Civil Appeal No.2994/2023

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

Civil Appeal No. 2994 of 2023

Delhi Development Authority … Appellant

Versus

Anita Singh & Ors. … Respondents

J U D G M E N T

Rajesh Bindal, J.

1. The order dated 22.08.2017 passed by the High

Court of Delhi in Writ Petition (C) No.5339/2016 has been

impugned before this Court. Vide aforesaid order, the Writ

Petition filed by the Respondent no.1 invoking Section 24(2) of

the Right to Fair Compensation and Transparency in Land

Acquisition, Rehabilitation and Resettlement Act, 2013

(hereinafter referred to as “the 2013 Act”) was allowed and it

was opined that acquisition in question has lapsed.

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2. The facts of the case as are available on record are

that the Respondent no.1 had filed a writ petition stating that

she had purchased 100 square yards bearing Khasra

No.140/9/1 situated in the Revenue Estate of Village Dichaun

Kalan Delhi by virtue of sale deed dated 04.03.2005. The said

land was subject matter of acquisition. A Notification under

Section 4 of the Land Acquisition Act, 1894 (hereinafter referred

to as “the 1894 Act”) was issued on 07.04.2006 which was

followed by a Notification under Section 6 of the 1894 on

04.04.2007. The Award was announced by the Land Acquisition

Collector on 30.12.2008 under Section 11 of the 1894 Act.

3. The writ petition was filed in the year 2016 invoking

Section 24(2) of the 2013 Act claiming that neither the

compensation has been paid to the Respondent no.1 nor the

possession of the land had been taken by the acquiring

authority, hence, the acquisition lapsed.

4. The stand taken by the Land Acquisition Collector in

the counter affidavit filed before the High Court was that the

possession of the acquired land was taken on 10.02.2012

except 3 biswas of land on which certain structure had been

build up. The Respondent no.1 not being the recorded owner of

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land, the compensation for the land, including the cases where

there was dispute regarding ownership, was deposited with the

Reference Court on 27.12.2013.

5. The High Court found that one of the conditions laid

down in Section 24(2) of the 2013 Act having not been

complied with regarding payment of compensation to the

Respondent no.1, the acquisition has lapsed.

6. The learned counsel for the appellant submitted that

in view of the Constitution Bench judgment of this Court in

Indore Development Authority v. Manoharlal and

Others

1

, whereby the earlier judgment of this Court in Pune

Municipal Corporation & Anr. v. Misirimal Solanki & Ors.

2

was overruled. The order passed by the High Court cannot be

legally sustained. It was opined by the Constitution Bench that

compliance of either of the two conditions i.e. taking over of

possession of the land or payment of compensation is sufficient

to sustain the acquisition. In the case in hand, it is the

admitted case of the Respondent no.1 that she was not the

recorded owner of the land though she claimed that the plot in

question was purchased by her vide sale deed dated

1 (2020) 8 SCC 129

2 (2014) 3 SCC 183

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04.03.2005. The land is being utilized by the Government for

construction of 100 Meter wide Road, under Planned

Development of Delhi. The land is required for UER-II, which is

connecting NH-1, NH-10 and NH-8 further connecting it to

NH-2. The said project is of great public importance and has to

be completed before 15 August 2023 in light of Amrit Mahotsav

(75 years of Independence). This will help in de-congestion of

Delhi and provide better connectivity to the public. As there

was dispute regarding ownership, the amount of compensation

was deposited with the Reference Court on 27.12.2013. The

same will amount to tendering the compensation as in case of

dispute of ownerships it could not have been paid to anyone.

Learned counsel for the appellant further submitted that the

Respondent no.1 herself had filed application on 06.05.2009

before the Land Acquisition Collector for release of

compensation. She clearly stated therein that though she is

not the recorded owner of the land, as she had purchased the

same through general power of attorney, the compensation

should not be paid to the recorded owner of the plot. This was

admission on the part of the Respondent no.1 that she had

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knowledge about acquisition of land. The order passed by the

High Court is liable to be set aside.

7. Heard learned counsel for the parties and perused

the paper books.

8. The Constitution Bench of this Court in Indore

Development Authority's case (supra) has opined that

satisfaction of either of the conditions namely either taking

possession of the acquired land or payment of compensation to

the landowners would be sufficient to save the acquisition from

being lapsed in terms of Section 24(2) of the 2013 Act. Various

questions posed before the Constitution Bench of this Court

were also answered. Relevant para-nos. 362 and 366 are

extracted below:

“362. Resultantly, the decision rendered in

Pune Municipal Corporation & Anr. (supra) is

hereby overruled and all other decisions in which

Pune Municipal Corporation (supra) has been

followed, are also overruled. …

...

