Supreme Court Clarifies Land Acquisition Lapse Under Section 24(2) of the 2013 Act: DDA vs. Asha Jain (2022)

Introduction

Date of the Judgment: November 09, 2022
Citation: Civil Appeal No. 8088 of 2022
Judges: M.R. Shah, J. and M.M. Sundresh, J.
Can land acquisition proceedings lapse if compensation isn’t paid, even if possession of the land has been taken? The Supreme Court of India recently addressed this crucial question in a case involving the Delhi Development Authority (DDA) and a landowner, clarifying the interpretation of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. This judgment overturns a previous High Court decision, providing much-needed clarity on the conditions under which land acquisition can lapse. The bench consisted of Justices M.R. Shah and M.M. Sundresh, with Justice M.R. Shah authoring the judgment.

Case Background

The case revolves around land acquired by the Delhi Development Authority (DDA) for planned development in Delhi. The initial notification for acquisition was issued on 25.11.1980, targeting a large area including land in Village Neb Sarai. The land in question was originally part of Khasra No. 675, recorded in the name of M/s. Laxmichand Bhagaji Limited, a non-banking company. The possession of the land was taken by the DDA in 2005. The original writ petitioner, Asha Jain, claimed her right to the land through an Agreement to Sell dated 09.05.2005. The High Court of Delhi ruled in favor of Asha Jain, stating that the acquisition had lapsed under Section 24(2) of the Act of 2013 because compensation had not been paid to the recorded owners. The DDA appealed this decision to the Supreme Court.

Timeline

Course of Proceedings

The High Court of Delhi, relying on the Supreme Court’s decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, ruled that the acquisition had lapsed because compensation had not been paid to the recorded owners, despite the DDA taking possession of the land in 2005. The Delhi Development Authority (DDA) appealed this decision to the Supreme Court, challenging the High Court’s interpretation of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.

Legal Framework

The core legal issue revolves around Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, which states:

“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 Act 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.”

The Supreme Court also considered Section 4 of the Land Acquisition Act, 1894, which deals with the publication of preliminary notification for land acquisition. Additionally, the Court referred to Section 31(1) of the Land Acquisition Act, 1894 regarding the tendering of compensation.

Arguments

The Delhi Development Authority (DDA) argued that:

• The High Court erred in relying on the decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, which was subsequently overruled by the Constitution Bench in Indore Development Authority Vs. Manoharlal and Ors. (2020) 8 SCC 129.
• As per the ruling in Indore Development Authority Vs. Manoharlal and Ors. (2020) 8 SCC 129, the word “or” in Section 24(2) should be read as “nor” or “and,” meaning that acquisition lapses only if neither possession has been taken nor compensation has been paid.
• The original writ petitioner, Asha Jain, was a subsequent purchaser with no right to claim lapse of acquisition, as established in Delhi Development Authority Vs. Godfrey Phillips (I) Ltd. & Ors., Civil appeal No. 3073 of 2022, Meera Sahni Vs. Lieutenant Governor of Delhi & Ors., (2008) 9 SCC 173 and M. Venkatesh & Ors. Vs. Commissioner, Bangalore Development Authority, (2015) 17 SCC 1 and Shiv Kumar & Anr. Vs. Union of India & Ors., (2019) 10 SCC 229.
• An Agreement to Sell does not confer any right, title, or interest in the land.

Asha Jain, the original writ petitioner, argued that:

• Since compensation was not paid to the recorded owners, the acquisition should lapse under Section 24(2) of the 2013 Act.
• The High Court’s decision, based on the ruling in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, was correct in declaring the acquisition lapsed.

Submissions of Parties

Issues Framed by the Supreme Court

The primary issue before the Supreme Court was:

1. Whether the High Court was correct in declaring that the acquisition with respect to the land in question is deemed to have lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013?

Treatment of the Issue by the Court

Authorities

The Supreme Court considered the following authorities:

Interpretation of Section 24(2) of the 2013 Act:

• Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183 – Supreme Court of India
• Indore Development Authority Vs. Manoharlal and Ors. (2020) 8 SCC 129 – Supreme Court of India

Rights of Subsequent Purchasers:

• Delhi Development Authority Vs. Godfrey Phillips (I) Ltd. & Ors., Civil appeal No. 3073 of 2022 – Supreme Court of India
• Meera Sahni Vs. Lieutenant Governor of Delhi & Ors., (2008) 9 SCC 173 – Supreme Court of India
• M. Venkatesh & Ors. Vs. Commissioner, Bangalore Development Authority, (2015) 17 SCC 1 – Supreme Court of India
• Shiv Kumar & Anr. Vs. Union of India & Ors., (2019) 10 SCC 229 – Supreme Court of India

Legal Provisions:

• Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013
• Section 4 of the Land Acquisition Act, 1894
• Section 31(1) of the Land Acquisition Act, 1894

Authority Consideration

Judgment

The Supreme Court allowed the appeal of the Delhi Development Authority (DDA) and set aside the High Court’s judgment. The Court held that the acquisition did not lapse under Section 24(2) of the 2013 Act.

What weighed in the mind of the Court?

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

• The correct interpretation of Section 24(2) of the 2013 Act, as clarified in Indore Development Authority Vs. Manoharlal and Ors. (2020) 8 SCC 129, which mandates that the word “or” should be read as “nor” or “and,” indicating that acquisition lapses only when both possession is not taken and compensation is not paid.
• The fact that possession of the land was taken by the DDA in 2005, which negates any claim of lapse under Section 24(2).
• The legal principle that a subsequent purchaser, like the original writ petitioner, cannot claim the lapse of acquisition proceedings.
• The overruling of the decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, which was the basis for the High Court’s decision.

Key Takeaways

The key takeaways from this judgment are:

• The word “or” in Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, must be read as “nor” or “and.” This means that land acquisition proceedings will only lapse if both possession has not been taken and compensation has not been paid.
• Subsequent purchasers of land cannot claim the lapse of acquisition proceedings under Section 24(2) of the 2013 Act.
• The decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, has been explicitly overruled, clarifying the legal position on the interpretation of Section 24(2).
• This judgment provides clarity on the conditions under which land acquisition proceedings can lapse, ensuring that authorities are not penalized for taking possession of land even if compensation has not been paid immediately.

Directions

The Supreme Court did not provide any specific directions other than setting aside the High Court’s judgment and dismissing the writ petition.

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, must be read as “nor” or “and.” This interpretation means that land acquisition proceedings will only lapse if neither possession has been taken nor compensation has been paid. Additionally, subsequent purchasers of land cannot claim the lapse of acquisition proceedings. This judgment overruled the previous position of law as laid down in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183.

Conclusion

In conclusion, the Supreme Court’s judgment in Delhi Development Authority vs. Asha Jain & Ors. clarifies the interpretation of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The Court held that the word “or” in the section must be read as “nor” or “and,” meaning that land acquisition proceedings lapse only if both possession has not been taken and compensation has not been paid. The Court also affirmed that subsequent purchasers cannot claim the lapse of acquisition proceedings. This decision overrules the previous position in Pune Municipal Corporation and provides much-needed clarity on the matter.