Supreme Court Upholds Land Acquisition: Om Prakash Case (20 January 2023)

Introduction

Date of the Judgment: 20 January 2023
Citation: 2023 INSC 44
Judges: M.R. Shah, J., Hima Kohli, J.

Can land acquisition proceedings be deemed to have lapsed if the government takes possession of the land but doesn’t fully pay the compensation? The Supreme Court of India recently addressed this question, clarifying the conditions under which land acquisition can lapse under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. This case revolves around a dispute over land acquired decades ago, where the landowners claimed the acquisition had lapsed due to non-payment of full compensation. The bench comprised Justices M.R. Shah and Hima Kohli, with the judgment authored by Justice M.R. Shah.

Case Background

The case involves land that was initially notified for acquisition under Section 4 of the Land Acquisition Act, 1894, on 23 January 1965. The award for the acquisition was declared on 9 January 1981. According to the Government of NCT of Delhi, possession of the land was taken and handed over to the beneficiary department on 23 September 1981. However, the payment of compensation could not be fully ascertained due to the poor condition of the Naksha Muntzamin (a land record document). After approximately 24 years, the original landowners filed a writ petition in 2014, claiming 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 full compensation was not tendered.

Timeline

Course of Proceedings

The High Court of Delhi allowed the writ petition filed by the original landowners, declaring that the acquisition had lapsed under Section 24(2) of the Act, 2013. The High Court reasoned that it could not be clearly ascertained whether compensation had been tendered to the landowners, despite the fact that possession was taken. The Government of NCT of Delhi and the Delhi Development Authority then appealed to the Supreme Court, challenging the High Court’s decision.

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 deals with the lapse of land acquisition proceedings if certain conditions are not met. Section 24(2) 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:
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, referring to its Constitution Bench decision in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, 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 conditions – not taking possession and not paying compensation – must be met. If either possession has been taken or compensation has been paid, the acquisition does not lapse. The Supreme Court also clarified that the expression “paid” does not include a deposit of compensation in court.

Arguments

Appellants’ Arguments:

• The Government of NCT of Delhi argued that possession of the land had been taken on 23 September 1981 and handed over to the beneficiary department.
• They contended that the payment of compensation could not be ascertained due to the damaged condition of the Naksha Muntzamin, but this did not mean compensation was not tendered.
• The appellants relied on the Supreme Court’s decision in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, which clarified that both non-possession and non-payment of compensation are required for a lapse under Section 24(2) of the Act, 2013.

Respondents’ Arguments:

• The original landowners argued that full compensation had not been tendered in accordance with the Land Acquisition Act, 1894.
• They claimed that since full compensation was not paid, the acquisition proceedings should be deemed to have lapsed under Section 24(2) of the Act, 2013.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in a separate section. However, the core issue that the court addressed was:

• Whether the acquisition proceedings lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, when possession of the land was taken, but the full compensation was not ascertained to have been tendered.

Treatment of the Issue by the Court

Authorities

The Supreme Court relied on the following authorities:

• Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129 – Supreme Court of India. This Constitution Bench decision clarified the interpretation of Section 24(2) of the 2013 Act, stating that the word “or” should be read as “nor” or “and,” requiring both non-possession and non-payment for a lapse. The court followed this precedent.

Judgment

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

How each authority was viewed by the Court?

The Supreme Court relied heavily on the decision in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129. The court stated that “as per the decision of this Court in the case of Indore Development Authority (supra) for attracting Section 24(2) of the Act, 2013, twin conditions of not taking possession and not tendering compensation have to be satisfied. It is observed and held that if one of the conditions is not satisfied, there shall not be any lapse under Section 24(2) of the Act, 2013.” This precedent was used to reject the respondents’ claim that the acquisition had lapsed.

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 Act, 2013, as clarified in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129. The court emphasized that both non-possession and non-payment of compensation are necessary for the acquisition to lapse. The fact that possession was taken on 23 September 1981 was a critical factor. The court also noted that the landowners had raised the issue of non-payment of full compensation for the first time in 2014, after a delay of 24 years from the date of the award.

Fact:Law Ratio

Logical Reasoning:

Key Takeaways

• The Supreme Court reaffirmed 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.
• The word “or” in Section 24(2) is to be read as “nor” or “and,” as clarified in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129.
• If possession of the land has been taken, the acquisition does not lapse even if full compensation has not been paid.
• Landowners cannot claim a lapse of acquisition if they raise the issue of non-payment of full compensation after a significant delay.

Directions

The Supreme Court did not give any specific directions other than quashing the High Court’s judgment and upholding the land acquisition.

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 conditions—non-possession and non-payment of compensation—must be met. This judgment reinforces the interpretation of Section 24(2) as clarified in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, and does not introduce any new legal principles but reaffirms the existing position of law.

Conclusion

The Supreme Court’s judgment in the case of The Secretary, Land & Building Department Govt. of NCT of Delhi & Ors. vs. Om Prakash (Dead) Through LRs. AND ORS. 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 the acquisition proceedings do not lapse if possession of the land has been taken, even if full compensation has not been paid. This decision reinforces the precedent set in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, and provides clarity on the conditions required for a lapse of land acquisition proceedings.

Category

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

FAQ

Q: What does this judgment mean for landowners whose land has been acquired?
A: This judgment clarifies that if the government has taken possession of your land, the acquisition will not lapse even if you haven’t received full compensation. You may still be entitled to the remaining compensation, but the acquisition itself remains valid.

Q: What is Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013?
A: Section 24(2) deals with the lapse of land acquisition proceedings if certain conditions are not met. It states that if an award was made five years or more before the Act came into force, and possession has not been taken or compensation has not been paid, the acquisition is deemed to have lapsed. However, the Supreme Court has clarified that the word “or” should be read as “and or nor”.

Q: What is the significance of the Indore Development Authority case in this judgment?
A: The Supreme Court relied heavily on the precedent set in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129, which clarified that both non-possession and non-payment of compensation are required for a lapse under Section 24(2). This interpretation was crucial in the present case.