A beneficiary of land acquisition is a "person interested" under the Land Acquisition Act and must be impleaded and heard before compensation is enhanced, as failure to do so violates the principles of natural justice (audi alteram partem).

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE A WRIT OF CERTIORARI QUASHING THE IMPUGNED ORDER DATED 16-10-2019 PASSED BY II ADDL. SENIOR CIVIL JUDGE AND JMFC, BAGALKOT IN LAC NO. 23/2016 WHICH IS PRODUCED AT ANNEXURE-A; ISSUE SUCH OTHER WRIT OR ORDER OR DIRECTION AS THIS HON’BLE COURT DEEMS FIT INCLUDING AN ORDER AS TO COSTS IN THE INTEREST OF JUSTICE AND EQUITY AND ETC.

THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

CORAM: THE HON'BLE MRS JUSTICE K.S.HEMALEKHA

ORAL ORDER

The petitioner, claiming to be the beneficiary of the acquisition proceedings initiated under the provisions of the Karnataka Industrial Areas Development Act, 1966 (“KIAD Act” for short), has called in question the judgment and award dated 16.10.2019 passed in LAC No.23/2016 on the file of the II Additional Senior Civil Judge and JMFC, Bagalkot (“Reference Court” for short), on the ground that the said award is passed without impleading the petitioner and without affording it an opportunity of hearing.

Brief Facts:

The land bearing R.S.No.17/1 measuring 11 acres 35 guntas situated at Achanur village of Bagalkot Taluk of Bagalkot District, was acquired pursuant to a preliminary notification issued under Sections 1(3), 3(1) and 28(1) of the KIAD Act for an industrial purpose, for the benefit of the petitioner-company. An award came to be passed by the Special Land Acquisition Officer on 22.01.2016.

Being dissatisfied with the award passed, respondent No.1 sought reference under Section 18(1) of the Land Acquisition Act, 1894 (“the Act” for short), which was registered as LAC No.23/2016. The Reference Court, by the judgment and award dated 16.10.2019 partly allowed the claim and enhanced the compensation.

Subsequently, respondent No.1 initiated proceedings in E.P.No.123/2023. In the said proceedings, the Executing Court, by order dated 08.07.2024 issued attachment warrant of movables of respondent No.2. The petitioner asserts that it was neither impleaded in the reference proceedings nor in the execution proceedings and that came to know about the impugned award only on receipt of the intimation regarding attachment, compelling the petitioner to approach this Court.

Learned counsel for the petitioner submits that the petitioner, being the beneficiary of the acquisition squarely falls within the expression, “person interested” under Section 50(1) the Act. It is contended that the Reference Court proceeded to enhance the compensation without affording an opportunity to the petitioner to participate in the proceedings or adduce evidence on question of market value.

It is submitted that non-impleadment of the beneficiary and denying an opportunity of hearing is a fatal to the award as enhanced compensation ultimately fastened financial liability of the beneficiary. Reliance is placed upon the judgment of the Apex Court in the case of Union of India Vs. District Judge, Udhampur , 1994(4) SCC 737, (“District Judge” for short) to contend that the beneficiary of an acquisition is entitled to participate in the acquisition proceedings.

Learned counsel for respondent No.1 supports the impugned judgment and award passed by the Reference Court.

This Court has carefully considered the rival submissions and perused the material on record.

It is not in dispute that the reference proceedings in LAC.No.23/2016 were conducted without impleading the petitioner and without affording it an opportunity to participate in the proceedings. Law is well settled that though a beneficiary may not be entitled to seek a reference under Section 18 of the Act, the beneficiary is nevertheless a “person interested” within the meaning of Section 50(1) of the Act and is entitled to participate in the proceedings relating to determination of compensation. The judgment and award dated 16.10.2019 having been passed behind the back of the