (2023)

Introduction

Date of the Judgment: July 13, 2023
Citation: 2023 INSC 620
Judges: Abhay S. Oka, J. and Sanjay Karol, J.

Can land acquisition proceedings be deemed to have lapsed if the authorities have taken possession of the land but not paid compensation? The Supreme Court of India addressed this critical question in a recent judgment, clarifying the interpretation of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. This case involved a dispute between the Delhi Development Authority (DDA) and a landowner, concerning land acquired for a public project. The bench comprised Justices Abhay S. Oka and Sanjay Karol, with the judgment authored by Justice Abhay S. Oka.

Case Background

The case revolves around land acquired by the Delhi Development Authority (DDA) under the Land Acquisition Act, 1894. The initial notification for acquisition was issued on June 23, 1989. An award was made on June 18, 1992. The first respondent, Jagan Singh, filed a writ petition in 1990 challenging the acquisition, which was dismissed on May 20, 2005. The DDA took possession of the land on January 19, 2006. Subsequently, the Land Acquisition Act, 1894 was repealed and replaced by the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, which came into effect on January 1, 2014. On May 25, 2015, Jagan Singh filed another writ petition, arguing that the acquisition should be deemed to have lapsed under Section 24(2) of the 2013 Act, as compensation had not been paid despite the DDA taking possession. The High Court of Delhi, relying on a previous Supreme Court decision, ruled in favor of Jagan Singh, directing the DDA to pay compensation as per the 2013 Act.

Timeline

Course of Proceedings

The High Court of Delhi, in its judgment dated August 11, 2016, ruled in favor of the first respondent, Jagan Singh. The High Court relied on the Supreme Court’s decision in Pune Municipal Corporation & Anr. v. Harakchand Misirimal Solanki & Ors. [(2014) 3 SCC 183], holding that the acquisition had lapsed under Section 24(2) of the 2013 Act because compensation had not been paid, even though possession had been taken. The High Court directed the DDA to pay compensation to Jagan Singh as per the 2013 Act. The DDA then appealed to the Supreme Court against this decision.

Legal Framework

The core of this case lies in the interpretation of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The provision states:

“24. Land acquisition process under Act No.1 of 1894 shall be deemed to have lapsed in certain cases.–
(1) .. .. .. .. .. .. .. .. .. .. .. .. ..
(2) Notwithstanding anything contained in sub-section (1), in case of land acquisition proceedings initiated under the Land Acquisition Act, 1894 (1 of 1894), where an award under the said section 11 has been made five years or more prior to the commencement of this Act but the physical possession of the land has not been taken or the compensation has not been paid the said proceedings shall be deemed to have lapsed and the appropriate Government, if it so chooses, shall initiate the proceedings of such land acquisition afresh in accordance with the provisions of this Act.
Provided that where an award has been made and compensation in respect of a majority of land holdings has not been deposited in the account of the beneficiaries, then, all beneficiaries specified in the notification for acquisition under section 4 of the said Land Acquisition Act, shall be entitled to compensation in accordance with the provisions of this Act.”

The Supreme Court also considered its previous decisions, specifically the Constitution Bench decision in Indore Development Authority v. Manoharlal & Ors. [(2020) 8 SCC 129], which overruled Pune Municipal Corporation & Anr. v. Harakchand Misirimal Solanki & Ors. [(2014) 3 SCC 183] and other decisions based on it. The Court also noted that the decision in Sree Balaji Nagar Residential Association v. State of Tamil Nadu & Ors. [(2015) 3 SCC 353], which was also relied upon in the impugned judgment, was held to be not correct.

Arguments

Appellant’s Submissions (Delhi Development Authority):

• The appellant argued that the acquired land has already been used for public purposes, specifically for the Delhi Metro Rail Corporation (DMRC) metro depot.
• The appellant contended that the acquisition cannot be declared lapsed based on a decision that has been expressly overruled.
• The appellant maintained that the reasons for the delay in filing the appeal were adequately explained.

First Respondent’s Submissions (Jagan Singh):

• The first respondent argued that there was no proper explanation for the long delay of 1231 days in approaching the Supreme Court.
• The first respondent submitted that the conduct of the appellant and the Government of NCT of Delhi indicated their acquiescence to the High Court’s judgment.
• The first respondent contended that the court should not adopt a different approach for condonation of delay applications made by the State or its agencies.
• The first respondent argued that merely because a judgment was overruled, the appellant cannot succeed unless the delay is sufficiently explained.
• The first respondent relied on the appellant’s policy dated December 22, 2017, which deals with initiating fresh acquisition proceedings when acquisitions are declared lapsed under Section 24(2) of the 2013 Act.
• The first respondent submitted that since the land is already used for public purposes, the High Court’s direction to pay compensation under the 2013 Act should be upheld.

Issues Framed by the Supreme Court

The primary issue before the Supreme Court was whether the delay of 1231 days in filing the appeal should be condoned.

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues

Authorities

The Supreme Court considered the following authorities:

The Court also considered the following legal provisions:

• Section 4(1) of the Land Acquisition Act, 1894: Notification for land acquisition.
• Section 11 of the Land Acquisition Act, 1894: Award of compensation.
• Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013: Lapsed land acquisition proceedings.
• Section 5 of the Limitation Act, 1963: Condonation of delay.

Judgment

How each authority was viewed by the Court?

