Supreme Court Upholds Land Acquisition: NCT of Delhi vs. Jai Pal (2023)

LEGAL ISSUE: Whether land acquisition proceedings lapse 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: Government of NCT of Delhi and Ors. vs. Jai Pal. Judgment Date: 13 March 2023

Introduction

Date of the Judgment: 13 March 2023
Citation: 2023 INSC 218
Judges: M.R. Shah, J. and Manoj Misra, J.
Can land acquisition proceedings be nullified if the government takes possession of the land but hasn’t paid compensation? The Supreme Court of India recently addressed this critical 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 clarifies the circumstances under which land acquisition proceedings are deemed to have lapsed. The bench comprised Justices M.R. Shah and Manoj Misra, with the judgment authored by Justice M.R. Shah.

Case Background

The Government of NCT of Delhi initiated land acquisition proceedings under the Land Acquisition Act, 1894. The High Court of Delhi had ruled that the acquisition had lapsed under Section 24(2) of the 2013 Act, because compensation was not paid, relying on a previous Supreme Court decision. The Government of NCT of Delhi appealed this decision, contending that possession of the land had been taken on 11 July 2008, and therefore, the acquisition should not lapse.

Timeline

Course of Proceedings

The High Court of Delhi, in its judgment, had declared that the land acquisition proceedings had lapsed based on the fact that compensation had not been paid, relying on the Supreme Court’s decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183. The Government of NCT of Delhi appealed this decision to the Supreme Court, arguing that possession had been taken, and therefore, the acquisition should not lapse.

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. This section addresses the lapse of land acquisition proceedings initiated under the Land Acquisition Act, 1894, if certain conditions are met. Section 24(2) of the 2013 Act 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.”

Arguments

The arguments presented before the Supreme Court were primarily focused on the interpretation of Section 24(2) of the 2013 Act. The Government of NCT of Delhi argued that since they had taken possession of the land on 11.07.2008, the acquisition proceedings should not lapse, even if compensation had not been paid. The respondent, on the other hand, relied on the High Court’s decision, which had held that non-payment of compensation was sufficient to cause a lapse under Section 24(2), based on the interpretation of the word “or” in the section.

Issues Framed by the Supreme Court

The primary issue before the Supreme Court was:

1. Whether the land acquisition proceedings initiated under the Land Acquisition Act, 1894, are deemed to have lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, if possession of the land was taken but compensation was not paid?

Treatment of the Issue by the Court

Authorities

The Supreme Court considered the following authorities:

• Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183 – High Court relied on this case which was overruled by a later judgment.
• Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129 – Constitution Bench of the Supreme Court overruled the Pune Municipal Corporation case and clarified the interpretation of Section 24(2) of the 2013 Act.

The Supreme Court also considered the following legal provisions:

• Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.
• Land Acquisition Act, 1894

Judgment

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 in the Indore Development Authority case. The court emphasized that the intention of the legislature was to prevent the lapse of acquisition proceedings if either possession was taken or compensation was paid. The court also gave importance to the fact that the previous decision in Pune Municipal Corporation had been overruled, and therefore, the High Court’s reliance on it was misplaced.

The Supreme Court emphasized the following points in its reasoning:

• The High Court’s reliance on the Pune Municipal Corporation case was incorrect as it had been overruled.
• The correct interpretation of Section 24(2) of the 2013 Act, as clarified in Indore Development Authority, is that the word “or” should be read as “nor” or “and.”
• If either possession is taken or compensation is paid, the acquisition proceedings do not lapse.
• “The deemed lapse of land acquisition proceedings under Section 24(2) of the 2013 Act takes place where due to inaction of authorities for five years or more prior to commencement of the said Act, the possession of land has not been taken nor compensation has been paid.”
• “In other words, in case possession has been taken, compensation has not been paid then there is no lapse. Similarly, if compensation has been paid, possession has not been taken then there is no lapse.”
• “Once award has been passed on taking possession under Section 16 of the 1894 Act, the land vests in State there is no divesting provided under Section 24(2) of the 2013 Act, as once possession has been taken there is no lapse under Section 24(2).”

Key Takeaways

• Land acquisition proceedings under the Land Acquisition Act, 1894, do not lapse under Section 24(2) of the 2013 Act if possession of the land has been taken, irrespective of whether compensation has been paid.
• The word “or” in Section 24(2) of the 2013 Act should be interpreted as “nor” or “and.”
• The decision in Pune Municipal Corporation is no longer valid and has been overruled by the Indore Development Authority case.
• This judgment clarifies the circumstances under which land acquisition proceedings are deemed to have lapsed, providing certainty to both the government and landowners.

Directions

The Supreme Court quashed and set aside the High Court’s judgment and dismissed the original writ petition. There was no deemed lapse of acquisition with respect to the land in question.

Development of Law

The ratio decidendi of this case is that the word “or” in Section 24(2) of the 2013 Act should be read as “nor” or “and”. This clarifies that land acquisition proceedings do not lapse if either possession has been taken or compensation has been paid. This judgment reaffirms the position of law as laid down in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, and overrules the previous position of law in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183.

Conclusion

The Supreme Court’s judgment in Government of NCT of Delhi vs. Jai Pal 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 land acquisition proceedings do not lapse if possession of the land has been taken, regardless of whether compensation has been paid. The Court’s decision provides clarity and consistency in the application of land acquisition laws.