Land Acquisition Act 2013: SC refers question of Proviso to Section 24 to a Larger Bench

A Division Bench of the Supreme Court has referred to a larger Bench a case dealing with the proviso to Section 24 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (Land Acquisition Act 2013) .

. The question before the Court was whether the proviso to Section 24 applies to Section 24(1)(b) or Section 24(2).

. A 2018 judgment of the Supreme Court in Delhi Metro Rail Corporation v. Tarun Pal Singh had held that proviso to Section 24 governs Section 24(2) and not Section 24(1)(b).

. A Bench of Justices Rohinton Nariman and Vineet Saran held that the above judgment would require reconsideration.

. Since the case of Indore Development Authority v. Shailendra , which deals with different aspects of Section 24, had already been referred to a Constitution Bench, the Court said that the judgment in Tarun Pal Singh should be considered by the same Bench.

. It, therefore, requested the Chief Justice of India to refer DMRC v. Tarun Pal Singh to the larger bench which is hearing Indore Development Authority .

. Some background

. In 2015, the Delhi High Court by its judgment in Tarun Pal Singh v. Lieutenant Governor, Government of NCT of Delhi had held that the proviso would govern Section 24(1)(b), and not Section 24(2). This judgment was followed in a number of other judgments of the same High Court.

. In 2018, a Division Bench of the Supreme Court in Delhi Metro Rail Corporation v. Tarun Pal Singh took the view that the proviso to Section 24 governs Section 24(2) and not Section 24(1)(b).

. Arguments

. The instant case is an appeal filed against a Delhi High Court judgment. It was argued by the Delhi Development Authority through Senior Counsel Amarendra Sharan that Delhi Metro Rail Corporation v. Tarun Pal Singh, being a very recent judgment of the Supreme Court, ought not to be disturbed as it has correctly appreciated and laid down the law in great detail.

. However, Senior Advocate Dhruv Mehta , appearing on behalf of the respondents, contended that the judgment in Delhi Metro Rail Corporation v. Tarun Pal Singh requires a re-look . According to him, if the proviso to Section 24 were to govern Section 24(2) and not Section 24(1)(b), a valuable right of lapsing would be taken away, and various inconsistencies would follow.

. Section 24

. Section 24 of the Act deals with situations where the land acquisition process initiated under the previous Act is deemed to have been lapsed. Under certain circumstances, the compensation is payable not under the provisions of the repealed Act, but under the 2013 Act.

. Section 24(1)(b) states that when an award has already been made under Section 11 of the repealed Act, the proceedings shall continue as though the Act was never repealed.

. Section 24(2) , however, states that when an award was made under Section 11 of the repealed Act five or more years prior to the commencement of the 2013 Act, and if the physical possession has not been taken or the compensation has not yet been paid, then the proceedings shall deem to have lapsed. Fresh proceedings, in that case, can be initiated under the provisions of the 2013 Act.

. The proviso to the Section is worded as follows:

. “Provided that where an award has been made and compensation in respect of a majority of land holdings has not been deposited in the account of the beneficiaries, then, all beneficiaries specified in the notification for acquisition under Section 4 of the said Land Acquisition Act, shall be entitled to compensation in accordance with the provisions of this Act.”

. Judgment

. The Court noted that the subject matter dealt with by Sections 24(1)(b) and 24(2) are different and highlighted that Section 24(1) deals with compensation whereas Section 24(2) deals with lapsing of the acquisition itself.

. The Bench stated that if the proviso is read with Section 24 (1)(b), there is no repugnancy or inconsistency as it points towards the application of the more beneficial provisions of the 2013 Act in cases where compensation has not yet been deposited.

. However, if the proviso is read with Section 24(2), many anomalies arise. The Court proceeded to explain the same by citing the judgment in Delhi Metro Rail Corporation v. Tarun Pal Singh.

. As per this judgment, for sub-section (2) of Section 24 to apply: (i) the award under Section 11 of the 1894 Act should have been made five years or more prior to the commencement of the Act; and (ii) physical possession of the land should not have been taken or compensation should not have been paid.

. In a case where the award has been made six years before the Act came into force, and physical possession of the land has not been taken, the acquisition is deemed to have lapsed. If the proviso is to apply to Section 24(2), then irrespective of whether physical possession has not been taken, there will be no lapse, as has been held in Delhi Metro Rail Corporation.

. This, the Court held, would fly in the face of several judgments of the Supreme Court wherein it has been held that a proviso cannot be used to nullify or set at naught the substantive provision contained in the main enactment.

. The Court also observed that if the proviso is read with Section 24(2), then “arbitrary results” would ensue and the proviso would be liable to be struck down for violation of Article 14 of the Constitution.

. Elaborating on this, the Court said,

. “Take the case of a Section 4 notification applying only to a single piece of land with a single owner. If the conditions of sub-section (2) of Section 24 are fulfilled, the acquisition would lapse. However, in the case of a neighbouring land, which happens to be land belonging to the same owner, which is one among twenty pieces of land that have been acquired under a single Section 4 notification, if compensation in respect of a majority of land holdings has not been deposited, such acquisition will not lapse, but only higher compensation under the 2013 Act would be paid.

. Obviously, a particular land holder’s acquisition lapsing cannot be dependent upon a contingency as to whether his land alone is acquired or is acquired in conjunction with other persons’ lands.”

. The aspect of the legislation being a beneficial one was also touched upon by the Court, with the judgment underscoring the object of the Act. The process of land acquisition must be carried out in a humane manner and the Act must be construed in a manner which furthers this purpose, the Bench held.

. “We must not forget that we are dealing with a beneficial legislation. The Preamble which has been referred to casts light on the object sought to be subserved by the 2013 Act in general, as well as by Section 24. We have already seen that land acquisition is to take place in a humane fashion, with the least disturbance to the owners of the land, as also, to provide just and fair compensation to affected persons. Viewed in the light of the Preamble, this legislation, being a beneficial legislation, must be construed in a way which furthers its purpose.”

. The reading of the proviso with Section 24(1)(b) achieves the beneficial object of the Act and in a case where two views are possible, the Court said that the beneficial view should be the preferred one.

. “On the assumption, therefore, that two views are possible, the view which accords with the beneficial object sought to be achieved by the legislation, is obviously the preferred view.”

. Read about the Consitution Bench hearing the Indore Development Authority case March 6, 2018: Constitution Bench to decide correctness of Pune Municipal Corporation, Indore Development Authority March 21, 2018: Exclusive: Missing opinion of Mohan Shantanagoudar J. in Indore Development Authority creates another controversy January 30, 2019: Section 24 of Land Acquisition Act : Centre seeks early hearing in Supreme Court . Reference to a Larger Bench . In light of the above, the Court concluded that the judgment in Delhi Metro Rail Corporation v. Tarun Pal Singh would require reconsideration .

. Hence, it requested the Chief Justice of India to refer this case to the Constitution Bench hearing Indore Development Authority.

. “For all these reasons, it is better if this judgment were also to be referred to the same Bench which is hearing Indore Development Authority (supra) afresh, as that case also refers to different aspects of the same provision, namely, Section 24 of the 2013 Act. For all these reasons, we request the Chief Justice of India to refer Delhi Metro Rail Corporation v. Tarun Pal Singh, (2018) 14 SCC 161 to the aforesaid larger Bench for reconsideration thereof.”

. Read the Judgment below:

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Land Acquisition Act 2013: SC refers question of Proviso to Section 24 to a Larger Bench

Shruti Mahajan

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