Supreme Court Upholds Land Acquisition, Overrules Delhi HC on Lapse: Government of NCT of Delhi vs. Manjeet Singh Anand (2023)

Date of the Judgment: January 20, 2023
Citation: 2023 INSC 64
Judges: M.R. Shah, J. and C.T. Ravikumar, J.

Can a person who is not the original landowner challenge a land acquisition? This question was at the heart of a recent Supreme Court case. The Supreme Court of India overturned a decision by the High Court of Delhi, clarifying the circumstances under which land acquisition proceedings can be deemed to have lapsed. The two-judge bench of Justices M.R. Shah and C.T. Ravikumar delivered the judgment, with Justice M.R. Shah authoring the opinion.

Case Background

The case involves land acquired by the government in 1964. The initial notification for acquisition was issued on February 13, 1964, under the Land Acquisition Act, 1894. The award for the land was declared on May 12, 1967. According to the Land Acquisition Collector (LAC), the government took physical possession of the land on June 7, 1967, and the compensation was deposited with the Reference Court on November 13, 1967. Years later, after the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 came into force, the respondent, Manjeet Singh Anand, filed a writ petition in the High Court of Delhi. He claimed that the acquisition should be considered lapsed under Section 24(2) of the 2013 Act, based on some documents like a General Power of Attorney and receipts. The High Court allowed the petition, relying on a previous decision that was later overruled by the Supreme Court.

Timeline

Course of Proceedings

The High Court of Delhi, relying on its earlier decision in Smt. Harbans Kaur Vs. Govt. of NCT of Delhi and Ors., allowed the writ petition filed by Manjeet Singh Anand. The High Court in Smt. Harbans Kaur case, had relied on the Supreme Court’s decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors.. However, the Supreme Court in Indore Development Authority Vs. Manoharlal and Ors., specifically overruled the Pune Municipal Corporation case. The Government of NCT of Delhi and Another appealed to the Supreme Court against the High Court’s order.

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 initiated under the Land Acquisition Act, 1894. Section 24(2) of the 2013 Act states:

“(2) 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 considered Section 4 and Section 31 of the Land Acquisition Act, 1894. Section 4 deals with the publication of preliminary notification of acquisition of land. Section 31 of the Land Acquisition Act, 1894, deals with payment of compensation.

Arguments

Appellant’s Arguments (Government of NCT of Delhi):

• The primary argument of the Government of NCT of Delhi was that the High Court erred in applying Section 24(2) of the 2013 Act. The government contended that the acquisition proceedings should not have been deemed to have lapsed.
• The government argued that the High Court’s reliance on the decision in Smt. Harbans Kaur was incorrect because that decision was based on the overruled judgment in Pune Municipal Corporation.
• The government also argued that the respondent, Manjeet Singh Anand, lacked the locus standi (the right to bring an action) to challenge the acquisition. They stated that he was not the recorded owner of the land and was merely relying on documents like a General Power of Attorney and receipts.
• The government relied on the Constitution Bench decision in Indore Development Authority Vs. Manoharlal and Ors., which clarified the interpretation of Section 24(2) of the 2013 Act.
• The government stated that the possession of the land was taken in 1967 and compensation was deposited in court, so there was no lapse of acquisition.

Respondent’s Arguments (Manjeet Singh Anand):

• The respondent argued that the acquisition proceedings should be deemed to have lapsed under Section 24(2) of the 2013 Act because the physical possession of the land was not taken, or the compensation was not paid.
• The respondent relied on the High Court’s decision in Smt. Harbans Kaur, which had favored the interpretation that if either possession was not taken or compensation was not paid, the acquisition would lapse.
• The respondent argued that the government had not fulfilled the conditions under Section 24(2) of the 2013 Act, and therefore, the acquisition should be deemed to have lapsed.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in a separate section, but the core issues addressed were:

1. Whether the High Court was correct in holding that the land acquisition proceedings had lapsed under Section 24(2) of the 2013 Act.
2. Whether the respondent, Manjeet Singh Anand, had the locus standi to challenge the acquisition proceedings.
3. Whether the decision in Pune Municipal Corporation, which was relied upon by the High Court, was correctly applied, given that it was overruled by Indore Development Authority.

Treatment of the Issue by the Court

Authorities

The Supreme Court considered the following authorities:

Cases:

• Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183 – Supreme Court of India.
• Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129 – Supreme Court of India.
• Smt. Harbans Kaur Vs. Govt. of NCT of Delhi and Ors. [W.P.(C) 5358 of 2014, decided on 02.02.2015] – High Court of Delhi.
• Shiv Kumar and Anr. Vs. Union of India and Ors., (2019) 10 SCC 229 – Supreme Court of India.
• Delhi Development Authority Vs. Godfrey Philips (I) Ltd. & Ors., – Civil Appeal No. 3073 of 2022 – Supreme Court of India.
• Delhi Administration Thr. Secretary, Land and Building Department & Ors. Vs. Pawan Kumar & Ors., – Civil Appeal No. 3646 of 2022 – Supreme Court of India.

