Supreme Court Upholds Land Acquisition: Haryana vs. Sunder Lal (2019)

Date of the Judgment: July 22, 2019

Citation: Civil Appeal No. 5754 of 2019 (Arising out of SLP (Civil) No. 28807 of 2018)

Judges: The judgment was delivered by a bench of Justices Arun Mishra and M.R. Shah.

Can a mere paper entry of possession be considered valid when the landowner claims to still be in physical possession? The Supreme Court of India recently tackled this question in a land acquisition dispute between the State of Haryana and a landowner, Sunder Lal. The core issue was whether the State had effectively taken possession of land acquired for development purposes, or if the acquisition had lapsed. The bench comprised Justices Arun Mishra and M.R. Shah, who delivered a unanimous verdict.

Case Background

The State of Haryana initiated land acquisition proceedings on August 24, 2000, under Section 4 of the Land Acquisition Act, 1894, to acquire 189.93 acres of land in Gurgaon for residential, commercial, and institutional development. This land included a plot owned by Sunder Lal, the respondent, measuring two Kanal. An award was passed on July 21, 2003, and the State claimed to have taken possession of the land, handing it over to the Haryana Urban Development Authority (HUDA). Sunder Lal received compensation for his land via cheque on July 31, 2003.

In 2015, Sunder Lal filed a writ petition in the High Court of Punjab & Haryana, arguing that the acquisition had lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, because physical possession had not been taken. He claimed to have constructed residential houses and shops on the land.

Timeline:

Course of Proceedings

The High Court ruled in favor of Sunder Lal, stating that while the State claimed possession, there was no proof of physical dispossession. The High Court noted that the Act of 2013 came into force on January 1, 2014, and directed the Land Acquisition Collector, Gurgaon, to determine the amount to be refunded by Sunder Lal. The High Court also noted that development had not been undertaken on the land, and the owners were entitled to compensation under the 2013 Act. Aggrieved by this decision, the State of Haryana appealed to the Supreme Court.

Legal Framework

The case primarily revolves around the interpretation of “taking possession” under the Land Acquisition Act, 1894, and Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. Section 24(2) of the 2013 Act states that if physical possession of the land has not been taken or compensation has not been paid, the acquisition proceedings are deemed to have lapsed.

The Land Acquisition Act, 1894, allows the government to acquire land for public purposes. The key issue here is the mode of taking possession, which the Supreme Court has addressed in various judgments. The 2013 Act introduces the concept of lapsing of acquisition if physical possession is not taken or compensation is not paid.

Arguments

Arguments of the Appellants (State of Haryana):

• The State argued that possession had been taken on July 21, 2003, as evidenced by the Rapat (possession report).
• They contended that the mode of taking possession, as per established legal precedent, is by drawing a panchnama (possession memo) on the spot.
• The State asserted that compensation had been paid to Sunder Lal in 2003, and the acquisition had attained finality.
• Any encroachment or construction made by the respondent after the acquisition was illegal and should not benefit him.

Arguments of the Respondent (Sunder Lal):

• Sunder Lal argued that physical possession of the land, particularly the two rooms existing on the land, had not been taken.
• He claimed that a mere paper entry of possession does not amount to taking physical possession.
• He submitted that under Section 24(2) of the Act of 2013, the acquisition had lapsed as the physical possession remained with him.
• He referred to the ‘Policy for Return of Un-utilized Land’ framed under the Haryana Amendment Act, 2017, and the release orders passed for similarly situated landowners.
• He presented photographs and a site plan to support his claim that structures existed on the land.

Innovativeness of the argument: The respondent’s argument that the acquisition had lapsed due to the lack of physical possession despite the State’s claim of paper possession, was innovative in the context of Section 24(2) of the 2013 Act.

Submissions Table

Issues Framed by the Supreme Court

The Supreme Court framed the following issue:

1. Whether possession of land has been taken after passing of the award on 21.7.2003 in land acquisition proceedings initiated vide Notification dated 24.8.2000 issued under Section 4 of the Land Acquisition Act, 1894.

Treatment of the Issue by the Court

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

Authorities

The Supreme Court considered the following authorities:

On the Mode of Taking Possession:

• Balwant Narayan Bhagde v. M.D. Bhagwat, (1976) 1 SCC 700 – The Court held that inspecting the land by the Tahsildar was sufficient to constitute taking possession.
• Tamil Nadu Housing Board v. A. Viswam (Dead) by LRs., (1996) 8 SCC 259 – The Court held that recording a memorandum by the Land Acquisition Officer in the presence of witnesses is sufficient for taking possession.
• Banda Development Authority, Banda v. Moti Lal Agarwal, (2011) 5 SCC 394 – The Court held that if acquisition is of a large tract of land, symbolic possession by preparing an appropriate document in the presence of independent witnesses is sufficient.
• State of T.N. v. Mahalakshmi Ammal, (1996) 7 SCC 269 – The Court held that possession would be taken by drawing a memorandum or panchnama.
• Balmokand Khatri Educational and Industrial Trust, Amritsar v. State of Punjab, (1996) 4 SCC 212 – The Court held that the normal mode of taking possession is drafting the panchnama in the presence of panchas.
• P.K. Kalburqi v. State of Karnataka, (2005) 12 SCC 489 – The Court held that if the land was vacant and unoccupied, taking symbolical possession is enough.
• Sita Ram Bhandar Society, New Delhi v. Lieutenant Governor, Government of NCT, Delhi, (2009) 10 SCC 501 – The Court observed that the mode of taking possession is by way of drawing a panchnama.
• Omprakash Verma v. State of Andhra Pradesh, (2010) 13 SCC 158 – The Court reiterated that the mode of taking possession is by drawing of panchnama.
• M. Venkatesh v. Commissioner, Bangalore Development Authority, (2015) 17 SCC 1 – The Court reiterated that the mode of taking possession is by drawing a panchnama.

