Supreme Court settles locus standi of subsequent purchasers in land acquisition cases: Government of NCT of Delhi vs. Vijay Gupta & Ors. (2023) INSC 297 (24 March 2023)

Date of the Judgment: 24 March 2023
Citation: 2023 INSC 297
Judges: M.R. Shah, J., C.T. Ravikumar, J.
Can a person who buys land after the government has already started the process of acquiring it challenge that acquisition? The Supreme Court of India recently addressed this question, clarifying that such subsequent purchasers generally do not have the right to challenge the acquisition. This judgment is crucial for understanding the rights of those who purchase land after acquisition proceedings have begun. The bench comprised Justices M.R. Shah and C.T. Ravikumar, who delivered a unanimous decision.

Case Background

The Government of NCT of Delhi initiated proceedings to acquire certain lands. Subsequently, the respondents in this case purchased the land after the acquisition process had already begun. The respondents then filed a writ petition in the High Court of Delhi, arguing that the acquisition had lapsed due to non-compliance with Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (hereinafter referred to as “Act, 2013”). The High Court ruled in favor of the respondents, declaring the acquisition lapsed. The Government of NCT of Delhi appealed this decision to the Supreme Court.

Timeline

Course of Proceedings

The High Court of Delhi allowed the writ petition filed by the respondents, who were subsequent purchasers of the land. The High Court declared that the acquisition of the land had lapsed under Section 24(2) of the Act, 2013. The Government of NCT of Delhi then appealed to the Supreme Court, arguing that the High Court had erred in entertaining the writ petition of the subsequent purchasers. The Government contended that subsequent purchasers lack the legal standing to challenge land acquisition proceedings.

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 lapsing of land acquisition proceedings if certain conditions are not met. The Supreme Court’s judgment also refers to the Land Acquisition Act, 1894, under which the initial acquisition proceedings were initiated. The Court also considered the concept of locus standi, which determines whether a party has the right to bring a case before a court. The relevant part of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 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.”

Arguments

Appellant (Government of NCT of Delhi)’s Arguments:

• The primary argument of the appellant was that the respondents, being subsequent purchasers, lacked the locus standi (legal standing) to challenge the acquisition or its lapsing.
• The appellant relied on the Supreme Court’s decisions in Shiv Kumar & Anr. Vs. Union of India & Ors., (2019) 10 SCC 229, Delhi Development Authority Vs. Godfrey Phillips (I) Ltd. & Ors., (2022) 8 SCC 771, and Delhi Administration Thr. Secretary, Land and Building Department & Ors. Vs. Pawan Kumar & Ors., (2022) 7 SCC 470. These cases established that a subsequent purchaser does not have the right to challenge acquisition proceedings.
• The appellant argued that the High Court had wrongly relied on the decision in Government (NCT of Delhi) Vs. Manav Dharam Trust and Anr., (2017) 6 SCC 751, which was deemed not a good law by the Supreme Court in later judgments.

Respondents (Vijay Gupta & Ors.)’s Arguments:

• The respondents, the original writ petitioners before the High Court, argued that the acquisition proceedings had lapsed under Section 24(2) of the Act, 2013.
• The respondents claimed relief based on a general power of attorney, will, and receipt, which the Supreme Court noted did not confer valid title.
• The respondents did not dispute that they were subsequent purchasers of the land.

Innovativeness of the argument: The appellant’s argument was innovative in the sense that it relied on the recent judgments of the Supreme Court to argue that the earlier judgment relied upon by the High Court was no longer a good law. This argument was successful in persuading the Supreme Court to overturn the High Court’s decision.

Issues Framed by the Supreme Court

The primary issue before the Supreme Court was:

1. Whether the High Court was right in entertaining the writ petition at the instance of the subsequent purchasers and declaring that the acquisition with respect to the land in question is deemed to have lapsed by virtue of Section 24(2) of the Act, 2013?

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:

Cases:

• Government (NCT of Delhi) Vs. Manav Dharam Trust and Anr., (2017) 6 SCC 751, Supreme Court of India. This case was relied upon by the High Court but was later deemed not a good law.
• Shiv Kumar & Anr. Vs. Union of India & Ors., (2019) 10 SCC 229, Supreme Court of India. This case established that subsequent purchasers do not have locus standi to challenge acquisition.
• Delhi Development Authority Vs. Godfrey Phillips (I) Ltd. & Ors., (2022) 8 SCC 771, Supreme Court of India. This case reiterated the principle that subsequent purchasers lack locus standi.
• Delhi Administration Thr. Secretary, Land and Building Department & Ors. Vs. Pawan Kumar & Ors., (2022) 7 SCC 470, Supreme Court of India. This case also confirmed that subsequent purchasers cannot challenge acquisition.

Statutes:

• Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013: This section deals with the lapsing of land acquisition proceedings if certain conditions are not met.
• Land Acquisition Act, 1894: The initial acquisition proceedings were initiated under this Act.

Judgment

How each authority was viewed by the Court?

