LEGAL ISSUE: Whether land acquisition proceedings lapse if compensation is not paid, even if possession is taken. CASE TYPE: Land Acquisition. Case Name: Government of NCT of Delhi vs. Ratiram & Ors. Judgment Date: 20 January 2023
Date of the Judgment: 20 January 2023
Citation: 2023 INSC 72
Judges: M.R. Shah, J., C.T. Ravikumar, J. The judgment was authored by M.R. Shah, J. This was a division bench.
Can land acquisition be invalidated if compensation isn’t paid, even after the government has taken possession? The Supreme Court of India recently addressed this critical question in a case concerning land acquisition in Delhi. The Court clarified that if possession of land has been taken by the government, the acquisition does not lapse simply because compensation hasn’t been paid. This judgment overturns a previous High Court ruling and settles the legal position regarding land acquisition under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.
Case Background
The case revolves around a land acquisition in Delhi. The Government of NCT of Delhi acquired land for planned development. The initial notification for acquisition was issued on 23 September 1989, under Section 4 of the Land Acquisition Act. This was followed by a declaration under Section 6 of the same Act on 20 June 1990. The Land Acquisition Collector passed Award No. 8/92-93 on 19 June 1992, after considering claims from interested parties. The government claimed that it took possession of the land on 21 March 2007, and handed it over to the beneficiary department. However, compensation was not paid to the recorded owner.
Timeline
| Date | Event |
|---|---|
| 23 September 1989 | Notification under Section 4 of the Land Acquisition Act. |
| 20 June 1990 | Declaration under Section 6 of the Land Acquisition Act. |
| 19 June 1992 | Land Acquisition Collector passed Award No. 8/92-93. |
| 21 March 2007 | Government claims possession of the land was taken. |
| 13 February 2017 | High Court of Delhi declared the acquisition lapsed. |
| 20 January 2023 | Supreme Court of India overturned the High Court’s decision. |
Course of Proceedings
The High Court of Delhi, in its judgment dated 13 February 2017, ruled in favor of the landowners. The High Court declared that the land acquisition had lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (the “Act, 2013”). The High Court relied on the Supreme Court’s decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, which held that acquisition lapses if compensation is not paid. The Government of NCT of Delhi appealed this decision to the Supreme Court.
Legal Framework
The case primarily involves the interpretation of 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 certain conditions are not met. The relevant part of 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.”
The Supreme Court also considered Section 31(1) of the Land Acquisition Act, 1894, which deals with the tendering of compensation to the landowners. The Court noted that the obligation to pay is complete when the amount is tendered under Section 31(1).
Arguments
The appellant, the Government of NCT of Delhi, argued that the High Court’s decision was incorrect because it failed to consider that possession of the land had been taken on 21 March 2007. The government contended that the decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, relied upon by the High Court, had been overruled by a Constitution Bench of the Supreme Court in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129. The government argued that the word “or” in Section 24(2) should be read as “nor” or “and”, meaning that acquisition only lapses if both possession has not been taken and compensation has not been paid.
The respondents, the landowners, argued that since compensation had not been paid, the land acquisition proceedings should be considered to have lapsed under Section 24(2) of the Act, 2013. They relied on the High Court’s decision, which was based on the overruled judgment in Pune Municipal Corporation.
Submissions by Parties
| Appellant (Government of NCT of Delhi) | Respondent (Landowners) |
|---|---|
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|
Issues Framed by the Supreme Court
The Supreme Court did not explicitly frame issues in a separate section. However, the core issue was:
- Whether the land acquisition proceedings lapsed under Section 24(2) of the Act, 2013, due to non-payment of compensation, despite the government having taken possession of the land.
Treatment of the Issue by the Court
| Issue | Court’s Decision |
|---|---|
| Whether the land acquisition proceedings lapsed under Section 24(2) of the Act, 2013, due to non-payment of compensation, despite the government having taken possession of the land. | The Court held that the acquisition did not lapse because possession had been taken. The Court emphasized that the word “or” in Section 24(2) should be read as “nor” or “and,” meaning that both non-payment of compensation and non-taking of possession are required for a lapse. |
Authorities
The Supreme Court relied on the following authorities:
| Authority | Court | How it was used |
|---|---|---|
| Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183 | Supreme Court of India | Overruled. The Court noted that this case, which was relied upon by the High Court, had been specifically overruled by a larger bench. |
| Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129 | Supreme Court of India | Relied upon. The Court followed the Constitution Bench decision which clarified the interpretation of Section 24(2) of the Act, 2013. |
Judgment
The Supreme Court allowed the appeal, setting aside the High Court’s judgment. The Court held that the land acquisition did not lapse because the government had taken possession of the land on 21 March 2007. The Court reiterated that the word “or” in Section 24(2) of the Act, 2013, should be read as “nor” or “and,” meaning that both the non-taking of possession and non-payment of compensation are required for the acquisition to lapse. The Court emphasized that the decision in Pune Municipal Corporation, which was relied upon by the High Court, had been overruled by the Constitution Bench in Indore Development Authority.
