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CASE NO.:

Appeal (civil) 443 of 2001

PETITIONER:

ISHWAR DUTT

RESPONDENT:

LAND ACQUISITION COLLECTOR and ANR.

DATE OF JUDGMENT: 02/08/2005

BENCH:

ASHOK BHAN & S.B. SINHA

JUDGMENT:

JUDGMENT

BHAN,ASHOK J.

Claimants/appellants aggrieved against the common/similar judgments and

orders dated 20.12.1999 passed by the High Court of Himachal Pradesh

dismissing their claim for interest @ 12% granted by an earlier order of

the Division Bench of the same High Court in C.W.P. No. 510/85 dated

9.9.1985 on equitable consideration for depriving them of their lands

without taking proceedings under the Land Acquisition Act and payment of

compensation have come up in these batch of appeals.

Facts being common and similar it would be sufficient to refer to the facts

of CA No. 443 of 2001 for the purposes of deciding the controversy involved

in these appeals.

Some areas of Himachal Pradesh before re-organisation of the State of

Punjab on 1.11.1966 formed part of the erstwhile State of Punjab. Public

Works Department, Government of Punjab in the year 1966 took up the

construction of Solan-Jawanji-Dharja Road. After the re-organisation of the

States on 1.11.1966 the PWD Department of H.P. took over the construction.

The road was finally commissioned in the year 1968. Possession of the land

owned by the appellants comprising of Khasra No. 102/1 situated in Village

Bagur, Tehsil and District Solan, along with the lands of large number of

villages that came under the said road construction plan was taken over in

the year 1968. Though the possession of the land was taken over from the

Land-owners in December, 1968 no steps were taken to formally acquire the

land by issuing notification under Section 4 of the Land Acquisition Act,

1894 [hereinafter referred to as "the Act"].

Having failed to secure justice to get any compensation or even step being

taken by the Government for acquiring the land of nearly 17 years, a public

interest writ petition No. 510 of 1985 titled Chander Kant Sharma and Ors.

v. State of Himachal Pradesh, was filed. The State of Himachal Pradesh

failed to justify any valid reasons for not taking steps to get the land

acquired and for not paying any compensation to the Land-owners. Finding

grievance of the writ petitioners to be genuine the High Court vide its

judgment and order dated 9.9.1985 directed the respondents to complete the

acquisition proceedings within a time frame and further directed them to

pay to the writ petitioners interest @ 12% per annum from the date of

taking over of possession till the date of payment of interim compensation

and of final compensation, if there is enhancement. It was observed that

the aforesaid interest payable was in the nature of equitable compensation

and such interest shall be in addition to the compensation, solatium and

interest at the statutory rate which would be paid to the writ petitioners

under the law whether awarded by the Collector or enhanced by the Court and

such interest shall not be taken into consideration in any proceeding under

the Act while awarding the statutory compensation (direction No. 3). The

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Division Bench gave the following directions for expeditious relief to the

writ petitioners:

"1. The acquisition proceedings in respect of villages Ser Chirag, Tawa

Talara and Gatool shall be completed on or before January 31, 1986 and

those in respect of land situate in village Deon Dhar shall be completed on

or before June 30, 1986.

2. The petitioners shall be paid as and by way of interim compensation,

without prejudice to their rights and contentions to claim the compensation

due to them in accordance with law in the course of the proceedings under

the Act, a sum determined on the basis of the tentative market value set

out in column No. 9 of the statements in a tabular form annexed to the

affidavits of the Superintending Engineer and the Land Acquisition Officer.

The interim compensation will be paid to the petitioners after explaining

the aforesaid position to them against a receipt to be executed by them

acknowledging the payment towards the ultimate compensation to which they

become entitled in accordance with law. The payment will be made within a

period of four weeks from today.

3. On the amount of compensation payable to the petitioners, interest at

the rate of 12 per cent per annum shall be paid from the date of the taking

over of possession till the date of payment of interim compensation and of

final compensation, if there is enhancement. The interest payable

accordingly is in the nature of an equitable compensation and such interest

will be in addition to the compensation, solatium and interest at the

statutory rate which will be paid to the petitioners under the law, whether

awarded by the Collector of enhanced by the Court, and such interest will

not be taken into consideration in any proceeding under the Act, while

awarding the statutory compensation.