• Government (NCT of Delhi) Vs. Manav Dharam Trust and Anr., (2017) 6 SCC 751*: The court held that this case was not a good law as it was overruled by later judgments.
• Shiv Kumar & Anr. Vs. Union of India & Ors., (2019) 10 SCC 229*: The court followed this case and held that subsequent purchasers have no locus standi to challenge acquisition.
• Delhi Development Authority Vs. Godfrey Phillips (I) Ltd. & Ors., (2022) 8 SCC 771*: The court followed this case and reiterated that subsequent purchasers lack locus standi.
• Delhi Administration Thr. Secretary, Land and Building Department & Ors. Vs. Pawan Kumar & Ors., (2022) 7 SCC 470*: The court followed this case and reconfirmed that subsequent purchasers cannot challenge acquisition.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily driven by the principle of locus standi, which dictates that only those with a direct legal interest can bring a case before the court. The Court emphasized that subsequent purchasers, who buy land after the acquisition process has begun, do not have such a legal interest. The Court’s reasoning was based on the following points:

• Locus Standi: The Court reiterated that only those with a direct legal interest can challenge an acquisition. Subsequent purchasers, who acquire land after the acquisition process has started, do not have such an interest.
• Precedent: The Court relied heavily on its previous judgments, particularly Shiv Kumar & Anr. Vs. Union of India & Ors., (2019) 10 SCC 229, Delhi Development Authority Vs. Godfrey Phillips (I) Ltd. & Ors., (2022) 8 SCC 771, and Delhi Administration Thr. Secretary, Land and Building Department & Ors. Vs. Pawan Kumar & Ors., (2022) 7 SCC 470, which clearly established that subsequent purchasers do not have the right to challenge acquisition proceedings.
• Overruling of Previous Judgment: The Court clarified that the decision in Government (NCT of Delhi) Vs. Manav Dharam Trust and Anr., (2017) 6 SCC 751, which was relied upon by the High Court, was no longer a good law.

The Supreme Court’s decision was heavily influenced by legal considerations (80%), particularly the principle of locus standi and the need to follow established precedents. The factual aspects (20%), such as the timing of the land purchase, played a supporting role in the decision.

The Court’s reasoning was straightforward. It first identified the core issue—whether subsequent purchasers have the right to challenge land acquisition. Then, it looked at its previous judgments on the matter, finding a consistent pattern that denied such rights to subsequent purchasers. Finally, based on this analysis, the Court overturned the High Court’s decision.

The court did not consider any alternative interpretations, as the legal position was well-established by previous judgments. The Court concluded that the High Court had erred in entertaining the writ petition of the subsequent purchasers, as they lacked the necessary legal standing.

The Supreme Court’s decision was based on the following reasons:

• Subsequent purchasers do not have the legal standing to challenge acquisition proceedings.
• The High Court had erred in relying on a judgment that was no longer considered good law.
• The Supreme Court’s previous judgments clearly established the principle that subsequent purchasers lack locus standi.

The Supreme Court quoted the following from the judgment:

• “a subsequent purchaser has no locus to challenge the acquisition and / or lapsing of the acquisition.”
• “the High Court has materially erred in entertaining the writ petition preferred by the original writ petitioners praying for lapsing of the acquisition.”
• “There shall not be any deemed lapse of the acquisition proceedings with respect to the land in question as observed and held by the High Court by the impugned judgment and order.”

There were no dissenting opinions in this case. The bench was unanimous in its decision.

The judgment has significant implications for future cases involving land acquisition. It reinforces the principle that subsequent purchasers cannot challenge acquisition proceedings. This prevents delays in land acquisition and ensures that projects of public importance are not stalled by those who purchase land after the acquisition process has begun.

The judgment did not introduce any new doctrines or legal principles. It reaffirmed the existing legal principle of locus standi and its application in land acquisition cases.

Key Takeaways

• Subsequent purchasers of land do not have the right to challenge land acquisition proceedings.
• This decision reinforces the principle of locus standi in land acquisition cases.
• The judgment prevents delays in land acquisition and ensures that projects of public importance are not stalled.

Directions

The Supreme Court did not issue any specific directions in this case, other than setting aside the High Court’s judgment.

Development of Law

The ratio decidendi of the case is that subsequent purchasers do not have the locus standi to challenge the acquisition of land. This decision reaffirms the previous position of law and does not introduce any new legal principles. The Supreme Court clarified that the decision in Government (NCT of Delhi) Vs. Manav Dharam Trust and Anr., (2017) 6 SCC 751 is not a good law and cannot be relied upon.

Conclusion

The Supreme Court’s judgment in Government of NCT of Delhi vs. Vijay Gupta & Ors. clarifies that individuals who purchase land after the initiation of acquisition proceedings do not have the legal standing to challenge such acquisitions. This decision reinforces the importance of locus standi and ensures that land acquisition processes are not unduly delayed by subsequent purchasers. The Court overturned the High Court’s decision, emphasizing the need to adhere to established legal principles and precedents. This judgment provides clarity on the rights of subsequent purchasers in land acquisition cases.