Government of NCT of Delhi vs. Subhash Jain: Supreme Court Overrules Land Acquisition Lapse

The Supreme Court of India, in its judgment dated December 2, 2022, in the case of Government of NCT of Delhi vs. Subhash Jain & Others, overturned the Delhi High Court’s ruling that had declared 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 the High Court erred in applying the principles of Pune Municipal Corporation vs. Harakchand Misirimal Solanki, which had already been overruled by the Constitution Bench in Indore Development Authority vs. Manoharlal. The Court reaffirmed that for an acquisition to lapse under Section 24(2) of the 2013 Act, both possession must not have been taken, and compensation must not have been paid. If either condition is met, the acquisition remains valid.

Background of the Case

The dispute arose from land acquisition proceedings initiated under the Land Acquisition Act, 1894. The Government of NCT of Delhi had acquired land for public purposes, but the landowners challenged the acquisition in various legal proceedings.

The Delhi High Court ruled in favor of the landowners, declaring that the acquisition had lapsed under Section 24(2) of the 2013 Act, primarily due to non-payment of compensation. The Government of NCT of Delhi challenged this decision before the Supreme Court.

Arguments Presented

Petitioners’ (Government of NCT of Delhi) Arguments

The Government of NCT of Delhi, represented by its counsel, argued:

The Delhi High Court should not have relied on Pune Municipal Corporation, which was later overruled in Indore Development Authority.
Possession of the land was taken, and once possession is taken, the land vests with the state, making the acquisition final.
Non-payment of compensation does not result in an automatic lapse of acquisition, as clarified by the Supreme Court in Indore Development Authority.

Respondents’ (Subhash Jain) Arguments

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

Compensation had not been paid to the landowners, and the acquisition should lapse under Section 24(2) of the 2013 Act.
The High Court correctly ruled in favor of the landowners based on the need for fair compensation.
The government’s failure to compensate the landowners within the stipulated time frame invalidated the acquisition.

Supreme Court’s Observations

The Supreme Court reviewed the case and observed:

“Possession of the land in question was taken, and once possession is taken, the land vests in the state. The acquisition, therefore, cannot lapse under Section 24(2) of the 2013 Act.”
“The High Court erroneously relied on Pune Municipal Corporation, which has been explicitly overruled by the Constitution Bench in Indore Development Authority.”
“For acquisition to lapse under Section 24(2) of the 2013 Act, both possession must not have been taken, and compensation must not have been paid. If either condition is met, the acquisition remains valid.”

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 Government of NCT of Delhi and held:

The Delhi 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:

The Supreme Court reaffirmed that mere non-payment of compensation does not nullify land acquisition.
Government authorities can rely on the clarity provided by the Court regarding Section 24(2) of the 2013 Act.
Public infrastructure projects that were stalled due to legal challenges may now proceed without unnecessary delays.

Conclusion

The Supreme Court’s decision in Government of NCT of Delhi vs. Subhash Jain & Others reinforces the legal position that once possession of land has been taken, the acquisition cannot lapse. By upholding the acquisition and quashing the Delhi 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: Government of NCT of Delhi.
Respondent Name: Subhash Jain & Others.
Judgment By: Justice M.R. Shah, Justice C.T. Ravikumar.
Place Of Incident: Delhi.
Judgment Date: 02-12-2022.

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