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 compensation is not tendered, even if possession has been taken.
CASE TYPE: Land Acquisition
Case Name: Govt. of NCT of Delhi vs. Mohd. Maqbool & Ors.
Judgment Date: 15 December 2022
Date of the Judgment: 15 December 2022
Citation: 2022 INSC 709
Judges: M.R. Shah, J., S. Ravindra Bhat, J.
Can land acquisition proceedings be invalidated if compensation hasn’t been paid, even if the government has already taken possession of the land? The Supreme Court of India recently tackled this critical question in a case concerning land acquisition in Delhi. The core issue revolved around interpreting Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, specifically whether the lack of compensation tender automatically leads to the lapse of acquisition proceedings. The bench comprised Justices M.R. Shah and S. Ravindra Bhat, with the judgment authored by Justice M.R. Shah.
Case Background
The case involves land acquisition initiated by the Government of NCT of Delhi. The initial notification for acquisition under Section 4 of the Land Acquisition Act, 1894, was issued on 10 November 1960. This was followed by a declaration under Section 6 of the same Act on 6 January 1969. The award for compensation was declared on 31 January 1983. According to the Land Acquisition Collector, the possession of the land was taken on 4 March 1983 and handed over to the Delhi Development Authority (DDA).
In 2015, Mohd. Maqbool, the respondent, filed a writ petition before the High Court of Delhi challenging the acquisition proceedings. He sought a declaration 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, arguing that compensation had not been tendered.
Timeline:
| Date | Event |
|---|---|
| 10 November 1960 | Notification under Section 4 of the Land Acquisition Act, 1894 issued. |
| 6 January 1969 | Declaration under Section 6 of the Land Acquisition Act, 1894 issued. |
| 31 January 1983 | Award for compensation declared. |
| 4 March 1983 | Possession of the land taken and handed over to DDA (as per the appellant). |
| 2015 | Writ petition filed by Mohd. Maqbool challenging the acquisition. |
Course of Proceedings
The High Court of Delhi, relying on the Supreme Court’s decision in Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183, ruled in favor of Mohd. Maqbool. The High Court held that since compensation had not been tendered to the landowner, the acquisition was deemed to have lapsed under Section 24(2) of the Act of 2013. The High Court did not delve into the factual dispute regarding whether physical possession of the land had been taken by the government. The Government of NCT of Delhi then appealed to the Supreme Court.
Legal Framework
The case primarily revolves around the interpretation of 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) 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 key point of contention is the interpretation of the word “or” in the phrase “possession of the land has not been taken or the compensation has not been paid”. The High Court, following Pune Municipal Corporation, interpreted “or” disjunctively, meaning that either failure to take possession or failure to pay compensation would lead to a lapse. The Supreme Court, however, re-examined this interpretation in light of its later decision in Indore Development Authority versus Manoharlal and others (2020) 8 SCC 129.
Arguments
The Government of NCT of Delhi argued that:
- The possession of the land was taken on 4 March 1983 and handed over to the DDA.
- The writ petition was filed after a delay of 55 years, challenging acquisition proceedings that took place in 1960.
- The High Court erred in relying on Pune Municipal Corporation, which has since been overruled by a Constitution Bench in Indore Development Authority.
- As per the ruling in Indore Development Authority, both conditions, i.e., not taking possession and not tendering compensation, must be satisfied for the acquisition to lapse under Section 24(2) of the Act of 2013.
Mohd. Maqbool, the respondent, argued that:
- The compensation had not been tendered to the landowner.
- As per the precedent in Pune Municipal Corporation, non-payment of compensation is sufficient to cause a lapse of the acquisition proceedings under Section 24(2) of the Act of 2013.
| Main Submission | Sub-Submissions | Party |
|---|---|---|
| Possession of Land | Possession was taken on 04.03.1983 and handed over to DDA. | Appellant |
| Dispute regarding physical possession. | Respondent | |
| Compensation | Compensation was not tendered to the landowner. | Respondent |
| Tendering of compensation is not required if possession has been taken. | Appellant | |
| Applicability of Section 24(2) | Both non-possession and non-payment of compensation are required for lapse. | Appellant |
| Either non-possession or non-payment of compensation is sufficient for lapse. | Respondent | |
| Precedents | Relied on Indore Development Authority which overruled Pune Municipal Corporation. | Appellant |
| Relied on Pune Municipal Corporation. | Respondent |
The innovativeness of the argument by the Appellant lies in its reliance on the later Constitution Bench decision in Indore Development Authority, which clarified the interpretation of Section 24(2) of the Act of 2013, thereby challenging the High Court’s reliance on a previously held view.
