Supreme Court Upholds Land Acquisition, Rejects Lapse Claim: Delhi Development Authority vs. Narvada Devi (2023)

Introduction

Date of the Judgment: 09 February 2023

Citation: Civil Appeal No. 735 of 2023 (@SLP (C) No. 2486 of 2023) (@ DIARY NO. 23396 of 2022)

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

Can land acquisition proceedings be deemed to have lapsed if the government has taken possession of the land, but has not paid compensation, or vice versa? The Supreme Court of India recently addressed this critical question in a case involving the Delhi Development Authority (DDA) and a landowner, Narvada Devi. The core issue revolved around the interpretation of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (the “Act, 2013”), which deals with the lapsing of land acquisition proceedings. This judgment clarifies the circumstances under which land acquisition can be deemed to have lapsed, providing much-needed guidance on this complex area of law. The judgment was delivered by a two-judge bench comprising Justice M.R. Shah and Justice C.T. Ravikumar, with the majority opinion authored by Justice M.R. Shah.

Case Background

The case involves a dispute over land measuring 504 square yards in Village Pehladpur Bangar, Delhi. The Delhi Development Authority (DDA) had initiated acquisition proceedings for this land. Narvada Devi, the original writ petitioner, claimed that the acquisition had lapsed under Section 24(2) of the Act, 2013, because neither physical possession had been taken nor compensation had been tendered.

The DDA contended that it had released compensation of Rs. 80,40,76,004 to the Land & Building Department, GNCTD, on 09.08.2005. They also claimed that while they had taken possession of 457 Bigha 08 Biswa of land in Village Pehladpur Bangar, the remaining area was under illegal occupation. The DDA further stated that the original writ petitioner had encroached on government land and was claiming ownership.

Despite the DDA’s claims, the High Court of Delhi ruled in favor of Narvada Devi, declaring that the acquisition had lapsed. The High Court acknowledged that the DDA could not take actual vacant possession due to encroachments, but still held that the acquisition had lapsed and that the original writ petitioner would only be entitled to compensation as per the Act, 2013.

Timeline

Course of Proceedings

The High Court of Delhi allowed the writ petition filed by Narvada Devi, holding that the land acquisition proceedings had lapsed under Section 24(2) of the Act, 2013. The High Court reasoned that since actual physical possession of the entire land had not been taken and compensation had not been paid to the petitioner, the acquisition was deemed to have lapsed. The DDA appealed this decision to the Supreme Court of India.

Legal Framework

The core of this case lies in 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 lapsing of land acquisition proceedings initiated under the Land Acquisition Act, 1894.

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: 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 also considered Section 31(1) of the Land Acquisition Act, 1894, which deals with the payment of compensation:
“On making an award under section 11, the Collector shall tender payment of the compensation awarded by him to the persons interested entitled thereto according to the award, and shall pay it to them unless prevented by some one or more of the contingencies mentioned in the next sub-section.”

The Supreme Court also referred to Section 16 of the Land Acquisition Act, 1894, which deals with taking possession of land:
“When the Collector has made an award under section 11, he may take possession of the land, which shall thereupon vest absolutely in the Government, free from all encumbrances.”

Arguments

Arguments of the Appellant (Delhi Development Authority):

• The DDA argued that it had released the compensation amount to the Land & Building Department on 09.08.2005.
• The DDA contended that it had taken possession of a significant portion of the land (457 Bigha 08 Biswa), as per possession proceedings dated 31.08.2005.
• The DDA submitted that the remaining land was under illegal occupation, and they were taking steps to remove the encroachers.
• The DDA argued that the original writ petitioner was an encroacher on government land and was falsely claiming ownership.
• The DDA relied on the Constitution Bench decision in Indore Development Authority Vs. Manoharlal and Ors. (2020) 8 SCC 129, stating that the word “or” in Section 24(2) should be read as “nor” or “and”.

Arguments of the Respondent (Narvada Devi):

• The respondent argued that the acquisition proceedings should be deemed to have lapsed under Section 24(2) of the Act, 2013.
• The respondent contended that neither physical possession of the subject land was taken nor compensation was tendered to them.
• The respondent relied on the literal interpretation of Section 24(2) of the Act, 2013, which states that if either possession is not taken or compensation is not paid, the acquisition lapses.

