LEGAL ISSUE: Whether land acquisition lapses under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 if possession is taken but compensation is not paid. CASE TYPE: Land Acquisition. Case Name: Govt. of NCT Delhi & Anr. vs. Dinesh Kumar & Anr. Judgment Date: 28 April 2023

Introduction

Date of the Judgment: 28 April 2023
Citation: 2023 INSC 467
Judges: M.R. Shah, J. and C.T. Ravikumar, J.

Can a land acquisition be deemed to have lapsed if the government takes possession of the land but fails to pay compensation? The Supreme Court of India recently addressed this crucial question in a case involving the Government of NCT of Delhi and a landowner. 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 (hereinafter referred to as “Act, 2013”), specifically whether both non-payment of compensation and non-taking of possession are necessary for a land acquisition to lapse. This judgment, delivered by a bench of Justices M.R. Shah and C.T. Ravikumar, clarifies the conditions under which a land acquisition can be deemed to have lapsed under the Act, 2013.

Case Background

The case originated from a writ petition filed in the High Court of Delhi by a landowner, Dinesh Kumar, against the Government of NCT of Delhi. The dispute centered around the acquisition of land by the government. The High Court ruled in favor of the landowner, stating that the acquisition had lapsed because the compensation had not been paid, even though the government claimed to have taken possession of the land. The Government of NCT of Delhi, aggrieved by the High Court’s decision, appealed to the Supreme Court.

The key point of contention was whether the acquisition of land should lapse under Section 24(2) of the Act, 2013. The government contended that possession of the land had been taken on 31 December 2013, before the Act, 2013 came into force on 1 January 2014. The landowner, however, argued that only a paper possession was taken, and the actual physical possession remained with him. The High Court sided with the landowner, stating that since compensation was not paid, the acquisition had lapsed.

Timeline

Date Event
31 December 2013 Government of NCT Delhi claims to have taken possession of the disputed land.
1 January 2014 The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 came into force.
2016 Dinesh Kumar filed a writ petition (Writ Petition (C) No. 4954 of 2016) in the High Court of Delhi.
Unknown The High Court of Delhi ruled that the land acquisition had lapsed.
28 April 2023 The Supreme Court of India overturned the High Court’s decision.

Course of Proceedings

The High Court of Delhi allowed the writ petition filed by the landowner, Dinesh Kumar, and declared that the acquisition of the land in question had lapsed under Section 24(2) of the Act, 2013. The High Court reasoned that since the compensation was not paid to the landowner, one of the two conditions required under Section 24(2) of the Act, 2013, was met, leading to the deemed lapse of the acquisition. The Government of NCT of Delhi then appealed this decision to the Supreme Court of India.

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Legal Framework

The core legal provision in this case is 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. According to the judgment, the relevant part of the section states:

“…where the physical possession of the land has not been taken or the compensation has not been paid the acquisition shall lapse.”

The Supreme Court has interpreted this section to mean that both conditions—not taking possession and not paying compensation—must be met for the acquisition to lapse. The court referred to its earlier decision in Indore Development Authority Vs. Manoharlal and Ors., [(2020) 8 SCC 129], which clarified that both conditions are conjunctive and not disjunctive. This means that if either possession has been taken or compensation has been paid, the acquisition does not lapse.

Arguments

Appellant (Govt. of NCT Delhi) Arguments:

  • The government argued that the possession of the disputed land was taken on 31 December 2013.
  • They contended that since the possession was taken before the Act, 2013 came into effect on 1 January 2014, there should be no deemed lapse of acquisition under Section 24(2) of the Act, 2013.
  • The government relied on the Supreme Court’s decision in Indore Development Authority Vs. Manoharlal and Ors., [(2020) 8 SCC 129], stating that both non-payment of compensation and non-taking of possession are required for the acquisition to lapse.

Respondent (Dinesh Kumar) Arguments:

  • The landowner argued that only a paper possession was taken by the government, and the actual physical possession remained with him.
  • He submitted that since the compensation was not paid, one of the conditions under Section 24(2) of the Act, 2013 was met, leading to the lapse of the acquisition.
  • He argued that the High Court was correct in holding that the acquisition had lapsed.
Main Submission Sub-Submissions by Appellant Sub-Submissions by Respondent
Whether the acquisition lapsed under Section 24(2) of the Act, 2013
  • Possession was taken on 31.12.2013.
  • Act, 2013 came into effect on 01.01.2014.
  • Both conditions of Section 24(2) must be met for lapse.
  • Only paper possession was taken.
  • Actual possession remained with the landowner.
  • Non-payment of compensation is sufficient for lapse.

Issues Framed by the Supreme Court

The primary issue before the Supreme Court was:

  1. Whether the acquisition of land lapses under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, if the possession of the land has been taken but the compensation has not been paid.

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues

Issue Court’s Decision Reason
Whether the acquisition of land lapses under Section 24(2) of the Act, 2013, if the possession of the land has been taken but the compensation has not been paid. No, the acquisition does not lapse. The Court held that Section 24(2) requires both conditions (non-payment of compensation AND non-taking of possession) to be met for the acquisition to lapse. Since possession was taken, the acquisition does not lapse even if compensation was not paid.

Authorities

The Supreme Court relied on the following authority:

Authority Court How it was used
Indore Development Authority Vs. Manoharlal and Ors., [(2020) 8 SCC 129] Supreme Court of India The Court followed this case, which held that for a deemed lapse under Section 24(2) of the Act, 2013, both conditions of not taking possession and not tendering/paying compensation must be satisfied.
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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, which deals with the lapse of land acquisition proceedings.

Judgment

How each submission made by the Parties was treated by the Court?