4. The tabular statement appended to the affidavits of the Superintending

Engineer and the Land Acquisition Collector gives the requisite information

relating to the land situate in other eleven villages which has been taken

possession of for the purposes of the construction of the road in question.

The land-owners, whose land in those villages has been taken possession of,

will also be entitled to similar treatment. Under the circumstances, in

order to ensure similar treatment being accorded to persons identically

situate as the petitioners and in order to avoid proliferation of

limitation, it appears to be just and proper to direct that the land-

owners, whose land situate in those eleven villages has also been taken

possession of for the purposes of the construction of the road in question,

will also be entitled to the payment of interim compensation and equitable

compensation on the same basis as the petitioners herein and that in those

cases also, the acquisition proceedings shall be completed on or before

January 31, 1986 and June 30, 1986, as the case may be, depending upon

whether or not the acquisition proceedings have been initiated under

Section 4 of the Act."

As the writ petition had been filed in public interest, in the direction

No. 4 it was ordered by the Court that all the Land-owners whose land had

been taken possession of in either of the awards would be entitled to the

similar relief.

Some other petitioners filed CWP No. 125 of 1986 and CWP No. 147 of 1988

which were also disposed of with the similar directions.

As a result of the directions issued by the High Court in its order dated

9.9.1985 the respondents issued the notification under Section 4 of the Act

for Village Bagure vide Notification No. Lok-Nirmn (Kha) - 7 (1)/62/88

dated 25.2.1989 published in the H.P. Gazette dated 15.4.1989. The Land

Acquisition Collector completed the formalities of acquiring the land and

ultimately by its award No. 27/1990 dated 31.1.1991 fixed the market value

of the land at Rs. 9,727 per bigha. Apart from the statutory benefits of

solatium etc. the land-owners were also awarded the interest @ 12% p.a.

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from the date of taking over of possession till the date of payment as

directed by the Division Bench in its order dated 9.9.1985 on equitable

grounds.

Being aggrieved against the market value fixed by the Land Acquisition

Collector the appellants filed an application seeking reference under

Section 18 of the Act to the District Judge. The District Judge, Solan vide

its award dated 1.9.1992 enhanced the compensation to Rs. 45,000 per bigha.

It was held that the land-owners were entitled to compensation at the rate

of Rs. 45,000 per bigha and that they shall be further entitled to :

"(a) Compulsory acquisition charges at the rate of 30% on the market

value assessed above;

(b) Additional compulsory acquisition charges at the rate of 12% per

annum on the market value assessed above with effect from the date of

notification under Section 4 of the Act of 1894, that is, 7.5.1989, till

the date of the award, that is, 31.1.1991,.

(c) Interest at the rate of 12% per annum on the compensation assessed

above with effect from 18.12.1968 till the date of payment of compensation

in terms of the orders of the Hon'ble High Court in CWP No. 147/ 1988;

(d) Interest at the rate of 9% per annum on the enhanced compensation

from the date of possession, that is, 18.12.68 till the date of expiry of

one year thereafter, that is, 17.12.1969;

(e) Interest at the rate of 15% per annum of the enhanced amount with

effect from 18.12.1969 till the date of payment of the amount in Court."

The Respondents being aggrieved by and dissatisfied with the said award

preferred a First Appeal under Section 54 of the Act before the High Court

which was marked as Regular First Appeal No. 104 of 1993. By reason of the

impugned judgment, a Division Bench of the High Court while upholding the

amount of compensation payable to the Appellant herein for acquisition of

the land set aside that part of the award, purported to be relying on or on

the basis of the decision of this Court in State of Himachal Pradesh and

Ors v. Dharam Das, AIR (1996) SC 127, complying the payment of interest

only with effect from 7.5.1989 or with effect from the date of publication

of the notification under Section 4(1) of the Act and not from 18.12.1968.