Issues Framed by the Supreme Court

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

• Whether the acquisition proceedings are deemed to have lapsed under Section 24(2) of the Act, 2013, when physical possession of the land is not taken or compensation is not paid.

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues:

Authorities

The Supreme Court primarily relied on the following authority:

The legal provisions considered by the court are:

• Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013: This section deals with the lapsing of land acquisition proceedings.
• Section 31(1) of the Land Acquisition Act, 1894: This section deals with the payment of compensation.
• Section 16 of the Land Acquisition Act, 1894: This section deals with taking possession of land.

Judgment

How each authority was viewed by the Court?

• Indore Development Authority Vs. Manoharlal and Ors. (2020) 8 SCC 129: The Supreme Court followed this authority and applied the principle that the word “or” in Section 24(2) of the Act, 2013 should be read as “nor” or “and”.

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 by the Constitution Bench in Indore Development Authority Vs. Manoharlal and Ors. (2020) 8 SCC 129. The Court emphasized that the word “or” in Section 24(2) should be read as “nor” or “and”. This interpretation meant that the acquisition would lapse only if both possession was not taken and compensation was not paid. The Court also considered the fact that the DDA had taken possession of a significant portion of the land and had released compensation, even though the remaining land was under illegal occupation.

Logical Reasoning:

The Supreme Court rejected the High Court’s interpretation of Section 24(2) of the Act, 2013, which had held that the acquisition proceedings had lapsed. The Supreme Court emphasized the importance of adhering to the interpretation of Section 24(2) as laid down by the Constitution Bench in Indore Development Authority Vs. Manoharlal and Ors. (2020) 8 SCC 129. The Court noted that the High Court had failed to appreciate the reasons for not taking actual vacant possession of the remaining land, which was under illegal occupation.

The Court quoted the following from Indore Development Authority Vs. Manoharlal and Ors. (2020) 8 SCC 129:
“The word “or” used in Section 24(2) between possession and compensation has to be read as “nor” or as “and”. 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 Court also stated:
“The expression “paid” in the main part of Section 24(2) of the 2013 Act does not include a deposit of compensation in court. The consequence of non-deposit is provided in the proviso to Section 24(2) in case it has not been deposited with respect to majority of landholdings then all beneficiaries (landowners) as on the date of notification for land acquisition under Section 4 of the 1894 Act shall be entitled to compensation in accordance with the provisions of the 2013 Act.”

The Court further clarified:
“In case a person has been tendered the compensation as provided under Section 31(1) of the 1894 Act, it is not open to him to claim that acquisition has lapsed under Section 24(2) due to non-payment or non-deposit of compensation in court. The obligation to pay is complete by tendering the amount under Section 31(1).”

The Court concluded that the High Court’s decision was unsustainable because it had failed to apply the correct interpretation of Section 24(2) of the Act, 2013.

Key Takeaways

• The Supreme Court clarified that the word “or” in Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, should be read as “nor” or “and.”
• Land acquisition proceedings will lapse under Section 24(2) only if both physical possession has not been taken and compensation has not been paid.
• If either possession has been taken or compensation has been paid, the acquisition proceedings will not lapse.
• Tendering the compensation as per Section 31(1) of the Land Acquisition Act, 1894, completes the obligation to pay.
• Non-deposit of compensation in court does not result in the lapse of land acquisition proceedings.

Directions

The Supreme Court quashed and set aside the judgment of the High Court and dismissed the original writ petition. The Court did not give any specific directions in this case.

Development of Law

The ratio decidendi of this case is that the word “or” in Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, should be read as “nor” or “and”. This interpretation clarifies that the acquisition proceedings will lapse only if both possession has not been taken and compensation has not been paid. This decision reaffirms the position of law laid down in Indore Development Authority Vs. Manoharlal and Ors. (2020) 8 SCC 129.

Conclusion

The Supreme Court’s judgment in Delhi Development Authority vs. Narvada Devi 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 word “or” in Section 24(2) should be read as “nor” or “and,” meaning that acquisition proceedings will lapse only if both possession has not been taken and compensation has not been paid. This decision reinforces the principle established in Indore Development Authority Vs. Manoharlal and Ors. (2020) 8 SCC 129, providing clarity on a crucial aspect of land acquisition law. The Supreme Court allowed the appeal of the Delhi Development Authority and set aside the High Court’s decision.