1. Land acquisition under urgency provisions — Non-payment of eighty per cent estimated compensation — Failure to pass award within statutory period — Claim for lapsing of proceedings. (Para 4 , 5 )
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2022 Supreme(SC) 1050
SUPREME COURT OF INDIA
S. Abdul Nazeer, A.S. Bopanna, V. Ramasubramanian, JJ.
Delhi Airtech Services Pvt. Ltd & Anr. – Appellants
Versus
State of U.P & Anr. – Respondents
Civil Appeal No. 24 of 2009
Decided On : 14-10-2022
Advocates appeared:
For the Appellant(s) : Mr. Rakesh Singh, Adv. Mr. Arun K. Sinha, AOR Mr. Rohan Goel, Adv.
For the Respondent(s): Mr. Ravindra Raizada, AAG/ Sr. Adv. Mr. Rajeev Kumar Dubey, Adv. Mr. Ashiwan Mishra, Adv. Ms. Vaidruti Mishra, Adv. Mr. Kamlendra Mishra, AOR Mr. Ravindra Kumar, Sr. Adv. Mr. Binay Kumar Das, AOR Ms. Priyanka Das, Adv. Ms. Neha Das, Adv. Mr. Ajai Kumar, Adv. Mr. Dinesh Kumar Garg, AOR Mr. Abhishek Garg, Adv. Mr. Dhananjay Garg, Adv. Mr. Ishaan Tiwari, Adv. Mr. R.P. Bansal, Adv. Mr. Chankya Gupta, Adv.
For the Appellant(s) : Mr. Rakesh Singh, Adv. Mr. Arun K. Sinha, AOR Mr. Rohan Goel, Adv.
For the Respondent(s): Mr. Ravindra Raizada, AAG/ Sr. Adv. Mr. Rajeev Kumar Dubey, Adv. Mr. Ashiwan Mishra, Adv. Ms. Vaidruti Mishra, Adv. Mr. Kamlendra Mishra, AOR Mr. Ravindra Kumar, Sr. Adv. Mr. Binay Kumar Das, AOR Ms. Priyanka Das, Adv. Ms. Neha Das, Adv. Mr. Ajai Kumar, Adv. Mr. Dinesh Kumar Garg, AOR Mr. Abhishek Garg, Adv. Mr. Dhananjay Garg, Adv. Mr. Ishaan Tiwari, Adv. Mr. R.P. Bansal, Adv. Mr. Chankya Gupta, Adv.
Compliance with Section 17(3-A) of the Land Acquisition Act, 1894 is mandatory for absolute vesting of the notified land, and the requirement to pass the award within the time frame contemplated under Section 11-A is applicable to the acquisition notified under Section 17.
Headnote:
Land Acquisition Act - Acquisition of Land - Section 17(3-A) - Summary
Fact of the Case:
The New Okhla Industrial Development Authority (NOIDA) was to implement a planned Industrial layout in Gautam Budh Nagar District for which land was to be acquired. The Appellant, a company, claimed to be the owner of a small extent of land included in the acquisition. The Appellant alleged non-compliance with the Land Acquisition Act, 1894, and filed a writ petition.
Finding of the Court:
The Court held that compliance with Section 17(3-A) of the Act is mandatory for absolute vesting of the notified land. The Court also found that the requirement to pass the award within the time frame contemplated under Section 11-A is applicable to the acquisition notified under Section 17. The Court concluded that the acquisition would lapse if the pre-requisite condition of payment of 80% of the estimated compensation before taking possession is not complied.
Issues: 1. Compliance with Section 17(3-A) of the Land Acquisition Act, 1894. 2. Requirement to pass the award within the time frame contemplated under Section 11-A. 3. Applicability of the decision in Satendra Prasad Jain v. State of U.P. to the above questions.
Ratio Decidendi: Compliance with Section 17(3-A) is mandatory for absolute vesting of the notified land. The requirement to pass the award within the time frame contemplated under Section 11-A is applicable to the acquisition notified under Section 17. The decision in Satendra Prasad Jain v. State of U.P. does not limit or restrict the rights of landowners to fair compensation for their expropriated property.
Final Decision: The Court directed the respondents to determine the market value of the appellant's land by reckoning the relevant date as the date of the award. The Court also clarified that the determination of compensation in this case shall not give rise to any right in favor of any other land loser whose land was acquired under the same notification to seek redetermination of compensation.
