Supreme Court Upholds Land Acquisition: Land and Building Department vs. Mahipal Singh (2022)

Introduction

Date of the Judgment: 02 December 2022

Citation: 2022 INSC 1735

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

Can land acquisition proceedings be deemed to have lapsed if the compensation wasn’t paid before a new law came into effect, even if the government had already taken possession of the land? This was the core question before the Supreme Court in a recent case involving the Government of NCT of Delhi and certain landowners. The Supreme Court addressed the issue of whether the land acquisition proceedings initiated under the Land Acquisition Act, 1894, had lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The Court, in this judgment, clarified the interpretation of Section 24(2) of the 2013 Act.

The judgment was delivered by a two-judge bench comprising Justice M.R. Shah and Justice C.T. Ravikumar. Justice M.R. Shah authored the judgment.

Case Background

The case revolves around land acquisition proceedings initiated under the Land Acquisition Act, 1894, by the Government of NCT of Delhi. The government claimed that it had taken possession of the land on December 3, 2012, and handed it over to the Delhi Development Authority (DDA). The compensation was sent to the Reference Court on October 28, 2014, due to an apportionment dispute. The landowners, however, argued that since the compensation was not tendered before the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, came into force, the acquisition proceedings should be considered lapsed under Section 24(2) of the 2013 Act.

Timeline

Course of Proceedings

The High Court of Delhi at New Delhi, in Writ Petition (C) No. 11238 of 2015, ruled in favor of the landowners. The High Court declared that the land acquisition proceedings had lapsed under Section 24(2) of the Act, 2013, relying on the Supreme Court’s decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183. The High Court held that since the compensation was not tendered before the 2013 Act came into force, the acquisition was deemed to have lapsed. The Government of NCT of Delhi then appealed this decision to the Supreme Court.

Legal Framework

The core legal issue revolves around Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. Section 24(2) of the Act, 2013 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 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.”

The Supreme Court also referred to Section 31(1) of the Land Acquisition Act, 1894, which deals with the payment of compensation.

Arguments

The appellants (Government of NCT of Delhi) argued that the High Court’s decision was incorrect because the possession of the land had been taken on December 3, 2012, and handed over to the DDA. They also pointed out that the compensation was sent to the Reference Court on October 28, 2014, due to an apportionment dispute. The appellants contended that the land acquisition proceedings should not be deemed to have lapsed under Section 24(2) of the Act, 2013, as possession had already been taken.

The respondents (landowners) argued that the land acquisition proceedings had lapsed under Section 24(2) of the Act, 2013, because the compensation was not tendered before the Act came into force. They relied on the decision of the Supreme Court in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, which supported their argument.

Issues Framed by the Supreme Court

The core issue before the Supreme Court was whether the land acquisition proceedings initiated under the Land Acquisition Act, 1894, had lapsed under Section 24(2) of the Act, 2013, given that possession was taken before the 2013 Act came into force, but compensation was not tendered before that date.

Treatment of the Issue by the Court

Authorities

The Supreme Court relied on the following authorities:

Judgment

The Supreme Court overturned the High Court’s decision. The Court held that the judgment in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, which the High Court relied upon, had been specifically overruled by a Constitution Bench in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129. The Court emphasized that the Constitution Bench had clarified that if possession of the land has been taken, the land acquisition proceedings do not lapse under Section 24(2) of the Act, 2013, even if compensation has not been paid.

The Court observed:

“The view taken by the High Court relying upon the decision of this Court in the case of Pune Municipal Corporation and Anr. (supra) is unsustainable in view of the Constitution Bench decision of this Court in the case of Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129.”

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the Constitution Bench’s ruling in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, which clarified the interpretation of Section 24(2) of the 2013 Act. The Court emphasized that the key factor for determining whether the land acquisition proceedings lapsed was whether possession had been taken, not whether compensation had been paid before the 2013 Act came into force. The Court’s reasoning was based on the principle that once possession has been taken, the land vests in the State, and there is no divesting under Section 24(2) of the 2013 Act.

Fact:Law Ratio

Logical Reasoning

Key Takeaways

✓ Land acquisition proceedings do not automatically lapse under Section 24(2) of the 2013 Act if possession of the land has been taken, even if compensation was not tendered before the Act came into force.

✓ The Supreme Court’s decision in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129 is the binding precedent on the interpretation of Section 24(2) of the Act, 2013.

✓ The judgment in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183 has been overruled and cannot be relied upon.

Directions

The Supreme Court quashed and set aside the impugned judgment and order passed by the High Court of Delhi. The appeal was allowed, and no costs were imposed.

Development of Law

The ratio decidendi of this case is that once possession of the land has been taken by the government, the land acquisition proceedings do not lapse under Section 24(2) of the 2013 Act, even if compensation was not tendered before the Act came into force. This judgment clarifies the position of law and overrules the previous position as stated in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183.

Conclusion

The Supreme Court’s judgment in Land and Building Department vs. Mahipal Singh clarifies the interpretation of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The Court held that if possession of the land has been taken, the land acquisition proceedings do not lapse, even if compensation was not tendered before the Act came into force. This decision overrules the previous position and provides a clear guideline for future cases involving land acquisition.