• The Supreme Court explicitly stated that the decision in Pune Municipal Corporation & Anr. v. Harakchand Misirimal Solanki & Ors. [(2014) 3 SCC 183]* was overruled by the Constitution Bench in Indore Development Authority v. Manoharlal & Ors. [(2020) 8 SCC 129]*. This meant that the High Court’s reliance on the overruled judgment was incorrect.
• The decision in Indore Development Authority v. Manoharlal & Ors. [(2020) 8 SCC 129]* was followed as the correct interpretation of Section 24(2) of the 2013 Act. The Constitution Bench clarified that the word “or” between possession and compensation in Section 24(2) should be read as “nor” or “and.” Thus, land acquisition proceedings lapse only if both possession has not been taken and compensation has not been paid.
• The Court also noted that the decision in Sree Balaji Nagar Residential Association v. State of Tamil Nadu & Ors. [(2015) 3 SCC 353]* was held to be not correct by the Constitution Bench in Indore Development Authority.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the following factors:

• The fact that the acquired land had already been utilized for a significant public purpose, namely the Delhi Metro depot.
• The High Court’s judgment was based on a decision that had been expressly overruled by a Constitution Bench of the Supreme Court.
• The Court’s inclination to adopt a liberal approach in condoning delays to ensure substantive justice, especially when public interest is involved.

Logical Reasoning:

The Court also considered and rejected the argument that the DDA’s policy on fresh acquisition should apply, stating that the policy is only relevant when an acquisition has validly lapsed, which was not the case here.

The Court emphasized the need for a justice-oriented approach, stating that “a liberal and justice-oriented approach needs to be adopted in the matters of condonation of delay so that the substantive rights of the parties are not defeated only on the ground of delay.” The Court also noted that “the power under Section 5 of the Limitation Act, 1963 must be exercised in a very meaningful manner which will serve the ends of justice.” However, the Court also stated that “the fact that the decision on which the impugned judgment is based has been overruled is by itself no ground to condone a long delay.”

The Court also observed that the acquired land was being used for a public purpose and that “the use of the land for public purposes for the last several years is certainly a relevant factor for adopting a liberal approach while considering the prayer for condoning the delay.”

Key Takeaways

• The Supreme Court clarified that under Section 24(2) of the 2013 Act, land acquisition proceedings lapse only if both physical possession has not been taken AND compensation has not been paid.
• The use of acquired land for a public purpose is a significant factor in condoning delays in appeals related to land acquisition.
• Courts should adopt a liberal and justice-oriented approach when considering condonation of delay, especially when public interest is involved.
• A judgment based on a decision that has been overruled is not valid.
• Land owners are entitled to compensation as per the award made under the Land Acquisition Act, 1894 and not under the 2013 Act if the acquisition is valid.

Directions

The Supreme Court issued the following directions:

1. The impugned judgment and order of the High Court dated August 11, 2016, was quashed and set aside.
2. The writ petition filed by the first respondent before the High Court was dismissed.
3. The appellant was directed to pay costs of ₹50,000 to the first respondent within one month.
4. The first respondent was directed to provide bank account details for the payment of costs.
5. If compensation as per the award under the 1894 Act has not been paid, the appellant was directed to pay it within one month.
6. The appellant and all concerned authorities were directed to take action to remove encroachments on the pavement abutting the metro depot.

Development of Law

The ratio decidendi of this case is that the word “or” in Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, should be read as “nor” or “and”. This means that land acquisition proceedings lapse only if both possession has not been taken and compensation has not been paid. This decision reinforces the interpretation provided by the Constitution Bench in Indore Development Authority v. Manoharlal & Ors. [(2020) 8 SCC 129] and overrules the earlier view taken in Pune Municipal Corporation & Anr. v. Harakchand Misirimal Solanki & Ors. [(2014) 3 SCC 183]. This case clarifies the circumstances under which land acquisition proceedings can be deemed to have lapsed, providing a clear legal position on the matter.

Conclusion

In conclusion, the Supreme Court allowed the appeal filed by the Delhi Development Authority, setting aside the High Court’s judgment. The Court clarified that land acquisition proceedings do not lapse under Section 24(2) of the 2013 Act if possession has been taken, even if compensation has not been paid. The Court condoned the delay in filing the appeal, considering the public interest involved and the fact that the High Court’s decision was based on an overruled judgment. The Court emphasized the need for a justice-oriented approach and directed the DDA to pay the compensation as per the award under the Land Acquisition Act, 1894.

Category

Parent Category: Land Acquisition Law

Child Categories:

• Section 24(2), Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013
• Lapse of Land Acquisition Proceedings
• Condonation of Delay
• Public Purpose

Parent Category: Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013

Child Categories:

• Section 24(2), Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013

Parent Category: Land Acquisition Act, 1894

Child Categories:

• Section 11, Land Acquisition Act, 1894

FAQ

Q: What is Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013?

A: Section 24(2) deals with the lapse of land acquisition proceedings initiated under the Land Acquisition Act, 1894. It states that if an award was made five years or more before the 2013 Act came into force, and either physical possession was not taken OR compensation was not paid, the acquisition proceedings would lapse.

Q: What did the Supreme Court clarify about the interpretation of Section 24(2)?

A: The Supreme Court clarified that the word “or” in Section 24(2) should be read as “nor” or “and.” This means that the acquisition proceedings lapse only if BOTH possession has not been taken AND compensation has not been paid.

Q: What happens if the land has been acquired for a public purpose?

A: If the acquired land is being used for a public purpose, such as a metro depot, the Court is more likely to adopt a liberal approach in condoning delays in appeals related to land acquisition, ensuring that the public interest is not hampered.

Q: What does it mean for a judgment to be based on an overruled decision?

A: If a judgment is based on a legal decision that has been overruled by a higher court, the judgment is no longer valid. In this case, the High Court’s judgment was based on a Supreme Court decision that was later overruled by a Constitution Bench.

Q: What compensation is the landowner entitled to in this case?

A: The landowner is entitled to compensation as per the award made under the Land Acquisition Act, 1894, and not under the 2013 Act because the acquisition was held to be valid.