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Supreme Court by 2:1 majority holds Pune Municipal Corporation decision as per incuriam; Holds that there is no lapse of acquisition due to non deposit of amount

The Supreme Court in Indore Development Authority v. Shailendra (Dead) Through LRS and Others, by 2:1 majority held that the decision in Pune Municipal Corporation & Anr. v. Harakchand Misirimal Solanki as per incuriam. The main issue that arose for consideration of the Court was the interpretation section 24 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 and section 31 of the Land Acquisition Act, 1894.

The questions that arose for consideration and answered by the bench consisting of Justices Arun Mishra, Adarsh Kumar Goel and Mohan M. Shantanagoudar were:

  1. What is the meaning of the expression ‘paid’/ ‘tender’ in Section 24 of the Act of 2013 and section 31 of the Act of 1894? Whether non-deposit of compensation in court under section 31(2) of the Act of 1894 results into a lapse of acquisition under section 24(2) of the Act of 2013. What are the consequences of non-deposit in Court especially when compensation has been tendered and refused under section 31(1) of the Act of 1894 and section 24(2) of the Act of 2013? Whether such persons after refusal can take advantage of their wrong/conduct?
  2. Mode of taking physical possession as contemplated under section 24(2) of the Act of 1894.
  • Whether section 24 of Act of 2013 revives barred and stale claims?
  1. Whether the conscious omission referred to in paragraph 11 of the judgment in Shree Balaji Nagar Residential Association v. State of Tamil Nadu [(2015) 3 SCC 353] makes any substantial difference to the legal position with regard to the exclusion or inclusion of the period covered by an interim order of the Court for the purpose of determination of the applicability of Section 24(2) of the 2013 Act?
  2. Whether the principle of actus curiae neminem gravabit, namely act of the Court should not prejudice any parties would be applicable in the present case to exclude the period covered by an interim order for the purpose of determining the question with regard to taking of possession as contemplated in Section 24(2) of the 2013 Act?

As regards question no. 1, the Court held that the ‘paid’ in section 24 of the Act of 2013 has the same meaning as ‘tender of payment’ in section 31(1) of the Act of 1894. Regarding the lapse of acquisition on non deposit of compensation, the Court stated that,

“In section 24(2) of the Act of 2013 in the expression ‘paid,’ it is not necessary that the amount should be deposited in court as provided in section 31(2) of the Act of 1894. Non-deposit of compensation in court under section 31(2) of the Act of 1894 does not result in a lapse of acquisition under section 24(2) of the Act of 2013. Due to the failure of deposit in court, the only consequence at the most in appropriate cases may be of a higher rate of interest on compensation as envisaged under section 34 of the Act of 1894 and not lapse of acquisition.”

As regards to the question of refusal of acceptance of compensation once the amount of compensation has been unconditionally tendered, it was held that the same amounted to payment and hence the obligation under Section 31(1) of the Act of 1894 and 24(2) of the Act of 2013 stood discharged. The Court held that thereafter, it was not open to the claimants to take advantage of their own wrongs by refusing acceptance of compensation and seek protection under the provisions of section 24(2)      of the Act of 2013.

As regards question no.2, the Court cited the decision in Banda Development Authority, Banda v. Moti Lal Agarwal & Ors. (2011) 5 SCC 394 in approval and held that preparing a Panchnama is sufficient to constitute taking of possession.

“88. … In Banda Development Authority (supra), this Court has held that if land was vacant, going to the spot and preparing a panchnama by a state authority would ordinarily be treated as sufficient to constitute the taking of possession. If crop is standing, notice was required to be given to the occupier of building or structure and thereafter taking possession in presence of independent witnesses and in spite of refusal by the owner did not mean that possession of the has not been taken. If acquisition is of a large tract of land, it would not be possible to take physical possession of each and every parcel of such land. Taking ‘symbolic’ possession, by preparing an appropriate document, in presence of independent witnesses, was sufficient. Where urgency clause was invoked and substantial portion of land was acquired or utilized in furtherance of the particular public purpose, taking of possession was presumed. Utilization of a major portion of acquired land for public purpose was itself sufficient to prove taking over possession.”

          The Court held that the view taken in Velaxan Kumar v. Union of India & Ors. (2015) 4 SCC 325 wherein it was held that actual physical possession is required to be taken, was contrary to the settled law laid down in Sita Ram Bhandar Society, New Delhi v. Lieutenant Governor, Government of NCT, Delhi & Ors. (2009) 10 SCC 501 and M. Venkatesh & Ors. v. Commissioner, Bangalore Development Authority etc. (2015) 17 SCC 1 among others, and hence overruled the decision in Velaxan Kumar.

As regards question no.3, the Court held that the provisions of Section 24 of the Act of 2013 do not revive barred or staled claims and that such claims cannot be entertained. The Court held that Section 24 is not intended to come to the aid of those who first deliberately refuse to accept the compensation, and then indulge in ill-advised litigation, and often ill-motivated dilatory tactics, for decades together. The Court observed,

“98. In our considered opinion section 24 cannot be used to revive the dead or stale claims and the matters, which have been contested up to this Court or even in the High Court having lost the cases or where reference has been sought for enhancement of the compensation. Compensation obtained and still it is urged that physical possession has not been taken from them, such claims cannot be entertained under the guise of section 24(2). We have come across the cases in which findings have been recorded that by which of drawing a Panchnama, possession has been taken, now again under Section 24(2) it is asserted again that physical possession is still with them. Such claims cannot be entertained in view of the previous decisions in which such plea ought to have been raised and such decisions would operate as res judicata or constructive res judicata. As either the plea raised is negatived or such plea ought to have been raised or was not raised in the previous round of litigation. Section 24 of the Act of 2013 does not supersede or annul the court’s decision and the provisions cannot be misused to reassert such claims once over again. Once Panchnama has been drawn and by way of drawing the Panchnama physical possession has been taken, the case cannot be reopened under the guise of section 24 of Act of 2013.”