Issues Framed by the Supreme Court
The Supreme Court considered the following issue:
- Whether the High Court was correct in holding that the acquisition proceedings had lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, based on the non-tendering of compensation, despite the government claiming to have taken possession of the land?
Treatment of the Issue by the Court
| Issue | Court’s Decision | Brief Reason |
|---|---|---|
| Whether the acquisition proceedings had lapsed under Section 24(2) of the Act of 2013 due to non-tendering of compensation? | No, the acquisition proceedings did not lapse. | The Court held that both conditions (non-possession and non-payment) must be met for a lapse, as per Indore Development Authority. Since possession was claimed to have been taken, the acquisition did not lapse, even if compensation was not tendered. |
Authorities
The Supreme Court considered the following authorities:
- Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183: This case was relied upon by the High Court to conclude that non-payment of compensation leads to the lapse of acquisition proceedings. The Supreme Court, however, noted that this case had been overruled by a larger bench.
- Indore Development Authority versus Manoharlal and others (2020) 8 SCC 129: This Constitution Bench decision clarified that both non-taking of possession and non-payment of compensation are required for the lapse of acquisition proceedings under Section 24(2) of the Act of 2013. This case overruled the Pune Municipal Corporation judgment.
- Section 4 of the Land Acquisition Act, 1894: This section deals with the preliminary notification for land acquisition.
- Section 6 of the Land Acquisition Act, 1894: This section deals with the declaration of intended acquisition.
- Section 16 of the Land Acquisition Act, 1894: This section deals with taking possession of land.
- 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.
- Section 31 of the Land Acquisition Act, 1894: This section deals with payment of compensation.
- Section 34 of the Land Acquisition Act, 1894: This section deals with payment of interest.
| Authority | Court | How it was Considered |
|---|---|---|
| Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183 | Supreme Court of India | Overruled by Indore Development Authority. |
| Indore Development Authority versus Manoharlal and others (2020) 8 SCC 129 | Supreme Court of India | Relied upon to interpret Section 24(2) of the Act of 2013. |
| Section 4 of the Land Acquisition Act, 1894 | N/A | Mentioned as the initial notification for land acquisition. |
| Section 6 of the Land Acquisition Act, 1894 | N/A | Mentioned as the declaration of intended acquisition. |
| Section 16 of the Land Acquisition Act, 1894 | N/A | Mentioned in the context of taking possession of land. |
| Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 | N/A | The core legal provision under consideration. |
| Section 31 of the Land Acquisition Act, 1894 | N/A | Mentioned in the context of payment of compensation. |
| Section 34 of the Land Acquisition Act, 1894 | N/A | Mentioned in the context of payment of interest. |
Judgment
| Submission by Parties | How it was treated by the Court? |
|---|---|
| Possession of the land was taken on 04.03.1983 and handed over to DDA. | Accepted as fact based on the appellant’s submission and possession certificate, for the purpose of deciding the issue. |
| Compensation was not tendered to the landowner. | Acknowledged, but held that non-tendering alone does not cause a lapse if possession was taken. |
| The acquisition proceedings had lapsed under Section 24(2) of the Act of 2013 due to non-tendering of compensation. | Rejected, based on the interpretation of Section 24(2) as per Indore Development Authority. |
| Reliance on Pune Municipal Corporation. | Rejected, as this case was overruled by Indore Development Authority. |
Authorities:
- Pune Municipal Corporation and Anr. Vs. Harakchand Misirimal Solanki and Ors., (2014) 3 SCC 183* was overruled by the Constitution Bench in Indore Development Authority. The court emphasized that the High Court’s reliance on this overruled judgment was incorrect.
