The main legal point established in the judgment is that the State Government is bound by the promises made and held out to the land owner, and that the doctrine of promissory estoppel applies in cases of rental compensation for lands acquired by private negotiations.

F.I. Rebello, J.

Rule. Heard forthwith.

1. Petitioner has approached this Court praying that the application made by the Petitioner for rental compensation dated 29/1/2008 be decided by Respondent No.3, who represents the acquiring body.

2. We may mention some facts from this Petition and refer to some additional facts from the other Petitions which are fixed today but in respect of which we propose to pass separate Orders based on the Judgment to be pronounced in this Petition.

3. The State of Maharashtra has issued Government Resolutions for payment of rental compensation where possession was taken from land owners by private negotiations before the Notification was issued under Section 4(1) of the Land Acquisition Act. The first such Resolution is of 1/12/1972. Para (6) of the said Resolution provides for payment of rental compensation. It sets out, the rental compensation would be paid ’for the period from the date on which possession of the land is taken over till the date on which full amount of final award is paid.’ The sub para determines the manner in which the rental compensation is to be paid. Sub para (i) of Para (6) sets out that the yearly rental compensation at the rate of 5% of the estimated value of the land is to be paid yearly to the land owners as soon as possession is taken over and the Collector of the District is to estimate the value of the land, or any Revenue Officer not below the rank of Tahasildar on his behalf, but not the concerned Land Acquisition Officer. It is further provided that the yearly rental compensation is to be provisional and should be paid up to the date on which the full amount of final award is paid to the land owner. The Government Resolution then records as under:-

"After the award is declared and the award value is known, final amount of rental compensation should be worked out at 6 and 1/2 percent of the award value and the balance amount if due, should be paid to the land owner within three months from the date the award value is paid."

It is thus clear that the rental compensation is payable on the award value, meaning thereby, the compensation as determined under Section 23 of the Land Acquisition Act.

Para (10) of this Government Resolution independently deals with the payment of compensation for crops which are standing on the land at the time of private negotiations. In other words, the value of the crop has to be independently assessed and paid in terms set out there, irrespective of the rental compensation as set out in Para (6) of the Resolution. Sub para (4) of Para (10) provides for a panchanama to be done of the condition of crop, trees etc. and while deciding to pay compensation for cash crops like sugar cane, fruit trees etc., it must be ensured that the plantation was done before the fact that the land was going to be acquired was known and that the land was capable of growing or sustaining the crop.

4. The Government Resolution of 1/12/1972 was amended by further Government Resolution dated 2/4/1979, whereby the rental compensation was increased from 6 and 1/2 % to 8 %.

5. The Government, thereafter, notified another Resolution dated 26/12/2003. This Government Resolution records that by Government Resolution dated 17/4/2003 the Government Resolution of 1/12/1972 has been cancelled and as a consequence also Government Resolution dated 2/4/1979. The said Government Resolution proceeds on the footing that there is no provision for rental compensation in the Land Acquisition Act and that this Court in one of its Judgment, has taken the view that acquisition of land by private negotiation is illegal and unconstitutional. However in the matter of payment of rental compensation, this is what the Government Resolution observes, in terms of the translation provided by the State Government reads:

"Accordingly though the provision of payment of rental compensation has been cancelled automatically, several matters are filed in the Court for payment of rental co