Supreme Court Upholds Land Acquisition: Govt. of NCT of Delhi vs. Sushil Kumar Gupta (2023)

Introduction

Date of the Judgment: 10 February 2023

Citation: 2023 INSC 109

Judges: M.R. Shah, J. and C.T. Ravikumar, J.

Can land acquisition proceedings be deemed to have lapsed if the government has taken possession of the land but has not paid compensation? The Supreme Court of India recently addressed this question, clarifying the interpretation of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. This judgment is crucial for understanding the conditions under which land acquisition can lapse. The bench consisted of Justice M.R. Shah and Justice C.T. Ravikumar, with the judgment authored by Justice M.R. Shah.

Case Background

The Government of NCT of Delhi initiated land acquisition proceedings. The possession of the land in question was taken on 12 March 1981. The High Court of Delhi, relying on a previous Supreme Court decision, had ruled that the acquisition had lapsed because compensation had not been paid. The Government of NCT of Delhi appealed this decision, arguing that the High Court’s ruling was incorrect in light of a later Supreme Court judgment.

Timeline

Course of Proceedings

The High Court of Delhi had allowed the writ petition filed by the respondents, declaring that the land acquisition proceedings had lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The High Court based its decision on the Supreme Court’s ruling in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., [(2014) 3 SCC 183], which stated that if compensation was not paid, the acquisition would lapse. The Government of NCT of Delhi then appealed to the Supreme Court, challenging the High Court’s decision.

Legal Framework

The key 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 if certain conditions are not met. The section states:

“24. (2) 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:
Provided that where an award has been made and compensation in respect of a majority of land holdings has not been deposited in the account of the beneficiaries, then, all beneficiaries specified in the notification for acquisition under section 4 of the said Land Acquisition Act, shall be entitled to compensation in accordance with the provisions of this Act.”

The Supreme Court had to interpret whether the word “or” in the phrase “possession has not been taken or the compensation has not been paid” should be read as “and” or “nor”.

Arguments

The Government of NCT of Delhi argued that the High Court’s decision was incorrect because the Supreme Court had overruled the case of Pune Municipal Corporation (supra) in the case of Indore Development Authority Vs. Manoharlal and Ors., [(2020) 8 SCC 129]. They contended that the Constitution Bench in Indore Development Authority (supra) had clarified that the word “or” in Section 24(2) should be read as “nor” or “and”. This means that for the acquisition to lapse, both possession must not be taken and compensation must not be paid. Since possession was taken in 1981, the acquisition could not be deemed to have lapsed.

The respondents, on the other hand, argued that the acquisition had lapsed because compensation had not been paid, relying on the interpretation of Section 24(2) in Pune Municipal Corporation (supra).

Issues Framed by the Supreme Court

The primary issue before the Supreme Court was:

1. Whether the land acquisition proceedings in respect of the land in question is deemed to have lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.

Treatment of the Issue by the Court

Authorities

Judgment

The Supreme Court overturned the High Court’s decision. The Court emphasized that the Constitution Bench in Indore Development Authority (supra) had clarified that the word “or” in Section 24(2) must be read as “nor” or “and”. Therefore, the acquisition would only lapse if both possession was not taken and compensation was not paid. In this case, possession was taken on 12 March 1981, so the acquisition did not lapse.

The Supreme Court observed that:
“Thus, as per the law laid down by this Court for the purpose of lapsing the acquisition under Section 24(2) of the Act, 2013, the twin conditions namely, not taking the possession and not paying the compensation have to be satisfied and if one of the conditions is not satisfied there shall not be any lapse of the acquisition.”

The Court further stated:
“Therefore, once the possession of the land in question was taken over on 12.03.1981 then applying the law laid down by this Court in the case of Indore Development Authority (supra) the acquisition of the land in question is not deemed to have lapsed under Section 24(2) of the Act, 2013.”

The Court concluded:
“In view of the above and for the reasons stated above, the present appeal succeeds. The impugned judgment and order passed by the High Court is hereby quashed and set aside. Consequently, the writ petition preferred by the original writ petitioner before the High Court stands dismissed.”

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 2013 Act as clarified by the Constitution Bench in Indore Development Authority (supra). The Court emphasized that the word “or” in the section should be read as “nor” or “and,” requiring both non-possession and non-payment of compensation for the acquisition to lapse. The court’s reasoning was heavily based on the legal interpretation of the statute and the overruling of the previous judgment in Pune Municipal Corporation (supra). The court also highlighted the factual aspect of the case that possession was taken in 1981.

Logical Reasoning

Key Takeaways

• ✓ Land acquisition proceedings will 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) must be interpreted as “nor” or “and,” meaning both non-possession and non-payment of compensation are required for the acquisition to lapse.
• ✓ The decision in Pune Municipal Corporation (supra) has been overruled, and the interpretation in Indore Development Authority (supra) is now the binding precedent.

Directions

The Supreme Court quashed the High Court’s judgment and dismissed the writ petition filed by the original writ petitioner. No further directions were given.

Development of Law

The ratio decidendi of this case is that for land acquisition proceedings to lapse under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, both possession must not have been taken and compensation must not have been paid. This judgment clarifies the interpretation of Section 24(2), overturning the previous position of law established in Pune Municipal Corporation (supra). The Supreme Court has reinforced the interpretation given by the Constitution Bench in Indore Development Authority (supra), which is now the binding precedent.

Conclusion

The Supreme Court’s judgment in Govt. of NCT of Delhi vs. Sushil Kumar Gupta & Ors. clarifies that land acquisition proceedings do not lapse under Section 24(2) of the 2013 Act if possession has been taken, even if compensation has not been paid. The Court’s decision reinforces the interpretation of Section 24(2) established in Indore Development Authority (supra), overruling the earlier stance in Pune Municipal Corporation (supra). This ruling provides clarity on the conditions for the lapse of land acquisition proceedings.