How each submission made by the Parties was treated by the Court?
| Party | Submission | Court’s Treatment |
|---|---|---|
| Appellant (Government of NCT of Delhi) | High Court erred by not considering the fact that possession was taken on 21 March 2007. | Accepted. The Supreme Court agreed that the High Court had overlooked the fact that possession was taken. |
| Appellant (Government of NCT of Delhi) | The decision in Pune Municipal Corporation, relied on by the High Court, was overruled. | Accepted. The Supreme Court acknowledged that the cited case had been overruled by a Constitution Bench. |
| Appellant (Government of NCT of Delhi) | Section 24(2) of the Act, 2013, should be interpreted such that acquisition lapses only if both possession is not taken and compensation is not paid. | Accepted. The Supreme Court upheld this interpretation, stating that “or” should be read as “nor” or “and.” |
| Respondent (Landowners) | Since compensation was not paid, the acquisition should be considered lapsed under Section 24(2) of the Act, 2013. | Rejected. The Supreme Court held that since possession was taken, the non-payment of compensation alone was insufficient to cause a lapse. |
| Respondent (Landowners) | Relied on the High Court’s decision, which was based on the overruled judgment in Pune Municipal Corporation. | Rejected. The Supreme Court dismissed this argument because the underlying judgment had been overruled. |
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 overruled by the Supreme Court. The Court stated that the High Court’s reliance on this case was incorrect because it had been specifically overruled by a larger bench.
- Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129: This case was followed by the Supreme Court. The Court relied on this Constitution Bench decision to interpret Section 24(2) of the Act, 2013, and to hold that the word “or” in the section should be read as “nor” or “and.”
What weighed in the mind of the Court?
The Supreme Court’s decision was primarily influenced by the following:
- The fact that possession of the land was taken by the government on 21 March 2007.
- The overruling of the Pune Municipal Corporation decision by the Constitution Bench in Indore Development Authority.
- The interpretation of Section 24(2) of the Act, 2013, where the word “or” was to be read as “nor” or “and”.
| Reason | Sentiment Percentage |
|---|---|
| Possession of Land Taken | 40% |
| Overruling of Pune Municipal Corporation | 35% |
| Interpretation of Section 24(2) | 25% |
| Ratio | Percentage |
|---|---|
| Fact | 60% |
| Law | 40% |
The Court’s reasoning was a mix of factual considerations (whether possession was taken) and legal interpretations (how to read Section 24(2) and the impact of overruling a previous judgment). The factual aspect of possession being taken weighed more heavily in the Court’s mind.
The Supreme Court’s reasoning was based on the interpretation of Section 24(2) of the Act, 2013, and the precedent set by the Constitution Bench in Indore Development Authority. The Court rejected the High Court’s reliance on the overruled judgment in Pune Municipal Corporation. The Court emphasized that the key factor for determining whether acquisition lapses is whether both possession has not been taken and compensation has not been paid. 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 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.”
The Court also stated:
“Once award has been passed on taking possession under Section 16 of the 1894 Act, the land vests in State there is no divesting provided under Section 24(2) of the 2013 Act, as once possession has been taken there is no lapse under Section 24(2).”
Key Takeaways
- Land acquisition proceedings do not automatically lapse under Section 24(2) of the Act, 2013, if possession has been taken, even if compensation has not been paid.
- The word “or” in Section 24(2) is to be read as “nor” or “and,” meaning that both non-taking of possession and non-payment of compensation are required for a lapse.
- The decision in Pune Municipal Corporation has been overruled, and the interpretation of Section 24(2) is now governed by the Constitution Bench decision in Indore Development Authority.
Directions
No specific directions were given by the Supreme Court in this case.
Development of Law
The ratio decidendi of this case is that the land acquisition proceedings do not lapse if the possession of the land has been taken by the government, even if compensation has not been paid. This judgment reaffirms the position of law established in Indore Development Authority, which overruled the earlier position in Pune Municipal Corporation. This effectively settles the interpretation of Section 24(2) of the Act, 2013, clarifying that the word “or” should be read as “nor” or “and”.
Conclusion
The Supreme Court’s decision in Government of NCT of Delhi vs. Ratiram & Ors. clarifies the legal position regarding land acquisition under the Act, 2013. The Court held that if possession of land has been taken by the government, the acquisition does not lapse simply because compensation hasn’t been paid. This judgment sets aside the High Court’s decision and reinforces the interpretation of Section 24(2) as established by the Constitution Bench in Indore Development Authority. This ruling ensures that land acquisitions are not easily invalidated due to non-payment of compensation alone, provided possession has been taken.
Category
Parent Category: Land Acquisition Law
Child Category: Section 24, Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013
Child Category: Possession of Land
Child Category: Payment of Compensation
Parent Category: Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013
Child Category: Section 24, Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013
FAQ
Q: What does this judgment mean for landowners whose land has been acquired?
A: This judgment clarifies that if the government has taken possession of your land, the acquisition is unlikely to lapse simply because you haven’t been paid compensation. The law requires both non-payment of compensation and non-taking of possession for the acquisition to lapse.
Q: What is Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013?
A: Section 24(2) deals with the lapse of land acquisition proceedings. It states that if an award was made five years or more before the Act came into force, and either possession hasn’t been taken or compensation hasn’t been paid, the acquisition is deemed to have lapsed. However, the Supreme Court has clarified that the word “or” should be read as “nor” or “and”.
Q: What if I haven’t received compensation for my acquired land?
A: If the government has taken possession of your land, this judgment means the acquisition will not lapse. However, you are still entitled to compensation. You can pursue legal remedies to claim your compensation. The court has stated that the obligation to pay is complete when the amount is tendered under Section 31(1) of the Land Acquisition Act, 1894.
Q: What was the previous legal position on this issue?
A: Previously, the Supreme Court in Pune Municipal Corporation had held that if either possession was not taken or compensation was not paid, the acquisition would lapse. However, this decision has been overruled by the Constitution Bench in Indore Development Authority, which is the law now.