Lucknow Development Authority vs. Mehdi Hasan: Supreme Court Overrules Land Acquisition Lapse

The Supreme Court of India, in its judgment dated December 12, 2022, in the case of Lucknow Development Authority vs. Mehdi Hasan (Deceased) Through Legal Representatives & Others, overturned the Allahabad High Court’s ruling that had declared the land acquisition proceedings lapsed under Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation, and Resettlement Act, 2013.

The Supreme Court ruled that as the possession of the land in question had already been taken by the Lucknow Development Authority in 2003, the acquisition could not be deemed to have lapsed. The judgment reaffirmed the interpretation provided by the Constitution Bench in Indore Development Authority vs. Manoharlal regarding the applicability of Section 24(2) of the 2013 Act.

Background of the Case

The dispute arose over the acquisition of land in Village Malesemau, Tehsil & District Lucknow, involving Plot No. 219, measuring 1 bigha, 10 biswa, and 10 biswansi. The land was acquired under the Land Acquisition Act, 1894. The Allahabad High Court’s Lucknow Bench had ruled in favor of the landowners and declared the acquisition as lapsed on the ground that compensation had not been paid.

Challenging this ruling, the Lucknow Development Authority filed an appeal before the Supreme Court, arguing that possession of the land had already been taken in 2003, and compensation had been deposited in the court under Section 30(2) of the 1894 Act.

Arguments Presented

Petitioners’ (Lucknow Development Authority) Arguments

The Lucknow Development Authority, represented by its counsel, argued:

The High Court had erroneously declared the acquisition lapsed solely based on the non-payment of compensation.
As per the Supreme Court’s ruling in Indore Development Authority, the lapse of acquisition proceedings requires both conditions—failure to take possession and non-payment of compensation—to be met.
Possession of the land had been taken on February 13, 2003, and handed over to the Lucknow Development Authority on the same day.
Compensation had been deposited in the court, which satisfied the legal requirement under Section 24(2) of the 2013 Act.

Respondents’ (Landowners) Arguments

The respondents, represented by their counsel, countered with the following points:

The landowners had not received compensation, and mere deposit in court does not amount to actual payment.
The Allahabad High Court had correctly ruled that unless compensation is paid to landowners, the acquisition should be considered lapsed.
The possession of land was disputed, and the government had not provided clear evidence that it had actually taken possession.

Supreme Court’s Observations

The Supreme Court reviewed the legal and factual aspects of the case and observed:

“The Allahabad High Court has allowed the writ petition and declared the acquisition with respect to the land in question deemed to have lapsed under Section 24(2) of the Act, 2013 solely on the ground that the compensation was not tendered/paid to the original landowners.”
“However, the fact remains that the possession of the land in question was duly taken on 13.02.2003 and was delivered to the Lucknow Development Authority on 13.02.2003 itself.”
“As per the law laid down by this Court in the case of Indore Development Authority, to attract Section 24(2) of the Act, 2013, twin conditions of not taking possession and not tendering/payment of compensation are required to be satisfied.”
“As per the law laid down by this Court, if one of the conditions is not satisfied, the acquisition proceedings are not deemed to have lapsed under Section 24(2) of the Act, 2013.”

Legal Interpretation of Section 24(2) of the 2013 Act

The Supreme Court, in Indore Development Authority, provided clarity on how Section 24(2) should be interpreted:

The lapse of land acquisition proceedings requires both non-payment of compensation and failure to take possession.
Depositing compensation in court is sufficient compliance with the legal requirement of payment.
Landowners who refuse to accept compensation or seek higher compensation through legal proceedings cannot claim that acquisition has lapsed.
Once possession is taken, land vests in the state, and acquisition cannot be reversed under Section 24(2).

Judgment and Ruling

The Supreme Court ruled in favor of the Lucknow Development Authority and held:

The Allahabad High Court’s judgment was quashed and set aside.
The land acquisition proceedings were upheld as valid and not deemed to have lapsed.
The ruling in Indore Development Authority was reaffirmed as the authoritative interpretation of Section 24(2) of the 2013 Act.

Implications of the Judgment

This ruling has wide-ranging implications for land acquisition cases in India:

Government authorities can now rely on the clarity provided by the Supreme Court regarding Section 24(2) of the 2013 Act.
Landowners cannot claim lapse of acquisition proceedings solely based on non-payment of compensation if it has been deposited in court.
Public infrastructure projects that were stalled due to legal challenges may now proceed without unnecessary delays.

Conclusion

The Supreme Court’s decision in Lucknow Development Authority vs. Mehdi Hasan (Deceased) Through Legal Representatives & Others is a landmark ruling that reinforces the legal position on land acquisition proceedings. By upholding the acquisition and quashing the Allahabad High Court’s ruling, the Court has ensured that landowners do not unfairly benefit from procedural delays and that public projects can continue without legal hurdles. This judgment sets a crucial precedent for future land acquisition cases and provides clarity on the application of Section 24(2) of the 2013 Act.

Petitioner Name: Lucknow Development Authority.
Respondent Name: Mehdi Hasan (Deceased) Through Legal Representatives & Others.
Judgment By: Justice M.R. Shah, Justice M.M. Sundresh.
Place Of Incident: Lucknow.
Judgment Date: 12-12-2022.

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