Supreme Court Overturns High Court on Land Acquisition Lapse: Govt. of NCT of Delhi vs. Dhannu (2023)

Date of the Judgment: February 17, 2023
Citation: Civil Appeal No. 942 of 2023 (@ SLP (C) No. 3116 of 2023) (@ Diary No. 28432 of 2022)
Judges: M.R. Shah, J., C.T. Ravikumar, J., Sanjay Karol, J.

Can a land acquisition be deemed to have lapsed if the land in question belongs to the Gram Sabha and not the original writ petitioner? The Supreme Court recently addressed this question, overturning a High Court decision that had declared a land acquisition lapsed. 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, specifically concerning whether the acquisition of land can lapse if possession is not taken or compensation is not paid. The judgment was delivered by a three-judge bench comprising Justices M.R. Shah, C.T. Ravikumar, and Sanjay Karol, with Justice M.R. Shah authoring the opinion.

Case Background

The case originated from a writ petition filed by Dhannu (now represented by his heirs) in the High Court of Delhi. Dhannu sought a declaration that the land acquisition concerning his property had lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (Act, 2013). The High Court, relying on a previous Supreme Court decision, ruled in favor of Dhannu, stating that the acquisition had indeed lapsed because the possession of the land was not taken. However, the Government of NCT of Delhi appealed this decision, arguing that the land belonged to the Gram Sabha, and thus, Dhannu had no right to claim a lapse in acquisition. It was also argued that the High Court had incorrectly applied the law.

Timeline

Course of Proceedings

The High Court of Delhi, in its judgment dated 16.11.2017, allowed the writ petition filed by Dhannu, declaring that the land acquisition had lapsed under Section 24(2) of the Act, 2013. The High Court based its decision on the precedent set by the Supreme Court in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183. The High Court did not delve into the question of ownership of the land, despite the appellant’s contention that the land belonged to the Gram Sabha. The Government of NCT of Delhi then appealed to the Supreme Court, challenging the High Court’s 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. This section deals with the lapse of land acquisition proceedings. It 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 the interpretation of this section in light of its previous judgments, particularly the overruling of Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183 by the Constitution Bench in Indore Development Authority versus Manoharlal and others, (2020) 8 SCC 129.

Arguments

Arguments of the Appellants (Government of NCT of Delhi):

• The primary argument was that the land in question belonged to the Gram Sabha. The original writ petitioner, Dhannu, had no locus standi to claim a lapse in acquisition under Section 24(2) of the Act, 2013, as he was not the recorded owner or even the owner of the land.
• 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 had been specifically overruled by the Constitution Bench in Indore Development Authority versus Manoharlal and others, (2020) 8 SCC 129.
• The appellants contended that the High Court should not have entertained the writ petition without first determining the ownership of the land.

Arguments of the Respondents (Dhannu’s Heirs):

• The respondents argued that the High Court correctly applied the law as it stood at the time of the judgment, relying on the decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183.
• They contended that since possession of the land had not been taken and compensation had not been paid, the acquisition proceedings had lapsed under Section 24(2) of the Act, 2013.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in a separate section. However, the main issues that the court addressed were:

1. Whether the High Court was correct in relying on the decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, which has been overruled.
2. Whether the original writ petitioner had the locus standi to claim a lapse in acquisition under Section 24(2) of the Act, 2013, when the land belonged to the Gram Sabha.
3. Whether the acquisition proceedings lapsed under Section 24(2) of the Act, 2013, given the facts of the case.

Treatment of the Issue by the Court

Authorities

The Supreme Court considered the following authorities:

The Supreme Court also considered the following legal provision:

• Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013: This section deals with the lapse of land acquisition proceedings if possession is not taken or compensation is not paid.

Judgment

How each authority was viewed by the Court?

• Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183: This case was explicitly overruled by the Constitution Bench in Indore Development Authority versus Manoharlal and others, (2020) 8 SCC 129. The Supreme Court noted that the High Court erred in relying on this overruled judgment.
• Indore Development Authority versus Manoharlal and others, (2020) 8 SCC 129: The Court relied on this Constitution Bench decision, which clarified the interpretation of Section 24(2) of the Act, 2013, and overruled Pune Municipal Corporation. The Court applied the principles laid down in this case to the facts of the present case.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily driven by the following considerations:

• The ownership of the land: The Court emphasized that the land belonged to the Gram Sabha, and the original writ petitioner had no legal right to claim a lapse in acquisition.
• The overruling of Pune Municipal Corporation: The Court noted that the High Court had incorrectly relied on a judgment that had been overruled by a Constitution Bench.
• The correct application of law: The Court stressed the importance of applying the correct legal principles, as clarified by the Constitution Bench in Indore Development Authority.

The Court’s reasoning was based on the following:

The Court rejected any alternative interpretations that would have allowed the writ petition, emphasizing that the correct legal principles and the facts of the case did not support the petitioner’s claim.

The Court’s decision was clear and concise: the High Court’s judgment was unsustainable because it relied on an overruled judgment and because the petitioner lacked locus standi. The Supreme Court emphasized the importance of proper legal standing and the application of the correct legal precedents.

The Supreme Court quoted the following from the judgment of Indore Development Authority versus Manoharlal and others, (2020) 8 SCC 129:

“The word “or” used in Section 24(2) between possession and compensation has to be read as “nor” or as “and”. 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.”

“In case a person has been tendered the compensation as provided under Section 31(1) of the 1894 Act, it is not open to him to claim that acquisition has lapsed under Section 24(2) due to non­payment or non­deposit of compensation in court. The obligation to pay is complete by tendering the amount under Section 31(1).”

“The provisions of Section 24(2) providing for a deemed lapse of proceedings are applicable in case authorities have failed due to their inaction to take possession and pay compensation for five years or more before the 2013 Act came into force, in a proceeding for land acquisition pending with the authority concerned as on 1­1­2014.”

There were no dissenting opinions in this case.

Key Takeaways

• A person who is not the recorded owner or the owner of the land cannot claim a lapse in land acquisition proceedings under Section 24(2) of the Act, 2013.
• High Courts must not rely on judgments that have been overruled by the Supreme Court.
• The interpretation of Section 24(2) of the Act, 2013, as clarified by the Constitution Bench in Indore Development Authority versus Manoharlal and others, (2020) 8 SCC 129, must be followed.
• The word “or” in Section 24(2) should be read as “nor” or “and.”

Directions

The Supreme Court quashed and set aside the impugned judgment and order passed by the High Court. The appeal was allowed with no costs.

Development of Law

The ratio decidendi of this case is that a person who is not the owner of the land cannot claim a lapse in land acquisition proceedings under Section 24(2) of the Act, 2013. This case reinforces the principles laid down by the Constitution Bench in Indore Development Authority versus Manoharlal and others, (2020) 8 SCC 129, and clarifies that the interpretation of Section 24(2) must be in accordance with the principles laid down in that case. This decision also emphasizes the importance of locus standi in legal proceedings and adherence to the correct legal precedents.

Conclusion

The Supreme Court’s decision in Govt. of NCT of Delhi vs. Dhannu overturns the High Court’s ruling, emphasizing that only the rightful owner of the land can claim a lapse in acquisition proceedings under Section 24(2) of the Act, 2013. The judgment reinforces the importance of applying the correct legal principles, as clarified by the Constitution Bench in Indore Development Authority, and highlights that reliance on overruled judgments is a fundamental error. This case serves as a reminder of the need for proper legal standing in court and the adherence to settled legal precedents.