Supreme Court Upholds Land Acquisition, Grants Enhanced Compensation: Noida vs. Ravindra Kumar (2022)

Date of the Judgment: 9 May 2022

Citation: (2022) INSC 437

Judges: Ajay Rastogi, J., Abhay S. Oka, J.

Can a land acquisition be upheld even if the urgency clause was illegally invoked? The Supreme Court of India recently addressed this complex question in a batch of appeals concerning land acquired by the Noida Industrial Development Authority (NOIDA). The core issue revolved around the legality of invoking the urgency clause under the Land Acquisition Act, 1894, and the subsequent determination of fair compensation for landowners. The judgment was delivered by a two-judge bench of Justices Ajay Rastogi and Abhay S. Oka, with the opinion authored by Justice Abhay S. Oka.

Case Background

The case originates from a land acquisition notification issued by the State Government on 7th November 2007, under Section 4 of the Land Acquisition Act, 1894. The notification aimed to acquire 108.233 hectares of land in Village Begumpur for planned industrial development by NOIDA. The State Government invoked the urgency clause under Section 17(1) of the 1894 Act, dispensing with the inquiry under Section 5A. A declaration under Section 6 was issued on 17th March 2008. Possession of 7.559 hectares was taken on 7th June 2008, and the remaining 100.64 hectares on 15th June 2013. Two awards were made on 12th January 2011 and 31st December 2013, respectively, offering different compensation rates based on whether landowners agreed to the Uttar Pradesh (Determination of Compensation and Declaration of Award by Agreement) Rules, 1997 (Karar Niyamawali). Those who agreed received higher compensation, while others were offered a lower market value with solatium and interest.

Timeline

Course of Proceedings

The High Court of Judicature at Allahabad found that the invocation of the urgency clause under Section 17 of the Land Acquisition Act, 1894, was illegal. However, it did not quash the acquisition, considering the substantial development on the acquired lands. The High Court directed that landowners who had not accepted compensation under the Karar Niyamawali should be compensated as per the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, with the market value determined on the date of the judgment. Those who accepted compensation under the Karar Niyamawali were not granted any relief.

Legal Framework

The case primarily revolves around the Land Acquisition Act, 1894, and the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The 1894 Act provides the legal framework for land acquisition, including provisions for invoking the urgency clause under Section 17, which allows the government to dispense with the inquiry under Section 5A. The 2013 Act aims to ensure fair compensation and transparency in land acquisition. The Uttar Pradesh (Determination of Compensation and Declaration of Award by Agreement) Rules, 1997 (Karar Niyamawali), was used to determine compensation for those who agreed to it.

Arguments

Arguments of the Acquiring Body (NOIDA):

• The writ petitions were filed with significant delay and laches, as the declaration under Section 6 of the Land Acquisition Act, 1894, was issued in 2008, but the petitions were filed between 2011 and 2014.
• There was no explanation for the delay in filing the writ petitions.
• The High Court’s reliance on Radhey Shyam (Dead) thru LRs. and others v. State of U.P. and others was misplaced, as in that case, the landowners had established prejudice due to the failure to hold an inquiry under Section 5A of the 1894 Act.
• Most landowners had accepted the compensation, and only a few filed petitions belatedly.
• The direction to pay compensation as per the 2013 Act, using the market value on the date of the High Court’s judgment, was illegal.

Arguments of the Landowners (who did not accept compensation under Karar Niyamawali):

• The High Court’s order was equitable and balanced the rights of the landowners and the acquiring body.
• They supported the High Court’s decision to grant compensation based on the 2013 Act.

Arguments of the Landowners (who accepted compensation under Karar Niyamawali):

• The High Court should not have distinguished between landowners who accepted compensation and those who did not, especially after finding the invocation of the urgency clause illegal.
• They argued that the distinction was arbitrary.
• They also relied on Radhey Shyam (Dead) thru LRs. and others v. State of U.P. and others, contending that once the invocation of Section 17 of the Land Acquisition Act, 1894 is held illegal, the acquisition cannot be sustained.
• They relied on Garg Woollen Private Ltd. v. State of U.P. & Ors. where the view taken in Radhey Shyam was followed.
• They relied on Savitri Devi etc. v. State of U.P. & Ors., where the court directed an enhancement of the market value by 64.7% and allotment of 10% developed land to each landowner.

Issues Framed by the Supreme Court

The Supreme Court considered the following issues:

1. Whether the High Court committed an error by not setting aside the acquisition after finding the invocation of Section 17 of the Land Acquisition Act, 1894, illegal.
2. Whether the High Court ought to have granted relief of higher market value and allotment of developed land in accordance with the decision of this Court in the case of Savitri Devi.
3. Whether the relief of the grant of market value in terms of the 2013 Act could have been denied to the land owners who had accepted the compensation by agreement in terms of the Karar Niyamawali.