In Dharam Das, (supra) the State of Himachal Pradesh had filed an appeal

against the judgment rendered in C.W.P. No.125 of 1986, [State of Himachal

Pradesh and Ors. v. Dharam Das], in which a direction similar to the one

which had been given by the High Court in C.W.P. No.510 of 1985, [Chander

Kant Sharma and Ors. v. The State of Himachal Pradesh through the Secretary

and Anr.] was given. This Court did not approve of the view taken by the

High Court and a contra view was taken by holding that the amount other

than the one envisaged either under Section 23 (1-A) of the Act or under

any of the provisions of the Act could not be granted on equitable grounds.

SUBMISSIONS :

The learned counsel appearing on behalf of the Appellant submitted that

having regard to the fact that the appeal preferred by the Respondents

herein was confined to the quantum of compensation and as they did not

question the order of the High Court dated 9.9.1985 passed in C.W.P. 510 of

1985, the impugned judgment cannot be sustained.

The learned counsel would contend that in any view of the matter the

decision of this Court in Dharam Das, (supra) could not have been relied

upon as the principles of res judicata would be attracted to the fact of

the present case and furthermore in view of the fact that the said order

has been acted upon.

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The learned counsel appearing on behalf of the Respondent, however,

supported the judgment and submitted that no interest can be granted on the

date of possession. Reliance in this behalf has been placed on R.L. Jain

(D) By LRs. v. DDA and Ors., [2004] 4 SCC 79.

FINDINGS :

It is not in dispute that the High Court issued a writ of mandamus. It is

also not in dispute that the direction of the High Court was acted upon.

The principle of res judicata, as is well-known, would apply in different

proceedings arising out of the same course of action but would also apply

in different stages of the same proceedings. As the judgment and order

passed in C.W.P. No. 510 of 1985 attained finality, we are of the opinion

that the Respondents herein could not have raised any contention contrary

thereto or inconsistent therewith in any subsequent proceedings. In fact

the Land Acquisition Officer while passing the award on 31.1.1991 took into

consideration the said direction and awarded 12% additional compensation at

the market value. The said order of the Land Acquisition Officer never came

to be questioned and, thus, attained finality.

Section 18 of the Act provides that any person who has not accepted the

award may file an application for referring the dispute for determination

of the court inter alia as regard the amount of compensation.

The State could have filed such an application under Section 18. It did not

choose to do so. Only the Appellant herein took recourse to the said

provision culminating in passing of the impugned judgment of the High

Court.

Thus, the award of the Land Acquisition Officer directing payment of

additional interest has also attained finality.

In the Reference Court or for that matter the High Court exercising its

appellate jurisdiction under Section 54 of the Act could not have dealt

with the said question. The principle of res judicata is species of the

principle of estoppel. When a proceeding based on a particular cause of

action has attained finality, the principle of res judicata shall fully

apply.

Reference in this regard may be made to Wade and Forsyth on Administrative

Law, 9th Ed., pg. 243, wherein it is stated:

"One special variety of estoppel is res judicata. This results from the

rule which prevents the parties to a judicial determination from litigating

the same question over again even though the determination is demonstrably

wrong. Except in proceedings by way of appeal, the parties bound by the

judgment are estopped from questioning it. As between one another they may

neither pursue the same cause of action again, nor may they again litigate

any issue which was an essential element in the decision. These two aspects

are sometimes distinguished as `cause of action estoppel' and `issue

estoppel.'

In Hope Plantations Ltd. v. Taluk Land Board, Peermade and Anr., [1999] 5

SCC 590, this Court observed :

"Law on res judicata and estoppel is well understood in India and there are

ample authoritative pronouncements by various courts on these subjects. As

noted above, the plea of res judicata, though technical, is based on public

policy in order to put an end to litigation. It is, however, different if

an issue which had been decided in an earlier litigation again arises for

determination between the same parties in a suit based on a fresh cause of

action or where there is continuous cause of action. The parties then may

not be bound by the determination made earlier if in the meanwhile, law has

changed or has been interpreted differently by a higher forum..."

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In `The Doctrine of Res Judicata' 2nd Edition by George Spencer Bower and

Turner, it is stated :

"A judicial decision is deemed final, when it leaves nothing to be

judicially determined or ascertained thereafter, in order to render it

effective and capable of execution, and is absolute, complete, and certain,

and when it is not lawfully subject to subsequent rescission, review, or

modification by the tribunal which pronounced it...."