Legal Provisions:

• Section 4 of the Land Acquisition Act, 1894 – Preliminary notification of acquisition.
• Section 16 of the Land Acquisition Act, 1894 – Taking possession of land.
• Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 – Lapse of acquisition proceedings.
• Section 31 of the Land Acquisition Act, 1894 – Payment of compensation.
• Section 34 of the Land Acquisition Act, 1894 – Interest on compensation.

Judgment

How each authority was viewed by the Court?

• The decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183 was overruled. The Supreme Court stated that the High Court’s reliance on this case was incorrect as it was specifically overruled by the Constitution Bench in Indore Development Authority.
• The decision in Indore Development Authority Vs. Manoharlal and Ors., (2020) 8 SCC 129 was followed. The Constitution Bench clarified the interpretation of Section 24(2) of the 2013 Act, stating that the word “or” should be read as “nor” or “and”.
• The decision in Smt. Harbans Kaur Vs. Govt. of NCT of Delhi and Ors. [W.P.(C) 5358 of 2014, decided on 02.02.2015] was overruled. The High Court’s decision was based on the overruled Pune Municipal Corporation case, making it unsustainable.
• The decisions in Shiv Kumar and Anr. Vs. Union of India and Ors., (2019) 10 SCC 229, Delhi Development Authority Vs. Godfrey Philips (I) Ltd. & Ors., – Civil Appeal No. 3073 of 2022 and Delhi Administration Thr. Secretary, Land and Building Department & Ors. Vs. Pawan Kumar & Ors., – Civil Appeal No. 3646 of 2022 were followed. These cases were cited to support the view that subsequent purchasers lack the locus standi to challenge land acquisitions.

What weighed in the mind of the Court?

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

• The interpretation of Section 24(2) of the 2013 Act, as clarified by the Constitution Bench in Indore Development Authority. The court emphasized that the word “or” in the section should be read as “nor” or “and.”
• The fact that physical possession of the land was taken in 1967, and compensation was deposited in the Reference Court.
• The lack of locus standi of the respondent, who was a subsequent purchaser and not the original landowner.
• The overruling of the Pune Municipal Corporation decision, which was the basis of the High Court’s judgment.

Logical Reasoning:

The Supreme Court considered the alternative interpretation of Section 24(2) that was adopted by the High Court, where “or” would be read as “or”. However, the Supreme Court rejected this interpretation citing the Constitution Bench decision in Indore Development Authority. The Court held that the interpretation of Section 24(2) by the Constitution Bench was binding. The Court also rejected the argument that the respondent had locus standi to challenge the acquisition.

The Supreme Court’s decision was based on the following reasons:

• The interpretation of Section 24(2) of the 2013 Act, as clarified by the Constitution Bench in Indore Development Authority, which held that the word “or” should be read as “nor” or “and.”
• The fact that the physical possession of the land was taken in 1967, and the compensation was deposited in the Reference Court.
• The lack of locus standi of the respondent, who was not the recorded owner of the land.
• The overruling of the Pune Municipal Corporation decision, which was the basis of the High Court’s judgment.

The Supreme Court quoted the following from the judgment:

“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.”

“The expression “paid” in the main part of Section 24(2) of the 2013 Act does not include a deposit of compensation in court.”

“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).”

There were no dissenting opinions in this case. The two-judge bench was unanimous in its decision.

Key Takeaways

• The Supreme Court clarified that the word “or” in Section 24(2) of the 2013 Act should be read as “nor” or “and.” This means that for land acquisition proceedings to lapse, both possession must not have been taken and compensation must not have been paid.
• A subsequent purchaser of land does not have the locus standi to challenge the land acquisition proceedings.
• Deposit of compensation in court is not considered payment under Section 24(2) of the 2013 Act.
• Once possession of the land is taken, the land vests in the state, and there is no divesting under Section 24(2) of the 2013 Act.

Directions

The Supreme Court did not issue any specific directions other than quashing the High Court’s judgment and allowing the appeal.

Development of Law

The ratio decidendi of the case is that for land acquisition proceedings to lapse under Section 24(2) of the 2013 Act, both possession of the land must not have been taken and compensation must not have been paid. The Supreme Court also clarified that a subsequent purchaser does not have the locus standi to challenge the acquisition. This decision reaffirms the interpretation of Section 24(2) as laid down in Indore Development Authority and settles the law on the issue, overruling the High Court’s interpretation.

Conclusion

The Supreme Court allowed the appeal filed by the Government of NCT of Delhi, overturning the High Court’s decision. The Supreme Court clarified that the acquisition proceedings did not lapse under Section 24(2) of the 2013 Act because possession was taken and compensation was deposited. The Court also held that the respondent, a subsequent purchaser, lacked the locus standi to challenge the acquisition. This judgment reinforces the interpretation of Section 24(2) as clarified by the Constitution Bench in Indore Development Authority.