Legal Category Hierarchy
Table of Contents
2. Whether Section 11-A applies to urgency acquisitions — Whether payment under Section 17(3A) is mandatory for absolute vesting — Whether non-compliance leads to lapsing of acquisition. (Para 5 , 6 )
3. Section 17(3A) is mandatory for absolute vesting — Absolute vesting prevents lapsing under Section 11-A — Non-compliance with Section 17(3A) renders acquisition subject to lapsing under Section 11-A. (Para 11 , 12 , 13 , 14 , 15 , 16 , 17 )
4. Acquisition under Section 17 lapses under Section 11-A if eighty per cent estimated compensation is not paid before possession, as absolute vesting does not occur. (Para 15 , 16 , 17 )
5. Relief moulded due to land utilization — Market value determined as of award date — Statutory benefits calculated from notification date — Costs awarded to appellant. (Para 23 , 24 , 26 )
6. Does Section 11-A apply to acquisitions initiated under the urgency provisions of Section 17?
Yes, Section 11-A is applicable to acquisitions under Section 17. However, its effect depends on whether the mandatory pre-requisites for absolute vesting under Section 17(3A) were complied with before possession was taken. (Para 12 , 17 )
7. Is the payment of eighty per cent estimated compensation under Section 17(3A) mandatory?
Yes, the use of the word shall makes it mandatory to tender and pay eighty per cent of the estimated compensation before taking possession. This payment is a sine qua non for the land to vest absolutely in the government. (Para 12 )
8. Under what conditions does an urgency acquisition lapse under Section 11-A?
If the mandatory payment under Section 17(3A) is not made before possession, absolute vesting does not occur. In such circumstances, the acquisition will lapse if the award is not passed within two years from the date of declaration. (Para 15 , 16 , 17 )
9. Does absolute vesting under Section 17 prevent the proceedings from lapsing under Section 11-A?
Yes, if eighty per cent of the estimated compensation is tendered and paid, the land vests absolutely in the government. In such an event, the rigour of Section 11-A does not render the acquisition proceedings lapsed. (Para 15 , 17 )
10. Can the acquiring authority invoke Section 11-A to claim lapsing based on its own non-compliance with Section 17(3A)?
No, the benefits of Section 11-A and Section 17(3A) are intended for the land loser. The acquiring authority cannot derive a benefit from its own failure to comply with the law to claim a lapse. (Para 16 , 17 , 20 )
JUDGMENT :
A.S. Bopanna, J.
1. This appeal has a chequered history. The appeal was heard by a Bench consisting of two Hon’ble Judges (Justice A.K. Ganguly and Justice Swatanter Kumar) and was decided by the Judgment dated 18.08.2011 with divergent opinion. In the process, after consideration, Hon’ble Justice A.K. Ganguly arrived at the conclusion that taking over possession of the land without complying the requirement under Section 17(3-A) of the Land Acquisition Act, 1894 (for short ‘Act, 1894’) is clearly illegal and in violation of the statutory provision which automatically violates the constitutional guarantee under Article 300A of the Constitution. However, on taking note that the land had been utilised and developed by the beneficiary of the acquisition, had allowed the retention of the land by directing to pass an award by construing the date of filing the writ petition i.e. 01.03.2006 as the date of Section 4 notification to reckon the market value as against the actual date of notification. Hence allowed the appeal in those terms.
2. On the other hand, Hon’ble Justice Swatanter Kumar, however, disagreed with the said conclusion and for the separate reasons assigned by the learned Judge, arrived at the conclusion that Section 11-A of Act, 1894 has no application to acquisition under Section 17 of Act, 1894. It was further held that the default in complying with Section 17(3-A) of Act, 1894 does not invalidate or vitiate the entire acquisition proceedings. The learned Judge while deciding so had however misconstrued that 80% of the estimated value in terms of sub-section (3A) of Section 17 had been paid to the land loser and in that context held that the interest provided in terms of Section 34 will be payable. In that view, the learned Judge ordered dismissal of the appeal in terms of the directions issued.
3. In that backdrop, in view of the divergence of opinion between the learned Judges, they had ordered the matter to be placed before Hon’ble the Chief Justice of India for reference to a larger Bench to resolve the conflict. It is in that circumstance Hon’ble the Chief Justice has ordered the matter to be placed before a Bench consisting of three Judges. However, no specific question has been formulated and referred for decision by a three-member Bench. Hence, we have heard the matter based on the factual aspects involved in this case denovo, so as to determine the legal aspects which touch upon the same.
4. It would therefore be necessary for us to at the outset take note of the factual matrix involved in this case. The New Okhla Industrial Development Authority (NOIDA) – Respondent No.2 was to implement a planned Industrial layout in Gautam Budh Nagar District for which purpose the requisite land was to be acquired. The project was envisaged by the State of U.P–Respondent No.1 as a part of planned Industrial Development. Hence, Respondent No.1 being the appropriate Government, issued the Notification dated 17.04.2002 invoking the special power due to urgency. The Notification was therefore issued under Section 4(1) read with Section 17(1) and (4) of Act, 1894, whereby the requirement of procedure under Section 5A of the Act, 1894 was dispensed. Pursuant thereto, the declaration under Section 6 of the Act, 1894 was notified and published on 22.08.2002 declaring that the area was required by the Government for planned industrial development. It was also stated that after the expiry of 15 days from the date of publication of notification under sub-section (1) of Section 9 of the Act, 1894, possession of the acquired land will be taken.
5. In the large extents of land that was notified, an extent measuring 2-06-1/3-0 Bighas situated in village Haldauni, Tehsil and Pargana Dadri, District Gautam Budh Nagar, an ‘Abadi’ land was also included. The Appellant, a company incorporated under the provisions of the Companies Act, 1956 claims to be the owner of the said small extent of land. The Appellant alleges that they were not
