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2025 Supreme(Guj) 2025

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SUNITA AGARWAL, CJ, D.N. RAY, J.
Bholabhai Ramjibhai Patel HUF and Others – Appellants
Versus
State of Gujarat and Others – Respondents
Special Civil Application No. 8022 of 2023, Special Civil Application No. 9666 of 2019, Civil Application (For Amendment) No. 1 of 2025
Decided On : 16-09-2025

Advocates Appeared:
For the Appellant : Pushpadatta Vyas
For the Respondents: Sanjay Udhwani, Aditya S Patel, B.S. Patel, Umang H. Oza

The competent authority must consider all claims and provide hearings to all relevant parties before disbursing compensation; failure to do so renders such disbursements illegal.

Headnote:(A) National Highways Act, 1956 - Sections 3(H)(3), 3(G) - Disbursement of compensation - Original owners' failure to establish rights due to non-joinder of necessary parties and concealment of material facts resulted in a misconceived writ petition - Petitioners as transferees were denied a hearing by the competent authority which affected the legality of compensation disbursement - The order dated 30.04.2018 was set aside, emphasizing that rightful claimants must be heard in matters of compensation. (Paras 1, 10, 30, 32, 43)

(B) Concurrent Rights and Litigation - The court determined that original owners, having executed a later sale deed during the pendency of litigation, could not assert rights over the land or compensation - The ruling asserted that litigation tactics must not be used to circumvent rightful ownership claims and the need for full disclosure in court proceedings is paramount. (Paras 22, 31, 42)

Facts of the case:
The dispute involves the rightful claimant for compensation regarding land acquired under the National Highways Act, which originally belonged to the petitioners who sold it via a deed but were contested by transferees. The original owners filed actions seeking to cancel sales while claiming compensation was wrongly allocated to subsequent purchasers. The legal status of ownership had changed with the dismissal of previous suits while newer deeds were executed.

Findings of Court:
The Special Civil Application No. 9666 of 2019 was dismissed due to improper representation and failure to disclose critical facts, ruling the original owners forfeited their rights post the dismissal of their suit. The application by transferees, Special Civil Application No. 8022 of 2023, was upheld as they were denied representation in prior proceedings.

Issues: The core issues were the existence of rightful ownership of land, the competence of claims for compensation amid ongoing suits, and the legal process followed by the relevant authorities.

Ratio Decidendi: The court established that rightful ownership must be acknowledged, requiring the competent authority to confront all related claims before issuing disbursement orders for compensation, emphasizing the neglect of due process affected outcomes therein.

Result: The order dated 30.04.2018 was set aside, and respondents were ordered to refund compensation received.

Table of Content
1. dispute over land compensation (Para 1 , 2)
2. reliefs sought by original owners (Para 3 , 4 , 5 , 6)
3. claims of transferees regarding compensation (Para 10 , 11 , 12 , 16 , 22)
4. rejection of objections regarding compensation (Para 18 , 19 , 20 , 21 , 36)
5. rights to compensation tied to proper ownership (Para 28 , 30 , 39 , 40)
6. final judgment on entitlement to compensation (Para 31 , 42 , 44)

ORDER :

1. Heard Mr. Pushpadatta Vyas, learned advocate for the petitioners, Mr. Sanjay Udhwani, learned Assistant Government Pleader appearing for the State – respondents and Mr. B.S. Patel, learned Senior Advocate assisted by Mr. Umang H. Oza appearing for the respondent nos. 3 and 4 and perused the record.

2. The above referred two connected writ petitions are pertaining to a dispute of disbursement of compensation to the rightful owner of the agricultural land bearing Revenue Survey No.528/5 (Block No.961) at Village Sherkhi, District Vadodara (admeasuring 1-10-29 hectares), which was subject matter of the sale deed bearing No.9272 dated 15.09.2005 registered with the office of the Sale Registrar, Vadodara – Gorwa.

Special Civil Application No. 9666 of 2019:-

3. The Writ Petition No.9666 of 2019 was filed by the original owners who had executed a sale deed dated 15.09.2005 to transfer the land in question, with the reliefs prayed as under:-

A] YOUR LORDSHIPS maybe pleased to issue appropriate writ, direction or order and thereby be pleased to quashed and set aside the impugned order dated 30.04.2018 passed by the respondent no.2 as the same is bad, illegal and in clear violation of Section 3(H)(3) and (4) of the National Highways Act, 1956, and further be pleased to direct the respondent to deposit the amount of compensation before the Ld. Civil Court, in the interest of justice.

B] YOUR LORDSHIPS may be pleased to restrain the respondents, from executing the impugned order, pending the admission, hearing and final disposal of this petition;

C] YOUR LORDSHIPS maybe pleased to grant such other and further reliefs, as are deemed fit, in the interest of justice;

4. For the sake of convenience the petitioners of this writ petition are referred as the original owner throughout this judgment.

5. Pertinent is to note that in the writ petition filed by the original owner initially only two private respondents have been impleaded as respondent Nos. 3 and 4, in whose favour the order impugned dated 30.04.2018 had been passed, for disbursement of the compensation determined under the award dated 30.04.2018 declared under Section 3G of the National Highways Act, 1956 (in short referred as “the Act, 1956”). By means of the amendment allowed vide order dated 22.07.2025, however, the transferees of the sale deed dated 15.09.2005 have been brought on record as respondent Nos.5 and 6.1 to 6.5.

6. From a perusal of the averments made in writ petition, it is evident that it was stated that a Special Civil Suit No. 441 of 2006 had been filed against the transferees of the sale deed dated 15.09.2005 on the ground that the agreed amount of sale consideration was not paid to the writ petitioner and that the said suit was pending before the Senior Civil Judge, Vadodara.

7. However, the persons against whom the said suit was filed, were not impleaded initially.

8. Further there is also a reference of Regular Civil Suit No. 69 of 2018 filed by the transferees of the sale deed dated 15.09.2009 against the respondent Nos. 3 and 4 therein seeking for a declaration that the respondent nos. 3 and 4 are not entitled to receive compensation and the provisions of Section 3 (H) (4) of the Act, 1956 have been invoked praying to restrain the respondent authorities from disbursing the compensation to the respondent nos. 3 and 4 therein.

9. From the above, it is evident that Special Civil Application No.9666 of 2019 was not maintainable due to non-joinder of the necessary parties when it was instituted. However, with the subsequent impleadment of the transferees o

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