Supreme Court Upholds Land Acquisition: Assam Industrial Development Corporation Ltd. vs. Gillapukri Tea Company Limited (28 January 2021)

Introduction

Date of the Judgment: 28 January 2021
Citation: 2021 INSC 41
Judges: S. Abdul Nazeer, J. and Sanjiv Khanna, J.

Can a land acquisition be nullified if the acquiring authority initiates a fresh acquisition process for the same land? The Supreme Court of India recently addressed this question in a case concerning the acquisition of land for a plastic park in Assam. The core issue was whether the State Government had validly approved an initial land acquisition award, and whether subsequent actions by the government could negate the initial acquisition. This case highlights the importance of adhering to established procedures in land acquisition and the implications for both landowners and acquiring agencies. The judgment was delivered by a two-judge bench comprising Justice S. Abdul Nazeer and Justice Sanjiv Khanna, with Justice S. Abdul Nazeer authoring the opinion.

Case Background

The Government of Assam decided to acquire land belonging to Gillapukri Tea Company Limited for the establishment of a plastic park. On 04 August 2008, a notification under Section 4 of the Land Acquisition Act, 1894, was issued, indicating the government’s intention to acquire 1,166 bighas, 1 katha, and 14 lessas of land. Subsequently, on 17 June 2009, a declaration under Section 6(1) of the Land Acquisition Act was published. The Assam Industrial Development Corporation Ltd. was appointed as the nodal agency for the acquisition.

The Deputy Commissioner of Tinsukia sought approval for the award and land acquisition estimate from the Principal Secretary to the Government of Assam on 30 January 2010. The Commissioner and Secretary approved the estimate on 05 March 2010. The landowner, Gillapukri Tea Company Limited, applied for a reference to the District Judge for reassessment of compensation on 05 May 2010, acknowledging receipt of Rs. 4.95 crores on 08 April 2010. Possession of the land was handed over to the Deputy Commissioner on 21 May 2010, and subsequently to the Assam Industrial Development Corporation Ltd. on 11 June 2010.

The tea company contested the validity of the initial award, claiming that only the land acquisition estimate was approved on 05 March 2010, and not the award itself. They argued that this led to the lapsing of the initial proceedings, necessitating fresh acquisition proceedings in 2012. A fresh notification under Section 4 of the Land Acquisition Act was issued on 07 August 2012, followed by a declaration on 20 November 2012, and a fresh award was passed on 04 January 2014. The tea company then sought compensation under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.

The State Government contended that the award was indeed approved on 05 March 2010, and that the second award was only to include landowners who were initially left out.

Timeline

Legal Framework

The primary legal framework for this case is the Land Acquisition Act, 1894. Key provisions include:

• Section 4: This section deals with the publication of a preliminary notification indicating the government’s intention to acquire land for a public purpose.
• Section 6: This section pertains to the declaration of the government’s intention to acquire land after considering objections to the preliminary notification.
• Section 9: This section deals with the issuance of notice to persons interested in the land to submit their objections and claims.
• Section 18: This section allows a person who has not accepted the award to apply for a reference to the court for determination of the compensation.

The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, was also relevant, as the first respondent sought compensation under this Act, arguing that the initial acquisition proceedings had lapsed.

Arguments

Appellant’s Arguments (Assam Industrial Development Corporation Ltd.):

• The award was approved by the State on 05 March 2010, as evidenced by the approval of the land acquisition estimate and the subsequent actions of the parties.
• Possession of the land was handed over by the first respondent on 21 May 2010, and then to the appellant on 11 June 2010.
• The first respondent received compensation and even sought enhancement under Section 18 of the Land Acquisition Act, 1894.
• Once the land vested in the State, it could not be re-acquired, making the subsequent notification under Section 4 and 6 and the fresh award non est.

Respondent’s Arguments (Gillapukri Tea Company Limited):

• The letter dated 05 March 2010, only approved the land acquisition estimate, not the award.
• The letters dated 21 July 2012, and 06 January 2014, show that no award had been approved under the original acquisition proceedings.
• The original acquisition proceedings had lapsed due to non-approval of the award within two years of the declaration.
• The fresh award was made after the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, came into force, entitling them to compensation under that Act.

The innovativeness of the argument of the respondent was that it was able to convince the High Court that the letter dated 05 March 2010 did not approve the award, but only the estimate.