As regards Question no. 4, the Court concluded that the provisions of section 24(2) do not intend to cover the period spent during litigation and when the authorities have been disabled to act under section 24(2) due to the final or interim order of a court or otherwise, such period has to be excluded from the period of five years as provided in section 24(2) of the Act of 2013. There is no conscious omission in section 24(2) for the exclusion of a period of the interim order. There was no necessity to insert such a provision. The omission does not make any substantial difference as to legal position.

As regards question no. 5, as to the exclusion of the period covered by an interim order for the purpose of determining the question with regard to taking of possession under Section 24(2) of the act of 2013, the court observed,

“137. In case of possession could not be taken, or compensation could not be paid or deposited, due to cover of courts’ order or conduct of landowner, such cases provision of lapse cannot be invoked. Section 24(2), a policy of the law is not to benefit a litigant or confer undeserving benefit by involving in the lis and to reap fruits on the basis of possession on illegal basis without any right and often lis is filed in land acquisition cases one after the other and intendment of law is not to treat law-abiding incumbents differently. Operation of law and beneficial provisions of law in the Act of 2013 are not meant to benefit litigants and to permit them to reap the fruits of unworthy or frivolous litigation; and, if there is any merit in such a lis, the challenge therein must stand or fall on its own footing, irrespective of, and apart from, the coming into force of the 2013 Act. Litigation cannot be permitted to become lucrative industry for the unworthy litigant; it cannot be permitted to be device providing for fruits in respect of a meritless lis.”

It thereafter held thatthe principle of actus curiae neminem gravabit is applicable including the other common law principles for determining the questions under section 24 of the Act of 2013. The period covered by the final/ interim order by which the authorities have been deprived of taking possession has to be excluded. Section 24(2) has no application where Court has quashed acquisition.

The Court thereafter proceeded to evaluate the correctness of the decision in Pune Municipal Corporation and did not consider it necessary to refer the same to a larger bench and held the same as per incuriam for the following reasons,

  1. The High Court has quashed land acquisition, in Pune Municipal Corporation case, as such provisions of section 24(2) of the Act of 2013 could not be said to be applicable. It was not surviving acquisition then compliance of section 24(2) by taking possession or by payment of compensation for five years or more did not arise as acquisition had been quashed by the High Court in 2008.
  2. It was not held in Pune Municipal Corporation that High Court has illegally set aside the acquisition. In case, High Court had set aside the acquisition in an illegal manner then also maxim ‘actus curiae neminum gravabit’ would have come to the rescue to save acquisition from being lapsed and a period spent in appeal in this Court was to be excluded.
  3. The provisions of Section 24(2) could not be said to be applicable to the case once acquisition stood quashed in 2008 by the High Court. Thus, there was no occasion for this court to decide the case on aforesaid aspect envisaged under section 24(2) of the Act of 2013.
  4. That statutory rules framed under section 55 of Act of 1894 and orders having statutory force issued under, constitutional provisions or otherwise by various State Governments were not placed for consideration before this court in Pune Municipal Corporation case
  5. Provisions of section 34 prevailing practice of deposit, and binding decisions thereunder section 34 of the Act of 1894 were not placed for consideration of this court while deciding the case.
  6. The proviso to section 24(2) was not placed for consideration which uses different expression ‘deposited’ than ‘paid’ in main section 24(2) which carry a different meaning.
  7. What is the meaning of expression ‘paid’ as per various binding decisions of this court when the obligation to pay is complete as held in Straw Board Manufacturing Co. Ltd., Saharanpur v. Gobind, Management of Delhi Transport Undertaking v. The Industrial Tribunal, Delhi & Anr., Indian Oxygen Ltd. v. Narayan Bhoumik and the Benares State Bank Ltd. v. The Commissioner of Income Tax, Lucknow, and other decisions were not placed for consideration.
  8. The binding decisions of the court as to the consequence of non-deposit in Hissar Improvement v. Smt. Rukmani Devi & Anr., Kishan Das & Ors. v. State of U.P. & Ors. and Seshan & Ors. v. Special Tehsildar & Land Acquisition Officer, SPICOT, Pudukkottai were not placed for consideration while deciding the case.
  9. The maxim “nullus commodum capere potest de injuria sua propria” i.e. no man can take advantage of his own wrong of filing litigation and effect of refusal to receive compensation was not placed for consideration while deciding the aforesaid case.
  10. There is no lapse of acquisition due to the non deposit of amount under the provisions of Act of 1894 or Act of 2013. In this regard, the provision of section 77 and 80 relating to payment and deposit under Act of 2013 which corresponds to section 31 and 34 were not placed for consideration of this court while rendering the aforesaid decision.
  11. The past practice for more than a century, of deposit in treasury, as per rules/ orders and decisions were not placed for consideration. It was not open to invalidate such deposits made in treasury without consideration of the provisions, prevailing practice, and decisions under the Act of 1894.

Read the judgment below:

13346_2015_Judgement_08-Feb-2018-watermark

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