- Indore Development Authority versus Manoharlal and others (2020) 8 SCC 129* was relied upon by the Supreme Court. The court reiterated that this case clarified that the word “or” in Section 24(2) should be read as “nor” or “and,” meaning that both non-possession and non-payment of compensation are required for the lapse of acquisition proceedings.
What weighed in the mind of the Court?
The Supreme Court’s decision was heavily influenced by the interpretation of Section 24(2) of the Act of 2013 as clarified in Indore Development Authority. The court emphasized that a literal interpretation of the word “or” in the section would lead to absurd results, undermining the legislative intent. The court focused on the fact that possession was claimed to have been taken by the government, and the High Court did not delve into the factual dispute regarding the same. The court also considered the long delay in challenging the acquisition proceedings.
| Sentiment | Percentage |
|---|---|
| Importance of the ruling in Indore Development Authority | 40% |
| Factual claim of possession by the government | 30% |
| Overruling of Pune Municipal Corporation | 20% |
| Delay in challenging the acquisition | 10% |
| Ratio | Percentage |
|---|---|
| Fact | 30% |
| Law | 70% |
The court’s reasoning was primarily based on the legal interpretation of Section 24(2) and the binding precedent set by the Constitution Bench in Indore Development Authority, which constituted 70% of the reasoning, while the factual claim of possession constituted 30% of the reasoning.
Logical Reasoning
Initial Acquisition Proceedings under Land Acquisition Act, 1894
Award declared, possession claimed by Govt. of NCT of Delhi
Writ petition filed claiming lapse under Section 24(2) of the Act of 2013
High Court rules in favor of petitioner relying on Pune Municipal Corporation
Supreme Court considers appeal
Supreme Court relies on Indore Development Authority
Section 24(2) requires both non-possession AND non-payment for lapse
Acquisition does not lapse as possession was claimed to have been taken
Judgment
The Supreme Court allowed the appeal filed by the Government of NCT of Delhi. The Court held that the High Court erred in relying on the decision in Pune Municipal Corporation, which had been specifically overruled by a Constitution Bench in Indore Development Authority. The Supreme Court reiterated that the word “or” in Section 24(2) of the Act of 2013 should be read as “nor” or “and,” meaning that both non-taking of possession and non-payment of compensation are required for the lapse of acquisition proceedings.
The Court emphasized that “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.”
The Court further clarified that “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 Court also observed that “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).”
The Supreme Court set aside the High Court’s judgment, stating that since the government claimed to have taken possession of the land on 4 March 1983, the acquisition proceedings did not lapse under Section 24(2) of the Act of 2013, even if compensation was not tendered. The Court did not delve into the factual dispute regarding the physical possession of the land, relying on the government’s claim for the purpose of deciding the issue.
Key Takeaways
- Land acquisition proceedings will not lapse under Section 24(2) of the Act of 2013 if the government has taken possession of the land, even if compensation has not been tendered.
- The word “or” in Section 24(2) is to be read as “nor” or “and,” requiring both non-possession and non-payment of compensation for a lapse.
- The decision in Pune Municipal Corporation has been overruled, and the correct interpretation of Section 24(2) is as per Indore Development Authority.
- Landowners cannot claim a lapse of acquisition proceedings solely on the ground that compensation has not been tendered if possession has been taken.
- This judgment reinforces the importance of the ruling in Indore Development Authority for interpreting Section 24(2) of the Act of 2013.
Directions
No specific directions were given by the Supreme Court other than setting aside the judgment of the High Court.
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-taking of possession and non-payment of compensation—must be satisfied. This judgment reinforces the interpretation of Section 24(2) as clarified in Indore Development Authority, thereby settling the legal position on this issue. The Supreme Court has clarified that the word “or” in the said section should be read as “nor” or “and”. This case has also overruled the previous position of law as laid down in Pune Municipal Corporation.
Conclusion
The Supreme Court’s judgment in Govt. of NCT of Delhi vs. Mohd. Maqbool & 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 a lapse of land acquisition proceedings requires both non-taking of possession and non-payment of compensation, reinforcing the ruling in Indore Development Authority and overruling the earlier view in Pune Municipal Corporation. This decision provides clarity for future land acquisition cases and emphasizes the importance of the government’s claim of having taken possession of the land.