Submission Court’s Treatment
Appellant’s submission that possession was taken on 31.12.2013 and therefore the acquisition should not lapse. Accepted. The Court held that since possession was taken, the acquisition does not lapse under Section 24(2) of the Act, 2013.
Respondent’s submission that only paper possession was taken and compensation was not paid, thus the acquisition should lapse. Rejected. The Court held that both non-payment of compensation and non-taking of possession are required for the acquisition to lapse, as per Indore Development Authority Vs. Manoharlal and Ors., [(2020) 8 SCC 129]

How each authority was viewed by the Court?

  • The Supreme Court followed the decision in Indore Development Authority Vs. Manoharlal and Ors., [(2020) 8 SCC 129]. The Court reiterated that the decision in Indore Development Authority clarified the interpretation of Section 24(2) of the Act, 2013, holding that both conditions (non-payment of compensation and non-taking of possession) must be met for the acquisition to lapse.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the interpretation of Section 24(2) of the Act, 2013, and the precedent set in Indore Development Authority Vs. Manoharlal and Ors., [(2020) 8 SCC 129]. The Court emphasized that the language of the section requires both conditions—non-payment of compensation and non-taking of possession—to be satisfied for the acquisition to lapse. The Court found that since the possession was taken by the government, the acquisition could not be deemed to have lapsed, even though the compensation was not paid.

Sentiment Percentage
Emphasis on the conjunctive nature of Section 24(2) conditions 60%
Reliance on the precedent set by Indore Development Authority 40%
Category Percentage
Fact 30%
Law 70%

Logical Reasoning:

Issue: Does acquisition lapse under Section 24(2) if possession is taken but compensation is not paid?
↓
Section 24(2) requires BOTH non-payment of compensation AND non-taking of possession for lapse.
↓
Court notes that possession was taken on 31.12.2013.
↓
Precedent: Indore Development Authority held that both conditions must be met.
↓
Conclusion: Acquisition does not lapse because possession was taken, even if compensation was not paid.

The Court rejected the High Court’s interpretation, which had held that non-payment of compensation alone was sufficient for the acquisition to lapse. The Supreme Court clarified that the two conditions in Section 24(2) are conjunctive and not disjunctive. The court also emphasized that the mode of taking possession by drawing the punchnama was legal as per the decision in Indore Development Authority.

The Supreme Court quoted from the judgment:

“In the case of Indore Development Authority (supra), it is observed and held that for deemed lapse under Section 24(2) of the Act, 2013, twin conditions of not taking possession and not tendering/paying the compensation are required to be satisfied.”

“Therefore, if one of the two ingredients of Section 24(2) of the Act, 2013 is not met, there shall not be any deemed lapse of acquisition under Section 24(2) of the Act, 2013.”

“The aforesaid reasoning and the findings given by the High Court is just contrary to the law laid -down by this Court in the case of Indore Development Authority (supra).”

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Key Takeaways

  • For land acquisition to lapse under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, both conditions—non-taking of possession and non-payment of compensation—must be met.
  • If the government has taken possession of the land, the acquisition does not lapse even if compensation has not been paid.
  • The Supreme Court’s decision in Indore Development Authority Vs. Manoharlal and Ors., [(2020) 8 SCC 129], is the binding precedent on this issue.
  • The mode of taking possession by drawing the punchnama is a legal mode of taking possession.

Directions

The Supreme Court quashed and set aside the judgment and order passed by the High Court of Delhi. The appeal of the Government of NCT of Delhi was allowed.

Development of Law

The ratio decidendi of this case is that both the conditions, non-taking of possession and non-payment of compensation, must be met for a deemed lapse of acquisition under Section 24(2) of the Act, 2013. This judgment reinforces the position of law established in Indore Development Authority Vs. Manoharlal and Ors., [(2020) 8 SCC 129], and does not change the previous position of law.

Conclusion

The Supreme Court’s decision in Govt. of NCT Delhi vs. Dinesh Kumar clarifies that a land acquisition will not lapse under Section 24(2) of the Act, 2013, if possession has been taken, even if compensation has not been paid. This ruling reinforces the importance of the conjunctive nature of the conditions stipulated in Section 24(2) and reiterates the precedent set by the Supreme Court in Indore Development Authority Vs. Manoharlal and Ors., [(2020) 8 SCC 129]. The judgment underscores the need for both non-payment of compensation and non-taking of possession for the deemed lapse of land acquisition.

Category

Parent Category: Land Acquisition Law

  • Child Category: Section 24(2), Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013
  • Child Category: Deemed Lapse of Acquisition
  • 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(2), Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013

FAQ

Q: What does Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, say?

A: Section 24(2) of the Act, 2013, deals with the lapse of land acquisition proceedings. It states that if the physical possession of the land has not been taken or the compensation has not been paid, the acquisition shall lapse.

Q: What did the Supreme Court decide about Section 24(2)?

A: The Supreme Court clarified that both conditions—non-taking of possession and non-payment of compensation—must be met for the acquisition to lapse. If either possession has been taken or compensation has been paid, the acquisition does not lapse.

Q: What happens if the government has taken possession but not paid compensation?

A: According to the Supreme Court, if the government has taken possession of the land, the acquisition does not lapse, even if compensation has not been paid.

Q: What is the significance of the Indore Development Authority case?

A: The Supreme Court relied on the decision in Indore Development Authority Vs. Manoharlal and Ors., [(2020) 8 SCC 129], which clarified that both conditions of Section 24(2) are conjunctive and not disjunctive. This means both conditions must be met for the acquisition to lapse.

Q: What is the mode of taking possession?

A: The mode of taking possession by drawing the punchnama is a legal mode of taking possession as per the decision in Indore Development Authority.

Source: Govt. of NCT Delhi vs. Dinesh Kumar