Supreme Court Overturns High Court on Land Acquisition Lapse: Government of NCT of Delhi vs. Manjeet Singh Anand (20 January 2023)

Date of the Judgment: 20 January 2023
Citation: Civil Appeal No. 360 of 2023 (@ SLP (C) NO. 1493 OF 2023) (@ DIARY NO. 22629 OF 2021)
Judges: M.R. Shah, J. and C.T. Ravikumar, J.
Can a land acquisition be deemed to have lapsed if the compensation was deposited in the court, but not directly paid to the landowner? The Supreme Court of India addressed this critical question in a recent judgment, overturning a decision of the High Court of Delhi. This case revolves around the interpretation of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, and its impact on land acquisitions initiated under the Land Acquisition Act, 1894. The two-judge bench, comprising Justices M.R. Shah and C.T. Ravikumar, delivered the judgment, with Justice M.R. Shah authoring the opinion.

Case Background

The case involves land acquired by the Government of NCT of Delhi in 1964. The initial notification for acquisition under Section 4 of the Land Acquisition Act, 1894, was issued on February 13, 1964. Subsequently, the award was declared on May 12, 1967. According to the Land Acquisition Collector (LAC), physical possession of the land was taken on June 7, 1967, and the compensation was deposited with the Reference Court on November 13, 1967. Years later, after the enactment of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, the respondent, Manjeet Singh Anand, filed a writ petition before the High Court of Delhi. Anand, claiming to be the owner based on a General Power of Attorney and receipts, sought a declaration that the acquisition proceedings had lapsed under Section 24(2) of the 2013 Act.

Timeline

Course of Proceedings

The High Court of Delhi, relying on its earlier decision in Smt. Harbans Kaur Vs. Govt. of NCT of Delhi and Ors. [W.P.(C) 5358 of 2014, decided on 02.02.2015], allowed the writ petition filed by Manjeet Singh Anand. The High Court in Smt. Harbans Kaur case had relied upon the Supreme Court’s decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183. The High Court declared that the acquisition proceedings had lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, despite the fact that the respondent was not the recorded owner of the land. The Government of NCT of Delhi then appealed to the Supreme Court against this decision.

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 deals with the lapse of land acquisition proceedings initiated under the Land Acquisition Act, 1894. Section 24(2) 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, in this case, interprets the word “or” in the phrase “possession of the land has not been taken or the compensation has not been paid” as “nor” or “and”. This means that for a land acquisition to lapse, both the possession must not have been taken, and the compensation must not have been paid.

Arguments

Appellant (Government of NCT of Delhi) Arguments:

• The acquisition proceedings were initiated in 1964, and possession was taken in 1967.
• Compensation was deposited with the Reference Court in 1967.
• The respondent, Manjeet Singh Anand, was not the recorded owner of the land and had no locus standi to challenge the acquisition.
• The High Court erred in relying on the overruled decision of Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183.
• The Supreme Court’s decision in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, clarified that the word “or” in Section 24(2) should be read as “nor” or “and”.

Respondent (Manjeet Singh Anand) Arguments:

• The respondent claimed that the acquisition proceedings had lapsed under Section 24(2) of the 2013 Act.
• The respondent relied on a General Power of Attorney and receipts to claim ownership of the land.
• The respondent argued that since the compensation was not directly paid to the landowner, the acquisition should lapse.

Innovativeness of the Argument: The respondent’s argument that the acquisition should lapse because the compensation was not directly paid to the landowner, but deposited in the court, was an attempt to exploit a literal interpretation of Section 24(2). However, this argument was ultimately rejected by the Supreme Court.

Issues Framed by the Supreme Court

The Supreme Court addressed the following key issues:

1. Whether the acquisition proceedings lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.
2. Whether the High Court erred in relying on the overruled decision of Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183.
3. Whether the respondent had the locus standi to challenge the acquisition proceedings.