Reference, in this connection, may also be made to Ram Chandra Singh v.

Savitri Devi and Ors., JT (2005) 11 SC 439.

Yet recently in Swamy Atmananda and Ors. v. Sri Ramakrishna Tapovanam and

Ors., JT (2005) 4 SC 472 in which one of us was a party, this Court

observed:

"The object and purport of principle of res judicata as contained in

Section 11 of the Code of Civil Procedure is to uphold the rule of

conclusiveness of judgment, as to the points decided earlier of fact, or of

law, or of fact and law, in every subsequent suit between the same parties.

Once the matter which was the subject-matter of lis stood determined by a

competent court, no party thereafter can be permitted to reopen it in a

subsequent litigation. Such a rule was brought into the statute book with a

view to bring the litigation to an end so that the other side may not be

put to harassment.

The principle of res judicata envisages that a judgment of a court

of concurrent jurisdiction directly upon a point would create a bar

as regards a plea, between the same parties in some other matter in

another court, where the said plea seeks to raise afresh the very

point that was determined in the earlier judgment."

It was further noticed:

"In Ishwardas v. the State of Madhya Pradesh and Ors., AIR (1979) SC 551,

this Court held:

"...In order to sustain the plea of res judicata it is not necessary that

all the parties to the two litigations must be common. All that is

necessary is that the issue should be between the same parties or between

parties under whom they or any of them claim..."

Yet again in Arnold v. National Westminster Bank Plc., [1991] 3 ALL ER 41,

the House of Lords noticed the distinction between cause of action estoppel

and issue estoppel. Cause of action estoppel arises where the cause of

action in the later proceedings is identical to that in the earlier

proceedings, the latter having been between the same parties or their

privies and having involved the same subject-matter. In such a case, the

bar is absolute in relation to all points decided unless fraud or collusion

is alleged, such as to justify setting aside the earlier judgment. The

discovery of new factual matter which could not have been found out by

reasonable diligence for use in the earlier proceedings does not, according

to the law of England, permit the latter to be reopened. Issue estoppel may

arise where a particular issue forming a necessary ingredient in a cause of

action has been litigated and decided and in subsequent proceedings between

the same parties involving a different cause of action to which the same

issue is relevant, one of the parties seeks to reopen that issue. Here also

bar is complete to relitigation but its operation can be thwarted under

certain circumstances. The House then finally observed: but there is room

for the view that the underlying principles upon which estoppel is based,

public policy and justice have greater force in cause of action estoppel,

the subject-matter of the two proceedings being identical, than they do in

issue estoppel, where the subject-matter is different. Once it is accepted

that different considerations apply to issue estoppel, it is hard to

perceive any logical distinction between a point which was previously

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raised and decided and one which might have been but was not. Given that

the further material which would have put an entirely different complexion

on the point was at the earlier stage unknown to the party and could not by

reasonable diligence have been discovered by him, it is hard to see why

there should be a different result according to whether he decided not to

take the point, thinking it hopeless, or argue it faintly without any real

hope of success.

In Gulabchand Chhotalal Parikh v. State of Gujarat, AIR (1965) SC 1153 the

Constitution Bench held that the principle of res judicata is also

applicable to subsequent suits where the same issues between the same

parties had been decided in an earlier proceeding under Article 226 of the

Constitution.

It is trite that the principle of res judicata is also applicable to the

writ proceedings. [See Himachal Pradesh Road Transport Corporation v.

Balwant Singh, [1993] Supp 1 SCC 552].

In Bhanu Kumar Jain v. Archana Kumar and Anr., [2005] 1 SCC 787, it was

held:

"It is now well-settled that principles of res judicata applies in

different stages of the same proceedings. [See Satyadhyan Ghosal and Ors.

v. Smt. Deorajin Debi and Anr., AIR (1960) SC 941 and Prahlad Singh v. Col.

Sukhdev Singh, [1987] 1 SCC 727].

In Y.B. Patil (supra) it was held:

"4... It is well settled that principles of res judicata can be invoked not

only in separate subsequent proceedings, they also get attracted in

subsequent stage of the same proceedings. Once an order made in the course

of a proceeding becomes final, it would be binding at the subsequent state

of that proceeding..."

