Supreme Court clarifies review jurisdiction in land acquisition cases: Govt. of NCT of Delhi vs. K.L. Rathi Steel S Limited (2024) INSC 454 (17 May 2024)

Case Background

The case revolves around a series of review petitions (RPs) filed by the Delhi Development Authority (DDA) and the Government of NCT of Delhi. These RPs challenged earlier judgments that had declared land acquisition proceedings as lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (2013 Act). These earlier judgments were based on the interpretation of the law in Pune Municipal Corporation v. Harakchand Misirimal Solanki, which was later overruled. The review petitioners sought to revive these acquisition proceedings, arguing that the overruling of the precedent justified a review of the earlier judgments. The landowners, however, contended that the review petitions were not maintainable under the law.

Timeline

Course of Proceedings

The High Court, relying on the Supreme Court’s decision in Pune Municipal Corporation v. Harakchand Misirimal Solanki, declared the land acquisition proceedings as lapsed. The Government of NCT of Delhi and the DDA appealed this decision to the Supreme Court, which dismissed the appeals. Subsequently, after the decision in Indore Development Authority v. Shailendra [3-Judge], the appellants filed review petitions, arguing that the overruling of Pune Municipal Corporation was a sufficient ground for review. A split verdict arose in the Supreme Court regarding the maintainability of the review petitions, leading to the constitution of a larger bench.

Legal Framework

The core legal issue revolves around Section 24(2) of the 2013 Act, which states that land acquisition proceedings initiated under the Land Acquisition Act, 1894 (1894 Act) are deemed to have lapsed if physical possession of the land has not been taken or compensation has not been paid to the landowners. The review petitions were filed under Section 114 of the Code of Civil Procedure (CPC) read with Order XLVII, which outlines the grounds for review. The Explanation to Rule 1 of Order XLVII, CPC, which was inserted in 1976, is particularly relevant. It states:

“The fact that the decision on a question of law on which the judgment of the Court is based has been reversed or modified by the subsequent decision of a superior court in any other case, shall not be a ground for the review of such judgment.”

This Explanation prohibits the review of a judgment solely on the ground that the legal precedent it relied upon has been overruled by a superior court.

Arguments

The review petitioners argued that the overruling of Pune Municipal Corporation and the ‘liberty’ granted by the Supreme Court in Indore Development Authority v. Shailendra [3-Judge] justified a review. They contended that dismissing the review petitions would cause injustice and undermine public interest, especially since the lands were needed for public projects. They also argued that the recall of Pune Municipal Corporation erased the legal basis of the earlier judgments.

The respondent landowners countered that the Explanation to Rule 1 of Order XLVII, CPC, barred the review petitions. They argued that the judgments based on Pune Municipal Corporation were valid when delivered and had attained finality. They further contended that Indore Development Authority v. Manoharlal [5-Judge, lapse] did not endorse any ‘liberty’ to file review petitions and that the review petitions were filed after substantial delays.

Issues Framed by the Supreme Court

The Supreme Court framed the following issues:

1. Can the review petitioners, on the basis of the pleadings in the RPs, be considered persons aggrieved?
2. Whether the last sentence of paragraph 217 of Shailendra [3-Judge] grants ‘liberty’ to any party to seek a review of Pune Municipal Corporation?
3. If the answer to (b) is in the affirmative, did such ‘liberty’ survive after the decision in Manoharlal [5-Judge, lapse]?
4. Can the RPs be held to be maintainable, giving due regard to the Explanation in Rule 1 of Order XLVII, CPC vis-à-vis Manoharlal [5-Judge, lapse]?
5. If the answer to (d) is in the negative, do the RPs still deserve to be entertained on the other grounds urged therein?
6. Are the miscellaneous applications maintainable?

Treatment of the Issue by the Court

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

Authorities

The Supreme Court considered several cases and legal provisions to arrive at its decision. These have been categorized below:

The relevant legal provisions considered were:

• Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.
• Section 114 and Order XLVII of the Code of Civil Procedure (CPC).
• Article 137, 141 and 142 of the Constitution of India.