Treatment of the Issue by the Court

Authorities

The Supreme Court considered 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 Supreme Court specifically overruled the decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, stating that it was no longer good law, as it had been overruled by the Constitution Bench in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129.
• The Supreme Court relied upon the decision in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, to interpret Section 24(2) of the 2013 Act.
• The High Court’s decision in Smt. Harbans Kaur Vs. Govt. of NCT of Delhi and Ors. [W.P.(C) 5358 of 2014, decided on 02.02.2015] was overturned because it relied on the overruled Pune Municipal Corporation case.
• The Supreme Court relied upon the decisions in Shiv Kumar and Anr. Vs. Union of India and Ors., (2019) 10 SCC 229, Delhi Development Authority Vs. Godfrey Philips (I) Ltd. & Ors. – Civil Appeal No. 3073 of 2022 and Delhi Administration Thr. Secretary, Land and Building Department & Ors. Vs. Pawan Kumar & Ors. – Civil Appeal No. 3646 of 2022, to establish that subsequent purchasers have no locus standi to challenge acquisition.

What weighed in the mind of the Court?

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

• The interpretation of Section 24(2) of the 2013 Act, specifically the meaning of “or” in the phrase “possession of the land has not been taken or the compensation has not been paid.”
• The fact that the possession of the land was taken in 1967 and compensation was deposited in the Reference Court in 1967.
• The fact that the respondent was not the recorded owner of the land and had no locus standi to challenge the acquisition.
• The need to adhere to the Constitution Bench’s decision in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, which had overruled the earlier decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183.

The Court emphasized the factual aspects of the case, such as the taking of possession and deposit of compensation, as well as the legal interpretation of Section 24(2) of the 2013 Act and the principle of locus standi.

The Supreme Court reasoned that the High Court had erred in relying on the overruled decision of Pune Municipal Corporation. The Court also held that the respondent had no locus standi to challenge the acquisition as he was not the recorded owner of the land. The Court emphasized that the word “or” in Section 24(2) must be read as “nor” or “and”, based on the Constitution Bench’s decision in Indore Development Authority. The Court stated:

“The deemed lapse of land acquisition proceedings under Section 24(2) of the 2013 Act takes place where due to inaction of authorities for five years or more prior to commencement of the said Act, the possession of land has not been taken nor compensation has been paid.”

The Court further clarified:

“In case possession has been taken, compensation has not been paid then there is no lapse. Similarly, if compensation has been paid, possession has not been taken then there is no lapse.”

The Supreme Court also noted:

“The expression “paid” in the main part of Section 24(2) of the 2013 Act does not include a deposit of compensation in court.”

The Court did not consider any alternative interpretations of Section 24(2) that would have supported the High Court’s decision. The Court’s decision was primarily based on the interpretation of the law as laid down by the Constitution Bench in Indore Development Authority and the facts of the case.

Key Takeaways

• 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 for a land acquisition to lapse, both possession must not have been taken, and compensation must not have been paid.
• Deposit of compensation in the Reference Court is considered sufficient for the purposes of Section 24(2).
• Subsequent purchasers of land do not have the locus standi to challenge the acquisition proceedings.
• The Supreme Court’s decision in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, is the binding authority on the interpretation of Section 24(2).

Directions

No specific directions were given by the Supreme Court in this judgment.

Specific Amendments Analysis

There is no specific amendment analysis in the judgment.

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 clarifies that both non-possession and non-payment of compensation are required for a land acquisition to lapse. This judgment reinforces the principles laid down in the Constitution Bench decision of Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129. It also reaffirms that subsequent purchasers do not have the locus standi to challenge land acquisition proceedings.

Conclusion

The Supreme Court allowed the appeal, setting aside the High Court’s decision. The Court held that the acquisition proceedings had not lapsed under Section 24(2) of the 2013 Act, as possession was taken and compensation was deposited in the Reference Court. The Court also held that the respondent had no locus standi to challenge the acquisition. The judgment clarifies the interpretation of Section 24(2) and reinforces the authority of the Constitution Bench decision in Indore Development Authority.