Land Acquisition Disputes: Supreme Court Overrules Lapsed Acquisition Under Section 24(2) of 2013 Act

The Supreme Court of India recently ruled on a significant land acquisition dispute in the case of The Secretary, The Department of Land and Building & Ors. v. Anjeet Singh (Dead) through LRs & Anr.. The case dealt with the application of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation, and Resettlement Act, 2013 (hereinafter referred to as the ‘2013 Act’), particularly concerning whether land acquisition proceedings initiated under the Land Acquisition Act, 1894, had lapsed due to non-payment of compensation.

Background of the Case

The dispute arose when the Delhi High Court ruled in favor of the respondents (landowners), declaring that the acquisition of land in Khasra No. 156, Village Lado Sarai, New Delhi, had lapsed under Section 24(2) of the 2013 Act. The ruling was primarily based on an earlier Supreme Court decision in Pune Municipal Corporation & Anr. v. Harakchand Misirimal Solanki & Ors., which held that land acquisition lapses if compensation was neither paid nor deposited.

The Delhi Development Authority (DDA) and the Land Acquisition Collector challenged this decision before the Supreme Court, arguing that the High Court had failed to consider the subsequent Constitution Bench ruling in Indore Development Authority v. Manoharlal & Ors., which overruled the Pune Municipal Corporation case.

Petitioner’s Arguments

The appellants (Department of Land and Building & Ors.) made the following key arguments:

The land acquisition proceedings commenced in 1986, and an award under the Land Acquisition Act, 1894, was declared on 14.09.1986.
Possession of the land was taken on 22.09.1986, which was an essential factor in determining whether acquisition had lapsed.
The High Court relied on the overruled judgment in Pune Municipal Corporation, making its decision legally unsustainable.
The Constitution Bench in Indore Development Authority clarified that for acquisition to lapse under Section 24(2), both possession must not have been taken and compensation must not have been paid.
Even if compensation was not paid, it did not invalidate the acquisition if possession was lawfully taken.

Respondent’s Arguments

The respondents (landowners) contended:

The compensation for the land had not been paid to them, making the acquisition invalid under Section 24(2) of the 2013 Act.
The ruling in Pune Municipal Corporation supported their position that non-payment of compensation results in the automatic lapse of acquisition.
Since the land was not put to public use, the acquisition should be deemed to have lapsed.

Supreme Court’s Observations

The Supreme Court analyzed the legal precedents and legislative intent behind Section 24(2) of the 2013 Act. It reiterated the principles laid down in the Constitution Bench ruling in Indore Development Authority:

For acquisition to lapse under Section 24(2), both conditions (non-possession and non-payment of compensation) must be satisfied.
If either possession has been taken or compensation has been paid, the acquisition remains valid.
Non-deposit of compensation in court does not automatically mean the acquisition lapses.
If compensation was withheld due to an ownership dispute among landowners, the lapse provision does not apply.

Supreme Court’s Decision

The Supreme Court ruled in favor of the Department of Land and Building & Ors. and held that:

The High Court’s reliance on Pune Municipal Corporation was incorrect as that judgment had been overruled by Indore Development Authority.
Possession of the land had already been taken, making the acquisition valid.
The respondents’ claim of lapse was legally untenable as per the Supreme Court’s settled law.

Accordingly, the Supreme Court set aside the High Court’s judgment and dismissed the respondent’s petition.

Key Takeaways from the Judgment

This ruling provides important clarity on land acquisition law:

Finality of Possession: Once possession is taken for public purposes, the land vests in the State and cannot be reclaimed due to procedural issues in compensation payment.
Clarification on Compensation: The Court distinguished between non-payment and refusal to accept compensation, clarifying that non-deposit in court does not invalidate the acquisition.
Impact on Pending Cases: The judgment sets a clear precedent, preventing landowners from exploiting legal loopholes to challenge acquisitions that have been lawfully executed.

Conclusion

The Supreme Court’s ruling in The Secretary, The Department of Land and Building & Ors. v. Anjeet Singh & Ors. reinforces the principle that valid land acquisitions cannot be undone solely due to non-payment of compensation. By reaffirming the interpretation set forth in Indore Development Authority, the Court has ensured that public development projects are not disrupted by misinterpretation of land acquisition laws. This judgment is a landmark precedent in protecting government acquisitions while ensuring fair compensation for landowners.

Petitioner Name: The Secretary, The Department of Land and Building & Ors..
Respondent Name: Anjeet Singh (Dead) through LRs & Anr..
Judgment By: Justice M.R. Shah, Justice M.M. Sundresh.
Place Of Incident: New Delhi, India.
Judgment Date: 24-11-2022.

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