On the Requirement of Physical Possession:

• State of Madhya Pradesh v. Narmada Bachao Andolan, (2011) 7 SCC 639 – The Court held that whether possession has been taken or not depends on the facts of the individual case.

Authorities Table

Judgment

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

How each authority was viewed by the Court?

• The Court relied on Balwant Narayan Bhagde v. M.D. Bhagwat [CITATION], to support the view that the Tahsildar’s inspection of the land was sufficient for taking possession.
• The Court cited Tamil Nadu Housing Board v. A. Viswam (Dead) by LRs. [CITATION], to validate that recording a memorandum by the LAO in the presence of witnesses is a valid mode of taking possession.
• The Court followed Banda Development Authority, Banda v. Moti Lal Agarwal [CITATION], to support that symbolic possession is sufficient for large tracts of land.
• The Court referred to State of T.N. v. Mahalakshmi Ammal [CITATION], to reiterate that possession can be taken by drawing a memorandum or panchnama.
• The Court used Balmokand Khatri Educational and Industrial Trust, Amritsar v. State of Punjab [CITATION], to reiterate that drafting the panchnama in the presence of panchas is the normal mode of taking possession.
• The Court cited P.K. Kalburqi v. State of Karnataka [CITATION], to support that symbolic possession is enough for vacant land.
• The Court relied on Sita Ram Bhandar Society, New Delhi v. Lieutenant Governor, Government of NCT, Delhi [CITATION], to support that mode of taking possession is by way of drawing of panchnama.
• The Court followed Omprakash Verma v. State of Andhra Pradesh [CITATION], to support that the mode of taking possession is by drawing of panchnama.
• The Court cited M. Venkatesh v. Commissioner, Bangalore Development Authority [CITATION], to support the view that the mode of taking possession is by drawing a panchnama.
• The Court referred to State of Madhya Pradesh v. Narmada Bachao Andolan [CITATION], to support that whether possession has been taken or not depends on the facts of the individual case.

The Supreme Court concluded that the State had taken possession of the land in 2003 by drawing a panchnama, marking the land, posting a watchman, and making an announcement by beating drums. The Court held that the existence of two outhouses did not negate the fact that possession was taken. The Court also noted that most of the structures on the land were erected after the possession was taken by the State. The Court held that the respondent was an encroacher and not entitled to any indulgence.

The Court stated, “It is a settled proposition of law that when the State acquires the large tract of land and draws the panchnama of taking possession, the same is enough for taking possession of the land.”

The Court further observed, “Once possession had been taken and compensation has been admittedly collected by the respondent, it was not open for him to apply for de-notification of land under Section 48 of the Land Acquisition Act, 1894 or for its release.”

The Court also noted, “It cannot be said that land acquired is unutilised land, as a matter of fact, lot of development has taken place as there is encroachment made, as such, land could not have been utilised and by making unwarranted interference by the High Court, the acquisition was ordered to be quashed.”

What weighed in the mind of the Court?

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

• Legal Precedent on Taking Possession: The Court emphasized that the established legal precedent supports the view that drawing a panchnama and taking symbolic possession is sufficient for large tracts of land. The court relied on various judgments to support this view.
• Evidence of Possession: The Court found that the Rapat dated 21.7.2003, along with the drawing of panchnama, marking of the land, and posting of a watchman, clearly demonstrated that possession was taken by the State.
• Finality of Acquisition: The Court noted that the acquisition process had attained finality, with the award passed and compensation collected by the respondent. The Court held that subsequent actions by the respondent, such as encroachment, could not invalidate the acquisition.
• Illegal Encroachment: The Court viewed the respondent’s construction on the land after possession was taken as an illegal encroachment, which did not entitle him to any relief.

Sentiment Analysis of Reasons

Fact:Law Ratio

Logical Reasoning Flowchart:

Key Takeaways

• Mode of Taking Possession: The Supreme Court reaffirmed that drawing a panchnama and taking symbolic possession is a valid mode of taking possession of land, especially for large tracts of land.
• Finality of Acquisition: Once the acquisition process is complete, and compensation is paid, the acquisition attains finality. Subsequent actions by the landowner cannot invalidate the acquisition.
• Illegal Encroachment: Any encroachment or construction on acquired land after possession has been taken is illegal and will not be protected by the courts.
• Section 24(2) of the 2013 Act: The Court clarified that the provisions of Section 24(2) of the 2013 Act would not apply if possession had been taken under the 1894 Act, even if physical dispossession did not occur.

Directions

The Supreme Court set aside the impugned judgment and order of the High Court. The appeal filed by the State of Haryana was allowed.

Development of Law

The ratio decidendi of this case is that the drawing of a panchnama and taking symbolic possession is a valid mode of taking possession of land under the Land Acquisition Act, 1894, especially for large tracts of land. This judgment reinforces the established legal position on the mode of taking possession and clarifies that physical dispossession is not always necessary for the acquisition to be valid. The judgment also clarifies that Section 24(2) of the 2013 Act will not apply if possession has been taken under the 1894 Act.

Conclusion

The Supreme Court’s judgment in State of Haryana & Ors. vs. Sunder Lal upholds the State’s acquisition of land, emphasizing that the drawing of a panchnama and taking symbolic possession are sufficient for taking possession under the Land Acquisition Act, 1894. The Court rejected the respondent’s claim that the acquisition had lapsed due to lack of physical possession. This decision reinforces the finality of land acquisition proceedings and clarifies the legal position on the mode of taking possession. The Court also held that the respondent was an encroacher and not entitled to any relief.