366. In view of the aforesaid discussion, we

answer the questions as under:

366.1. Under the provisions of Section 24(1)

(a) in case the award is not made as on 1-1-

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2014, the date of commencement of the 2013

Act, there is no lapse of proceedings.

Compensation has to be determined under the

provisions of the 2013 Act.

366.2. In case the award has been passed

within the window period of five years excluding

the period covered by an interim order of the

court, then proceedings shall continue as

provided under Section 24(1)(b) of the 2013 Act

under the 1894 Act as if it has not been repealed.

366.3. The word “or” used in Section 24(2)

between possession and compensation has to be

read as “nor” or as “and”. The deemed lapse of

land acquisition proceedings under Section 24(2)

of the 2013 Act takes place where due to inaction

of authorities for five years or more prior to

commencement of the said Act, the possession

of land has not been taken nor compensation has

been paid. In other words, in case possession has

been taken, compensation has not been paid

then there is no lapse. Similarly, if compensation

has been paid, possession has not been taken

then there is no lapse.

(emphasis supplied)

366.4. The expression “paid” in the main part

of Section 24(2) of the 2013 Act does not include

a deposit of compensation in court. The

consequence of non- deposit is provided in the

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proviso to Section 24(2) in case it has not been

deposited with respect to majority of

landholdings then all beneficiaries (landowners)

as on the date of notification for land acquisition

under Section 4 of the 1894 Act shall be entitled

to compensation in accordance with the

provisions of the 2013 Act. In case the obligation

under Section 31 of the Land Acquisition Act,

1894 has not been fulfilled, interest under

Section 34 of the said Act can be granted. Non-

deposit of compensation (in court) does not

result in the lapse of land acquisition

proceedings. In case of non-deposit with respect

to the majority of holdings for five years or more,

compensation under the 2013 Act has to be paid

to the “landowners” as on the date of notification

for land acquisition under Section 4 of the 1894

Act.

366.5. In case a person has been tendered

the compensation as provided under Section

31(1) of the 1894 Act, it is not open to him to

claim that acquisition has lapsed under Section

24(2) due to non-payment or non- deposit of

compensation in court. The obligation to pay is

complete by tendering the amount under Section

31(1). The landowners who had refused to accept

compensation or who sought reference for higher

compensation, cannot claim that the acquisition

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proceedings had lapsed under Section 24(2) of

the 2013 Act.

366.6. The proviso to Section 24(2) of the

2013 Act is to be treated as part of Section 24(2),

not part of Section 24(1)(b).

366.7. The mode of taking possession under

the 1894 Act and as contemplated under Section

24(2) is by drawing of inquest

report/memorandum. Once award has been

passed on taking possession under Section 16 of

the 1894 Act, the land vests in State there is no

divesting provided under Section 24(2) of the

2013 Act, as once possession has been taken

there is no lapse under Section 24(2).

366.8. The provisions of Section 24(2)

providing for a deemed lapse of proceedings are

applicable in case authorities have failed due to

their inaction to take possession and pay

compensation for five years or more before the

2013 Act came into force, in a proceeding for

land acquisition pending with the authority

concerned as on 1-1-2014. The period of

subsistence of interim orders passed by court

has to be excluded in the computation of five

years.

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366.9. Section 24(2) of the 2013 Act does not

give rise to new cause of action to question the

legality of concluded proceedings of land

acquisition. Section 24 applies to a proceeding

pending on the date of enforcement of the 2013

Act i.e. 1-1-2014. It does not revive stale and

time-barred claims and does not reopen

concluded proceedings nor allow landowners to

question the legality of mode of taking

possession to reopen proceedings or mode of

deposit of compensation in the treasury instead

of court to invalidate acquisition.”

9. It is the admitted case of Respondent no.1 that she

was not the recorded owner of the land at the time of issuance

of Notification under Section 4 of 1894 Act or even at the time

of the passing of the Award. This is even mentioned in the

application dated 06.05.2009 filed by her to the Land

Acquisition Collector for release of compensation. This

establishes knowledge of acquisition and passing of award. On

account of fact that there was dispute of ownership, the

amount of compensation was deposited by the Land Acquisition

Collector with the Reference Court under Section 30/31 of the

1894 Act. On the issue of deposit of compensation with the

Reference Court, the position of law has been settled in Indore

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Development Authority’s case (supra). Paras 117, 118 and

119 thereof, which are extracted below:

“117. Payment of compensation under

the 1894 Act is provided for by Section 31 of the

Act, which is to be after passing of the award

under Section 11. The exception, is in case of

urgency under Section 17, is where it has to be

tendered before taking possession. Once an

award has been passed, the Collector is bound to

tender the payment of compensation to the

persons interested entitled to it, as found in the

award and shall pay it to them unless

“prevented” by the contingencies mentioned in

sub-section (2) of Section 31. Section 31(3)

contains a non obstante clause which authorises

the Collector with the sanction of the appropriate

Government, in the interest of the majority, by

the grant of other lands in exchange, the

remission of land revenue on other lands or in

such other way as may be equitable.

