Court’s Decision
The Calcutta High Court allowed a series of connected appeals and set aside the order of the learned Single Judge which had held that the land acquisition proceedings under the Land Acquisition Act, 1894 stood lapsed. The Court held that since possession had been taken and compensation tendered—even if not accepted by the landowners—the acquisition did not lapse. It further ruled that the application of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 was unwarranted. The principle of res judicata also barred the landowners from re-agitating issues already decided.
Facts
The case stemmed from the acquisition of land for the establishment of a Telecon Industrial Unit. Multiple writ petitions were filed challenging the acquisition proceedings initiated under the Land Acquisition Act, 1894. Initially, the landowners challenged the notices issued under Sections 4 and 6 of the 1894 Act, but that challenge failed. Later, the landowners again approached the Court through fresh writ petitions seeking invocation of Section 18 of the 1894 Act and asserting that no possession was taken and compensation was not paid. The learned Single Judge accepted these contentions and held that the acquisition stood lapsed, thereby requiring proceedings to be initiated under the 2013 Act.
This led to six connected appeals—three by the beneficiary of the acquisition and three by the State of West Bengal—challenging the correctness of the Single Judge’s order.
Issues
- Whether the acquisition proceedings under the Land Acquisition Act, 1894 stood lapsed for want of possession and payment of compensation.
- Whether the invocation of the 2013 Act by the learned Single Judge was justified.
- Whether the principle of res judicata barred re-litigation of previously decided issues.
Petitioner’s Arguments
The writ petitioners argued that no possession of their land was ever taken and that compensation was never paid. They relied on the Supreme Court’s ruling in Indore Development Authority v. Manoharlal & Ors. to contend that acquisition lapses under Section 24(2) of the 2013 Act when both possession is not taken and compensation is not paid. They further argued that the so-called possession documents did not carry their signatures and were merely internal records between government bodies. They also invoked Banarsi v. Ram Phal and State of West Bengal v. Gopal Krishna Das Adhikary to justify their entitlement to raise such issues in the second round of litigation.
Respondent’s Arguments
The State and the beneficiary company contended that possession was validly taken and that the award was made under the 1894 Act. They argued that the compensation was tendered to the landowners who refused to accept it, following which the money was deposited in the treasury. They relied heavily on Indore Development Authority (Lapse-5) to argue that the dual condition of non-possession and non-payment must be satisfied for lapse, and that was not the case here. They also contended that the principle of res judicata applied since the earlier writ petitions had conclusively decided the legality of the acquisition.
Analysis of the Law
The Court interpreted the provisions of the 1894 Act and Section 24(2) of the 2013 Act in light of the Constitution Bench decision in Indore Development Authority (Lapse-5), (2020) 8 SCC 129. It noted that the dual condition of non-possession and non-payment of compensation must be met for acquisition to lapse. The Court emphasized that tendering compensation and taking possession, even if disputed by the petitioners, were actions sufficient to protect the acquisition from lapse. Moreover, once an award is accepted and Section 18 invoked, it presupposes that acquisition was validly completed.
Precedent Analysis
- Indore Development Authority (Lapse-5): Cited extensively to support the view that the acquisition would not lapse if either possession had been taken or compensation had been paid/tendered.
- Banarsi v. Ram Phal, (2003) 9 SCC 606: Relied upon by the writ petitioners to argue that adverse findings in a favorable judgment can be challenged by the winning party.
- State of West Bengal v. Gopal Krishna Das Adhikary, (2007) 3 CHN 708: Cited by the petitioners to argue that if compensation is not accepted, it must be deposited in Court, not just in the treasury. This argument was rejected in light of Indore Development Authority (Lapse-5).
Court’s Reasoning
The Court concluded that the learned Single Judge erred in allowing the second set of writ petitions when the first round had already failed and established the acquisition’s validity. It ruled that:
- The acquisition was complete since the possession had been taken and compensation had been duly tendered.
- The issue of whether possession was taken or compensation paid was barred by res judicata as it had already been decided in the earlier round.
- The application of the 2013 Act was erroneous since the acquisition was completed under the 1894 Act.
The Court referred to paragraph 366 of Indore Development Authority (Lapse-5) which clarifies that tendering compensation and taking possession is sufficient; actual acceptance or physical signatures are not mandatory.
Conclusion
The appeals filed by the State and the beneficiary company were allowed. The Calcutta High Court set aside the learned Single Judge’s direction holding that the acquisition had lapsed. It also held that no proceedings under the 2013 Act were required. All connected applications were disposed of accordingly.
Implications
This judgment reaffirms the principle that once possession is taken and compensation is tendered—even if refused—the acquisition stands concluded under the 1894 Act and does not lapse under the 2013 Act. The ruling underscores the importance of Indore Development Authority (Lapse-5) and the finality that res judicata brings to previously litigated matters. This also protects completed acquisitions from being reopened based on belated or technical pleas.
Referred Judgments Summary
- Indore Development Authority v. Manoharlal, (2020) 8 SCC 129
Clarified the scope of lapse under Section 24(2) of the 2013 Act—possession and compensation both must be missing for lapse. - Banarsi v. Ram Phal, (2003) 9 SCC 606
Held that a successful party can appeal adverse findings in a favorable decree. - State of West Bengal v. Gopal Krishna Das Adhikary, (2007) 3 CHN 708
Dealt with compensation procedures under the 1894 Act; relied upon by petitioners but distinguished by the Court in this case.
FAQs
1. When does land acquisition lapse under the 2013 Act as per this judgment?
Land acquisition lapses under Section 24(2) of the 2013 Act only when both possession has not been taken and compensation has not been paid. If either action is completed, acquisition does not lapse.
2. Can landowners challenge possession and compensation after previously losing a writ petition?
No. The Court held that once such issues have been conclusively decided in earlier litigation, they are barred by res judicata and cannot be re-agitated in fresh writ petitions.
3. Is depositing compensation in treasury valid if the landowners refuse to accept it?
Yes. The Court held that tendering compensation and depositing it in treasury after refusal by landowners satisfies the requirements of the 1894 Act and does not result in lapse of acquisition.
