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2026 Supreme(Mad) 1508

IN THE HIGH COURT OF JUDICATURE AT MADRAS
Krishnan Ramasamy, J.
Tmt. Ponneeswari - Petitioner
Versus
The Union of India Represented by its Secretary to Government Ministry of Road Transport and Highways, New Delhi - Respondent
W.P No. 9915 of 2020 and WMP. No.12054 of 2020
Decided On : 08-04-2026

Advocates Appeared:
For the Petitioner: Mr. T. Saikrishnan
For the Respondent: Ms. V. Usha Additional Government Pleader

Owners entitled to compensation for gifted road portions in layouts upon statutory acquisition; gift does not divest ownership rights.

Headnote:The National Highways Act, 1956, particularly Section 3A(1), governs land acquisition for highway purposes. Petitioner acquired land via sale deeds, including portions later designated as road in unapproved layout, received compensation, but faced recovery demand post-acquisition. Court found no proper notice or hearing before repayment order, rejecting claim that gifted road portions vest automatically without registration. Key issue: Whether owners entitled to compensation for gifted common areas like roads in unapproved layouts upon government acquisition. Ratio: Gift deeds do not confer absolute ownership to local authorities; original owners retain entitlement to compensation for acquired portions, as affirmed in precedents distinguishing trustee-like role of local bodies. Impugned orders quashed; writ petition allowed.

Table of Content
1. summary of land purchase, acquisition, compensation payment, and impugned recovery orders. (Para 2)
2. arguments on ownership and vesting of road portions in unapproved layouts. (Para 3 , 4)
3. distinguishing prior rulings on street vesting versus gifted land rights. (Para 5 , 6 , 7 , 8)
4. owner entitled to compensation for gifted areas; orders quashed. (Para 9 , 10 , 11)

ORDER :

Krishnan Ramasamy, J.

This Writ Petition has been filed challenging the order of the 3rd respondent dated 29.01.2020 bearing Ref.No.9117/DCR/NHAI/B1/DPM-31, 31,33,34/111 and the Distraint Order of the 4th respondent dated 18.05.2020 and to quash the same.

2. The facts in nutshell are as follows:

(i) The petitioner purchased the subject lands vide sale deed dated 29.03.2014. Since certain portions of the land purchased by the petitioner were inadvertently omitted to be included in the sale deed, another sale deed came to be executed by the vendors in favour of the petitioner. By the said Sale Deed, a total extent of 4326 Sq.Ft. of land comprised in T.S.No.18/4, T.S.No.18/6, T..No.18/5 and T.S.No.18/7 were conveyed to the petitioner. Pursuant to the same, the petitioner was put in possession of the respective extents of lands and enjoying the same.

(ii) While so, on 30.01.2017, the 1st respondent issued a notification under Section 3A(1) of National Highways Act 1956 proposing to acquire lands including that of the petitioner. Pursuant to the same, the petitioner appeared before the 3rd respondent and submitted the sale deeds and also submitted a representation with respect to his entitlement to pay compensation and as such the petitioner’s account was credited with a sum of Rs.26,41,528/- as compensation for acquiring the lands. The respondents have also taken possession of the acquired lands. While so, to the shock and surprise of the petitioner, the 3rd respondent issued a impugned order dated 29.01.2020 calling upon the petitioner to repay the compensation amount on the premise that it has been decided to refer the cases relating to road portion in unapproved lay-outs to the concerned Departments of the Government of Puducherry. Such order came to be issued even without any notice to him and without hearing him. Further action was taken for recovery of the compensation amount by the 4th respondent, who has issued a Distraint Order dated 18.05.2020 under the Revenue Recovery Act authorizing the Village Administrative Officer of Keezhakasakudy village to attach and sell the petitioner’s properties and calling upon the petitioner to pay the compensation amount with interest @ 12% per annum on or before 03.03.2020. Hence, this petition.

2.1. The learned counsel appearing for the petitioner would submit that the petitioner is entitled to the compensation for the entire extent of lands that were gifted to the local authorities. Further he would submit that since the petitioner purchased the subject lands for valid consideration in a lawful and legal manner and the petitioner being the lawful owner of the subject lands, the compensation for the same cannot be deprived for certain extent by alleging that those extent of lands were shown as road portion. He further added that road portions cannot and would not vest on the Government or local bodies unless vested on them by registered instrument by the owners of the lands and it cannot be presumed or assumed that the owners lose their rights of ownership over such extents of lands and only after considering all these issues and determining by a legal process that the petitioner is entitled for compensation for the said extents of lands acquired that the compensation amount has been paid. Therefore, it is not open to the respondents to re-claim the said amount in an arbitrary manner. He therefore prays to quash the impugned orders. In support of his contention, he placed reliance on the Judgment of the Hon’ble Apex Court in the case of Association of Vasanth Apartments Owners vs. V. Gopinath and othe

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