118. Section 31(1) enacts that the Collector

has to tender payment of the compensation

awarded by him to the persons interested

entitled thereto according to the award and shall

pay such amount to a person interested in the

land, unless he (the Collector) is prevented from

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doing so, for any of the three contingencies

provided by sub-section (2). Section 31(2)

provides for deposit of compensation in court in

case the State is prevented from making

payment in the event of:

(i) refusal to receive it;

(ii) if there be no person competent to

alienate the land;

(iii)if there is any dispute as to the title to

receive the compensation; or

(iv) if there is dispute as to the

apportionment.

In such exigencies, the Collector shall deposit the

amount of the compensation in the court to which

a reference under Section 18 would be submitted.

119. Section 34 deals with a situation where

any of the obligations under Section 31 is not

fulfilled i.e. when the amount of compensation is

not paid or deposited on or before taking

possession of the land, the Collector shall pay the

amount awarded with interest thereon @ 9% p.a.

from the time of so taking possession until it shall

have been so paid or deposited; and after one

year from the date on which possession is taken,

interest payable shall be @ 15% p.a. The scheme

of the 1894 Act clearly makes it out that when

the award is passed under Section 11, thereafter

possession is taken as provided under Section 16,

land vests in the State Government. Under

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Section 12(2), a notice of the award has to be

issued by the Collector. Taking possession is not

dependent upon payment. Payment has to be

tendered under Section 31 unless the Collector is

“prevented from making payment”, as provided

under Section 31(2). In case of failure under

Section 31(1) or 31(3), also Collector is not

precluded from making payment, but it carries

interest under Section 34 @ 9% for the first year

from the date it ought to have been paid or

deposited and thereafter @ 15%. Thus, once land

has been vested in the State under Section 16, in

case of failure to pay the compensation under

Section 31(1) or to deposit under Section 31(2),

compensation has to be paid along with interest,

and due to non-compliance of Section 31, there is

no lapse of acquisition. The same spirit has been

carried forward in the 2013 Act by providing in

Section 24(2). Once possession has been taken

though the payment has not been made, the

compensation has to be paid along with interest

as envisaged under Section 34, and in a case,

payment has been made, possession has not

been taken, there is no lapse under Section

24(2). In a case where possession has been taken

under the 1894 Act as provided by Section 16 or

17(1) the land vests absolutely in the State, free

from all encumbrances, if compensation is not

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paid, there is no divesting there will be no lapse

as compensation carries interest @ 9% or @ 15%

as envisaged under Section 34 of the 1894 Act.

The proviso to Section 24(2) makes some

wholesome provision in case the amount has not

been deposited with respect to majority of

landholdings, in such an event, not only those

persons but all the beneficiaries, though for

minority of holding compensation has been paid,

shall be entitled to higher compensation in

accordance with the provisions of the 2013 Act.

The expression used is “all beneficiaries specified

in the notification for acquisition under Section 4

of the said Land Acquisition Act” i.e. the 1894

Act, means that the persons who are to be paid

higher compensation are those who have been

recorded as beneficiaries as on the date of

notification under Section 4. The proviso gives

effect to, and furthers the principle that under the

1894 Act, the purchases made after issuance of

notification under Section 4 are void. As such, the

benefit of higher compensation under the proviso

to Section 24(2) is intended to be given to the

beneficiaries mentioned in the notification under

Section 4 of the 1894 Act.”

(emphasis supplied)

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10. Further, with reference to Section 24(2) of the

2013 Act, the position is summed up in para 208 of Indore

Development Authority’s case (supra), which is

extracted below:

“208. … … … In our opinion, when

amount has been tendered, the obligation has

been fulfilled by the Collector. Landowners cannot

be forced to receive it. In case a person has not

accepted the amount wants to take the

advantage of non-payment, though the amount

has remained (sic unpaid) due to his own act. It is

not open to him to contend that the amount has

not been paid to him, as such, there should be

lapse of the proceedings. Even in a case when

offer for payment has been made but not

deposited, liability to pay amount along with

interest subsist and if not deposited for majority

of holding, for that adequate provisions have

been given in the proviso also to Section 24(2).

The scheme of the 2013 Act in Sections 77 and

80 is also the same as that provided in Sections

31 and 34 of the 1894 Act.”