Treatment of the Issue by the Court

Authorities

Cases:

• Radhey Shyam (Dead) thru LRs. and others v. State of U.P. and others, Supreme Court of India: The court distinguished this case, noting that in Radhey Shyam, the landowners had established prejudice due to the lack of inquiry under Section 5A of the Land Acquisition Act, 1894.
• Garg Woollen Private Ltd. v. State of U.P. & Ors., Supreme Court of India: The court noted that the view taken in the case of Radhey Shyam was followed in this case.
• Savitri Devi etc. v. State of U.P. & Ors., Supreme Court of India: The court clarified that the decision in Savitri Devi was specific to its unique facts and did not set a precedent for future cases. The court noted that in Savitri Devi, no development had taken place on the acquired land.
• Sahara India Commercial Corporation Limited and Others v. State of Uttar Pradesh and Others, Supreme Court of India: The court referred to this case where the urgency clause was held invalid, and relief was moulded by directing payment of compensation under the 2013 Act.

Legal Provisions:

• Section 4, Land Acquisition Act, 1894: Notification of intention to acquire land.
• Section 5A, Land Acquisition Act, 1894: Provision for inquiry and hearing of objections.
• Section 6, Land Acquisition Act, 1894: Declaration of acquisition.
• Section 17, Land Acquisition Act, 1894: Urgency clause allowing the government to take possession of land without inquiry under Section 5A.
• Section 23, Land Acquisition Act, 1894: Determination of compensation.
• Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013: Act providing for fair compensation and transparency in land acquisition.
• Uttar Pradesh (Determination of Compensation and Declaration of Award by Agreement) Rules, 1997 (Karar Niyamawali): Rules for determining compensation by agreement.

Judgment

How each authority was viewed by the Court:

• Radhey Shyam (Dead) thru LRs. and others v. State of U.P. and others [CITATION]: The Supreme Court distinguished this case, stating that the facts were different, and the landowners in that case had established prejudice due to the lack of inquiry under Section 5A of the Land Acquisition Act, 1894.
• Savitri Devi etc. v. State of U.P. & Ors. [CITATION]: The Supreme Court held that the decision was limited to the peculiar facts of that case and would not form a precedent for future cases.
• Sahara India Commercial Corporation Limited and Others v. State of Uttar Pradesh and Others [CITATION]: The Supreme Court followed this case for moulding the relief and directing the payment of compensation in terms of the 2013 Act.

What weighed in the mind of the Court?

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

• The discretionary nature of writ jurisdiction under Article 226 of the Constitution of India.
• The substantial development work carried out on the acquired lands.
• The fact that many landowners had accepted compensation under the Karar Niyamawali.
• The delay and laches in filing the writ petitions by the landowners.
• The need to balance the private interests of the landowners with the public interest.

Logical Reasoning

Key Takeaways

• The Supreme Court upheld the High Court’s decision not to quash the land acquisition, even though the urgency clause was illegally invoked.
• The Court emphasized that writ jurisdiction under Article 226 is discretionary and equitable, and it is not necessary to correct every illegality, especially if it has unjust results.
• Landowners who voluntarily accepted compensation under the Karar Niyamawali were not entitled to additional relief.
• The Court affirmed that the decision in Savitri Devi was specific to its facts and does not set a precedent for other cases.
• The Court upheld the High Court’s direction to pay compensation under the 2013 Act to those who had not accepted compensation under the Karar Niyamawali, using the date of the judgment as the deemed date for determining market value.

Directions

The Supreme Court did not give any specific directions other than dismissing the appeals and disposing of the contempt petition.

Specific Amendments Analysis

There is no specific amendment discussed in the judgment.

Development of Law

The ratio decidendi of this case is that the High Court’s decision not to set aside the acquisition was correct, even if the urgency clause was illegally invoked, due to the discretionary nature of writ jurisdiction and the substantial development on the land. The judgment also clarified that decisions like Savitri Devi are specific to their facts and do not set a precedent. This case reinforces the principle that the courts must balance private interests with public interests and that landowners who voluntarily accept compensation may not be entitled to additional relief at a later stage.

Conclusion

In conclusion, the Supreme Court dismissed the appeals, upholding the Allahabad High Court’s decision. The Court affirmed that while the invocation of the urgency clause was illegal, the acquisition was not set aside due to the substantial development on the acquired land and the discretionary nature of writ jurisdiction. The Court also held that landowners who had accepted compensation under the Karar Niyamawali were not entitled to additional compensation under the 2013 Act, while those who had not accepted compensation were entitled to compensation under the 2013 Act with the date of the High Court judgment as the deemed date for determining market value.