Judgment

The Supreme Court held that the review petitions were not maintainable. It found that the Explanation to Rule 1 of Order XLVII, CPC, clearly bars a review based solely on the subsequent overruling of a precedent. The Court rejected the argument that the ‘liberty’ granted in Shailendra [3-Judge] justified the review, stating that such an interpretation would lead to chaos and undermine the principle of finality of judgments.

The Court also analyzed how the authorities were viewed:

• Pune Municipal Corporation v. Harakchand Misirimal Solanki: Overruled and recalled, but its overruling is not a ground for review.
• Indore Development Authority v. Shailendra [3-Judge]: Its observation regarding review was held not to be a grant of ‘liberty’ for review.
• Board of Control for Cricket in India v. Netaji Cricket Club: Distinguished as it was confined to the specific facts of that case.
• Chajju Ram v. Neki: Followed, regarding the interpretation of “any other sufficient reason”.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the need to uphold the law as laid down in the Code of Civil Procedure (CPC), particularly the Explanation to Rule 1 of Order XLVII. The Court emphasized the importance of maintaining judicial discipline and ensuring the finality of judgments. The sentiment analysis of the reasons given by the Supreme Court is as follows:

The ratio of fact to law that influenced the court to decide is as follows:

The Court’s reasoning can be summarized in the following flowchart:

The Court considered alternative interpretations, such as the expansive view of “any other sufficient reason” in Netaji Cricket Club, but ultimately rejected them in favor of the established interpretation in Chhajju Ram. The Court also rejected the argument that the recall of Pune Municipal Corporation changed the legal position, emphasizing that the judgments were correct when delivered.

The Court emphasized that the power of review is not an inherent power and is subject to the statutory provisions of the CPC. It clarified that while the court has inherent powers to correct its mistakes, such powers cannot be invoked when there is a specific remedy available under the CPC, such as a review petition.

The Court also considered the argument that public interest should override the legal restrictions, but it held that public interest cannot be a ground to circumvent the law.

The Court quoted the following from the judgment:

“The fact that the decision on a question of law on which the judgment of the Court is based has been reversed or modified by the subsequent decision of a superior court in any other case, shall not be a ground for the review of such judgment.”

“The words ‘sufficient reason’ in Order 47 Rule 1 of the Code are wide enough to include a misconception of fact or law by a court or even an advocate.”

“The inherent powers of the Court are in addition to the powers specifically conferred on the Court by the Code. They are complementary to those powers and therefore it must be held that the Court is free to exercise them for the purposes mentioned in Section 151 of the Code when the exercise of those powers is not in any way in conflict with what has been expressly provided in the Code or against the intentions of the Legislature.”

Key Takeaways

• A judgment cannot be reviewed solely because the legal precedent it relied upon was later overruled.
• The Explanation to Rule 1 of Order XLVII, CPC, is a clear bar to such reviews.
• The ‘liberty’ granted by a court cannot override the statutory limitations on review jurisdiction.
• Public interest cannot be a ground to circumvent the law.
• The power of review is not an inherent power and is subject to the provisions of the CPC.
• Inherent powers cannot be invoked when a specific remedy is available under the CPC.

The judgment clarifies that the Supreme Court will strictly adhere to the provisions of the CPC when exercising its review jurisdiction. It also reinforces the principle of finality of judgments and the importance of judicial discipline. This decision has significant implications for future cases involving review petitions based on overruled precedents.

Directions

The Supreme Court, exercising its powers under Article 142 of the Constitution, issued the following directions:

• The time limit for initiating fresh acquisition proceedings under Section 24(2) of the 2013 Act is extended by one year from August 1, 2024.
• Status quo on possession, land use, and third-party rights must be maintained until fresh acquisition proceedings are completed.
• Compliance with Chapters II and III of the 2013 Act is dispensed with.
• Compliance with Sections 13, 14, 16 to 20 of the2013 Act is also dispensed with.

These directions were issued to ensure that complete justice is done in the matter, taking into consideration the public interest and the need for the land for public projects.