(emphasis supplied)

11. The issue as to what is meant by "possession of the

land by the State after its acquisition" has also been considered

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in Indore Development Authority’s case (supra). It is opined

therein that after the acquisition of land and passing of award,

the land vests in the State free from all encumbrances. The

vesting of land with the State is with possession. Any person

retaining the possession thereafter has to be treated

trespasser. When large chunk of land is acquired, the State is

not supposed to put some person or police force to retain the

possession and start cultivating on the land till it is utilized. The

Government is also not supposed to start residing or physically

occupying the same once process of the acquisition is

complete. If after the process of acquisition is complete and

land vest in the State free from all encumbrances with

possession, any person retaining the land or any re-entry made

by any person is nothing else but trespass on the State land.

Relevant paragraphs 244, 245 and 256 are extracted below:

"244. Section 16 of the Act of 1894

provided that possession of land may be taken

by the State Government after passing of an

award and thereupon land vest free from all

encumbrances in the State Government. Similar

are the provisions made in the case of urgency

in Section 17(1). The word "possession" has

been used in the Act of 1894, whereas in Section

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24(2) of Act of 2013, the expression "physical

possession" is used. It is submitted that drawing

of panchnama for taking over the possession is

not enough when the actual physical possession

remained with the landowner and Section 24(2)

requires actual physical possession to be taken,

not the possession in any other form. When the

State has acquired the land and award has been

passed, land vests in the State Government free

from all encumbrances. The act of vesting of the

land in the State is with possession, any person

retaining the possession, thereafter, has to be

treated as trespasser and has no right to

possess the land which vests in the State free

from all encumbrances.

245. The question which arises whether

there is any difference between taking

possession under the Act of 1894 and the

expression "physical possession" used in Section

24(2). As a matter of fact, what was

contemplated under the Act of 1894, by taking

the possession meant only physical possession

of the land. Taking over the possession under

the Act of 2013 always amounted to taking over

physical possession of the land. When the State

Government acquires land and drawns up a

memorandum of taking possession, that

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amounts to taking the physical possession of the

land. On the large chunk of property or

otherwise which is acquired, the Government is

not supposed to put some other person or the

police force in possession to retain it and start

cultivating it till the land is used by it for the

purpose for which it has been acquired. The

Government is not supposed to start residing or

to physically occupy it once possession has been

taken by drawing the inquest proceedings for

obtaining possession thereof. Thereafter, if any

further retaining of land or any re-entry is made

on the land or someone starts cultivation on the

open land or starts residing in the outhouse,

etc., is deemed to be the trespasser on land

which in possession of the State. The possession

of trespasser always inures for the benefit of the

real owner that is the State Government in the

case.

xxxx

 256. Thus, it is apparent that vesting

is with possession and the statute has provided

under Sections 16 and 17 of the Act of 1894 that

once possession is taken, absolute vesting

occurred. It is an indefeasible right and vesting

is with possession thereafter. The vesting

specified under Section 16, takes place after

various steps, such as, notification under Section

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4, declaration under Section 6, notice under

Section 9, award under Section 11 and then

possession. The statutory provision of vesting of

property absolutely free from all encumbrances

has to be accorded full effect. Not only the

possession vests in the State but all other

encumbrances are also removed forthwith. The

title of the landholder ceases and the state

becomes the absolute owner and in possession

of the property. Thereafter there is no control of

the landowner over the property. He cannot

have any animus to take the property and to

control it. Even if he has retained the possession

or otherwise trespassed upon it after possession

has been taken by the State, he is a trespasser

and such possession of trespasser enures for his

benefit and on behalf of the owner."

(emphasis supplied) 

12. As per the stand taken by the appellant, the land in

question is being utilised for UER-II, which is connecting NH-1,

NH-10 and NH-8 further connecting it to NH-2. The said project

is of great public importance and has to be completed before

15.08.2023 in light of Amrit Mahotsav (75 years of

Independence). This will help in de-congestion of Delhi.

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13. From the facts as are available on record, it is evident

that Respondent no.1 was admittedly not the recorded owner of

the land at time of acquisition thereof or pronouncement of

Award by the Land Acquisition Collector. The amount of

compensation was deposited with the Reference Court in term

of Section 30/31 of the 1894 Act as the same could not be paid

to Respondent no.1. Hence, one of the conditions being

satisfied, in our view the order passed by the High Court cannot

be legally sustained whereby the acquisition has been held to

have lapsed in terms of Section 24(2) of the 2013 Act.

14. The appeal is accordingly allowed and the impugned

order passed by the High Court is set aside. The Writ Petition

filed by the Respondent no.1 in the High Court is dismissed.

______________, J.

(Abhay S. Oka)

______________, J.

(Rajesh Bindal)

New Delhi

May 01, 2023.

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