Supreme Court Upholds Land Acquisition: Delhi Development Authority vs. Shiv Raj & Ors. (2023)

Introduction

Date of the Judgment: April 19, 2023
Citation: 2023 INSC 396
Judges: M.R. Shah, J., Ahsanuddin Amanullah, J.

Can a land acquisition be deemed to have lapsed if the authorities have taken possession of the land but not paid the compensation? The Supreme Court of India recently addressed this question in a case between the Delhi Development Authority and several landowners. The core issue revolved 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 the conditions under which land acquisition proceedings can lapse. The judgment was delivered by a two-judge bench comprising Justice M.R. Shah and Justice Ahsanuddin Amanullah.

Case Background

The Delhi Development Authority (DDA) initiated land acquisition proceedings for a certain parcel of land. The DDA claimed that they had taken possession of the land on April 21, 2006. The landowners, however, contended that the acquisition had lapsed because they had not received compensation for their land. The case reached the High Court of Delhi, where the court ruled in favor of the landowners, stating that the acquisition had indeed lapsed due to non-payment of compensation, relying on a previous Supreme Court judgment. The DDA then appealed to the Supreme Court.

Timeline

Course of Proceedings

The High Court of Delhi, relying on the Supreme Court’s decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, ruled that the land acquisition had lapsed because compensation had not been paid to the landowners. However, the Supreme Court noted that the Pune Municipal Corporation judgment had been specifically overruled by a Constitution Bench of the Supreme Court in the case of Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129. This overruling was critical to the Supreme Court’s decision in the present case.

Legal Framework

The core legal provision at the heart of this case is Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (referred to as “Act, 2013”). This section deals with the lapse of land acquisition proceedings under certain conditions. The Supreme Court, in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, clarified the interpretation of this section. Specifically, the court held that the word “or” in Section 24(2) between possession and compensation 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. The relevant portion of the judgment in Indore Development Authority is as follows:

“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 other words, 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.”

Arguments

The Delhi Development Authority (DDA) argued that:

• They had taken possession of the land on April 21, 2006.
• The High Court’s decision was based on the overruled judgment of Pune Municipal Corporation.
• As per the ruling in Indore Development Authority, the acquisition could not lapse if possession had been taken, irrespective of whether compensation had been paid.

The landowners argued that:

• They had not received compensation for their land.
• The High Court correctly applied the law as it stood before the Indore Development Authority judgment.

Issues Framed by the Supreme Court

The Supreme Court considered the following issue:

1. Whether the High Court was correct in declaring that the acquisition with respect to the land in question is deemed to have lapsed under Section 24(2) of the Act, 2013.

Treatment of the Issue by the Court

Authorities

The Supreme Court considered the following authorities:

The Court also considered Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.

Judgment

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the fact that the High Court had relied on a judgment that had been specifically overruled by a Constitution Bench. The court emphasized the importance of following the precedent set in Indore Development Authority, which clarified that if possession of the land had been taken, the acquisition would not lapse even if compensation had not been paid. The court also noted that the DDA had taken possession of the land on April 21, 2006, which was a crucial factual aspect in its decision.

The Supreme Court’s reasoning was based on the interpretation of Section 24(2) of the Act, 2013, as clarified by the Constitution Bench in Indore Development Authority. The court rejected the High Court’s decision, stating that it was based on an overruled judgment. The court emphasized that once possession of the land had been taken, the acquisition could not be deemed to have lapsed, irrespective of whether compensation had been paid.

The Supreme Court stated:

“Applying the law laid down by this Court in the case of Indore Development Authority (supra) to the facts of the case on hand and the fact that the possession of the land in question was taken over on 21.04.2006, there shall not be any deemed lapse of acquisition as observed and held by the High Court.”

Key Takeaways

• Land acquisition proceedings do not lapse under Section 24(2) of the 2013 Act if possession of the land has been taken, even if compensation has not been paid.
• The word “or” in Section 24(2) between possession and compensation is to be read as “nor” or “and”.
• The judgment in Pune Municipal Corporation has been overruled by Indore Development Authority.
• High Courts and lower courts must follow the precedents set by the Constitution Bench of the Supreme Court.

Directions

The Supreme Court quashed and set aside the impugned judgment and order passed by the High Court. It declared that there shall not be any deemed lapse of acquisition with respect to the land in question.

Development of Law

The ratio decidendi of this case is that once possession of land is taken by the acquiring authority, the acquisition proceedings do not lapse under Section 24(2) of the 2013 Act, even if compensation has not been paid. This judgment reinforces the position of law established in Indore Development Authority and clarifies the interpretation of Section 24(2) of the 2013 Act. This case also highlights the importance of following the precedents set by the Constitution Bench of the Supreme Court and also overrules Pune Municipal Corporation.

Conclusion

In the case of Delhi Development Authority vs. Shiv Raj & Ors., the Supreme Court overturned the High Court’s decision, stating that the land acquisition had not lapsed. The Supreme Court emphasized that once possession of the land had been taken, the acquisition would not lapse, even if compensation had not been paid. The judgment reinforces the legal position established in Indore Development Authority and clarifies the interpretation of Section 24(2) of the 2013 Act. This decision has significant implications for land acquisition cases across India.