It was further observed:

"In a case of this nature, however, the doctrine of `issue estoppel' as

also `cause of action estoppel' may arise. In Thoday (supra) Lord Diplock

held :

"...cause of action estoppel" is that which prevents a party to an action

from asserting or denying, as against the other party, the existence of a

particular cause of action, the non-existence or existence of which has

been determined by a court of competent jurisdiction in previous litigation

between the same parties. If the cause of action was determined to exist,

i.e., judgment was given on it, it is said to be merged in the

judgment....If it was determined not to exist, the unsuccessful plaintiff

can no longer assert that it does; he is estopped per rem judicatam."

The said dicta was followed in Barber v. Staffordshire Country Council,

[1996] 2 All ER 748. A cause of action estoppel arises where in two

different proceedings identical issues are raised, in which event, the

latter proceedings between the same parties shall be dealt with similarly

as was done in the previous proceedings. In such an event the bar is

absolute in relation to all points decided save and except allegation of

fraud and collusion. [See C. (a minor) v. Hackney London Borough Council,

[1996] 1 All ER 973].

[See `The Doctrine of Res judicata', 2nd Edn. by Spencer Bower and Turner

p. 149]

In this view of the matter, the High Court, in our opinion, had no

jurisdiction to go into the aforementioned question.

Furthermore, a writ of mandamus is required to be obeyed unless a judgment

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is overruled or a legislation by way of validating statute is brought into

force.

In Madan Mohan Pathak and Anr v. Union of India and Ors., [1978] 2 SCC 50 :

AIR (1978) SC 803], the Constitution Bench observed:

"Here, the judgment given by the Calcutta High Court, which is relied upon

by the petitioners, is not a mere declaratory judgment holding an impost or

tax to be invalid, so that a validation statute can remove the defect

pointed out by the judgment amending the law with retrospective effect and

validate such impost or tax. But it is a judgment giving effect to the

right of the petitioners to annual cash bonus under the Settlement by

issuing a writ of mandamus directing the Life Insurance Corporation to pay

the amount of such bonus. If by reason of retrospective alteration of the

factual or legal situation, the judgment is rendered erroneous, the remedy

may be by way of appeal or review, but so long as the judgment stands, it

cannot be disregarded or ignored and it must be obeyed by the Life

Insurance Corporation. We are, therefore, of the view that, in any event,

irrespective of whether the impugned Act is constitutionally valid or not,

the Life Insurance Corporation is bound to obey the writ of mandamus issued

by the Calcutta High Court and to pay annual cash bonus for the year April

1, 1975 to March 31, 1976 to Class III and Class IV employees."

In any event, the directions issued by the court stood complied with.

Having regard to Section 18 of the Act or otherwise the wheel cannot be

turned back.

We must also note that the question raised by the learned Judges of the

High Court was not raised by the Respondents although having regard to the

decision of this Court in Dharam Das (supra) it was available.

The High Court, in our opinion, although has a wide power in terms of

Section 107 of the Code of Civil Procedure but it could not have gone

outside the pleadings and make out a new case.

In Siddu Venkappa Devadiga v. Smt. Rangu S. Devadiga and Ors., [1977] 3 SCC

532, it was held:

"8...As has been stated, the defendant traversed that claim in his written

statement and pleaded that the business always belonged to him as owner.

There was thus no plea that the business was "benami" for Shivanna. We also

find that the parties did not join issue on the question that the business

was "benami". On the other hand, the point at issue was whether Shivanna

was the owner of the business and the tenancy rights of the premises where

it was being carried on. It is well-settled, having been laid down by this

Court in Trojan and Co. Ltd. v. RM. N.N. Nagappa Chettiar and Raruha Singh

v. Achal Singh that the decision of a case cannot be based on grounds

outside the plea of the parties, and that it is the case pleaded which has

to be found. The High Court therefore went wrong in ignoring this basic

principle of law, and in making out an entirely new case which was not

pleaded and was not the subject-matter of the trial."

For the reasons stated above, the appeals are accepted, the impugned

judgments under appeals are set aside and that of the Reference Court are

affirmed. No costs.