Land Acquisition Dispute: Supreme Court Upholds Compensation Under 2013 Act

The Supreme Court recently ruled in the case of NOIDA Industrial Development Authority v. Ravindra Kumar & Ors., addressing a long-standing land acquisition dispute. The case revolved around the validity of the invocation of urgency clauses under the Land Acquisition Act, 1894, the rights of landowners, and the applicability of compensation provisions under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. This decision significantly impacts landowners whose lands were acquired under the old act without fair compensation.

Background of the Case

The dispute arose when the State Government of Uttar Pradesh issued a notification on November 7, 2007, under Section 4 of the 1894 Act, notifying its intent to acquire 108.233 hectares of land in Village Begumpur, Pargana Dankaur, Tehsil Sadar, District Gautam Budh Nagar. The acquisition aimed at industrial development through NOIDA Industrial Development Authority. The urgency clause under Section 17 was invoked, which allowed the state to bypass the mandatory hearing process under Section 5A.

Possession of a portion of the land was taken on June 7, 2008, while the remaining land was acquired on June 15, 2013. Two separate compensation awards were issued:

On January 12, 2011, compensation under the Karar Niyamawali (Agreement Rules) was fixed at different rates:

Rs. 870 per square meter for regular tenure holders.
Rs. 1,000 per square meter for ancestral tenure holders.
For those who refused the agreement, Rs. 135.28 per square meter with solatium and interest.

On December 31, 2013, a second award confirmed similar rates with slight modifications.

Petitioners’ Arguments

Landowners, dissatisfied with the compensation, filed writ petitions from 2011 to 2014 before the Allahabad High Court, challenging:

The invocation of urgency clauses, which bypassed their right to be heard.
Discriminatory compensation where some received higher payments under agreements.
The need for compensation under the 2013 Act due to procedural irregularities.

State’s Defense

The state and NOIDA Industrial Development Authority argued that:

Most landowners accepted compensation, and only a few petitioned belatedly.
Significant industrial and infrastructure development had taken place on the land.
The 2013 Act was inapplicable as the acquisition occurred under the 1894 Act.

High Court’s Decision

The Allahabad High Court ruled that the invocation of urgency clauses was illegal but refused to quash the acquisition, balancing public interest with individual rights. The court directed that those who had not accepted compensation under agreements should receive revised compensation under the 2013 Act, determined as per the market value at the time of judgment.

Supreme Court’s Judgment

Upon appeal, the Supreme Court upheld the High Court’s decision, ruling that:

The urgency clause was wrongly invoked, violating procedural fairness.
Acquisition should not be quashed as significant development had already occurred.
Compensation under the 2013 Act should be granted to those who refused the earlier compensation.

Key Judicial Observations

“The invocation of urgency provisions under Section 17 was illegal, and affected landowners must receive compensation at market rates under the 2013 Act.”

The Supreme Court reaffirmed the principle that while land acquisition cannot be undone in cases where significant development has taken place, affected parties must be compensated fairly.

Impact of the Judgment

This decision sets a precedent in land acquisition cases, reinforcing the right to fair compensation and due process. It clarifies that improper invocation of urgency clauses cannot deprive landowners of fair treatment. The ruling also ensures that compensation is aligned with current market values, preventing arbitrary state action.

For affected landowners, this verdict provides relief, ensuring they receive appropriate compensation. For future land acquisitions, the judgment emphasizes adherence to procedural requirements, preventing misuse of urgency provisions.

Petitioner Name: NOIDA Industrial Development Authority.
Respondent Name: Ravindra Kumar & Ors..
Judgment By: Justice Ajay Rastogi, Justice Abhay S. Oka.
Place Of Incident: Gautam Budh Nagar, Uttar Pradesh.
Judgment Date: 09-05-2022.

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