Issues Framed by the Supreme Court

The Supreme Court framed the following crucial issue for consideration:

1. Whether an award in respect of the first respondent’s land was approved by the State Government on 05.03.2010.

Treatment of the Issue by the Court

Authorities

The Supreme Court considered the following authorities:

Judgment

How each authority was viewed by the Court?

• The Supreme Court relied on D. Hanumanth SA & Ors. v. State of Karnataka and Ors. [ (2010) 10 SCC 656 ]* to affirm that once land is acquired by the government, it cannot be acquired again.
• The Court also cited State of Orissa v. Brundaban Sharma [ 1995 Supp (3) SCC 249 ]* and Meher Rusi Dalal v. Union of India [ (2004) 7 SCC 362 ]* to reiterate that the government cannot acquire its own interest in land.
• The Court referred to Collector of Bombay v. Nusserwanji Rattanji Mistri [ AIR 1955 SC 298 : (1955) 1 SCR 1311 ]* for the principle that in land acquisition proceedings, the government cannot and does not acquire its own interest.
• The Constitution Bench decision in Indore Development Authority v. Manoharlal and Ors. [ (2020) 8 SCC 129 ]* was used to support the view that once the possession of land was taken by the State, the land vests absolutely with the State.

What weighed in the mind of the Court?

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

• The combined reading of the letters dated 30 January 2010 and 05 March 2010, which indicated that the award was approved along with the land acquisition estimate.
• The subsequent conduct of the parties, including the receipt of compensation by the first respondent, the handover of possession, and the first respondent’s application for reassessment of compensation, all of which suggested that the award had been approved.
• The legal principle that once land is acquired and vested in the government, it cannot be re-acquired.
• The fact that the plastic project had already been developed on the acquired land.

The court’s reasoning was based on a combination of factual analysis and legal principles. The court emphasized the importance of the conduct of the parties after the letter dated 05 March 2010, which clearly indicated that all parties believed that the award had been approved.

The court rejected the argument that the letter dated 05 March 2010, only approved the estimate and not the award. The court reasoned that the award was in the prescribed form and was sent along with the estimate for approval. The court also rejected the argument that the original proceedings had lapsed, as the award was approved on 05 March 2010.

The court quoted the following from the judgment:

• “It is pertinent to note that the award was in the format of Form No. 15 which is the statutorily prescribed form for a land acquisition award under the Assam Land Acquisition Manual.”
• “What clearly emerges from the above is that after the letter dated 05.03.2010, it was the common belief of the State Government, the appellant as well as the first respondent that the award had been approved and that now actions subsequent thereto viz. payment and receipt of compensation, handover of possession, seeking reassessment of the compensation were needed to be undertaken.”
• “The recent decision of the Constitution Bench of this Court in Indore Development Authority v. Manoharlal and Ors. has also affirmed that once possession is taken by the State, the land vests absolutely with the State and the title of the landowner ceases.”

Key Takeaways

The practical implications of this judgment are:

• Land acquisition awards, once approved by the government, cannot be easily challenged if there is clear evidence of approval and subsequent conduct of the parties.
• Once land is vested in the government after acquisition, it cannot be re-acquired through fresh proceedings.
• The conduct of the parties after the approval of an award is critical in determining its validity.
• Landowners who have received compensation and handed over possession of their land cannot later claim compensation under new land acquisition laws by arguing that the initial acquisition was invalid.
• Acquiring authorities must ensure that all procedures are followed correctly and that there is clear documentation of the approval of the award.

Directions

The Supreme Court set aside the orders of the High Court and allowed the appeals. The parties were directed to bear their own costs.

Development of Law

The ratio decidendi of this case is that once an award for land acquisition is approved by the government, and possession of the land is taken, the land vests absolutely with the government, and the title of the landowner ceases. Fresh acquisition proceedings for the same land are invalid. This judgment reinforces the principle that the government cannot acquire its own land and that subsequent actions by the parties are crucial in determining the validity of the award. There is no change in the previous position of law.

Conclusion

In conclusion, the Supreme Court held that the land acquisition award was validly approved on 05 March 2010, based on the combined reading of the letters and the subsequent conduct of the parties. The Court set aside the High Court’s order and upheld the acquisition of land by the Assam Industrial Development Corporation Ltd. The judgment reinforces the principle that once land is acquired and vested in the government, it cannot be re-acquired.