Land Acquisition | 2 Year Period For Lapse Of Proceedings Under 1894 Act Won't Apply After Notification Of 2013 Act : Supreme Court

The Supreme Court has held that the 2 year period prescribed under the Land Acquisition Act 1894 for the lapse of land acquisition proceedings for not delivering the award will not apply to an award passed after the notification of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013

The limitation period for passing/making of an award under Section 24(1)(a) of the Land Acquisition Act 2013 would commence from 1st January 2014, that is, the date when the 2013 Act came into force, the court observed. Under the new Act, the limitation period for lapse of the proceedings as per Section 25 is 12 months.

The bench comprising Justices AM Khanwilkar and Sanjiv Khanna observed that practical absurdities and anomalies may arise if the two-year period for making of an award in terms of Section 11A of the Land Acquisition Act 1894 commencing from the date of issue of the declaration is applied to the awards to be made under Section 24(1)(a) of the 2013 Act.

In this case, the State of Maharashtra, on 16th June 2011,  issued a land acquisition notification under Section 41 of the 1894 Act.  On 30 October 2014, the Special Land Acquisition Officer purportedly made an award in terms of clause (a) to Section 24(1) of the 2013 Act. The High Court allowed the writ petitions challenging this award holding that in terms of Section 11A of the 1894 Act, the award ought to have been passed within two years from the date of the declaration under Section 6, that is, before 8th August 2014.

Thus the issue that the Apex court had to consider was whether the two-year period specified under Section 11A of the Land Acquisition Act, 1894 will apply even after the repeal of the 1894 Act, or the twelve-month period specified in Section 25 of the 2013 Act will apply for the awards made under clause (a) of Section 24(1) of the 2013 Act?

The bench, at the outset, noted the law involved in this case, as follows:

1. Section 11A of 1894 Act requires that an award under Section 11 must be passed within a period of two years from the date of publication of the declaration and if no award is so made, the proceedings for acquisition of land shall lapse. As per the explanation, the period during which any action or proceedings to be taken pursuant to the declaration is stayed by an order of a court is to be excluded while calculating the period of two years.
   
2. In this case, Clause (a) to Section 24(1) of the 2013 Act would apply as the land acquisition proceedings initiated under the 1894 Act had not culminated into an award till the repeal of the 1894 Act. Section 24(1)(a) partly nullifies the legal effect of savings under Section 6 of the General Clauses Act as it hybridizes application of the 1894 Act and the 2013 Act. While preserving validity of the acquisition proceedings by issue of declarations under the 1894 Act, it states that all the provisions for determination of compensation under the 2013 Act shall apply. The section consciously saves the legal effect of the notifications issued under Section 4 and/or Section 6 of the 1894 Act and obviates the necessity to issue a fresh notification under the 2013 Act. This 'perseveration of the determination date' for the computation of compensation for the awards made under Section 24(1)(a) of the 2013 Act is a thought through legislative invocation that curtails time delays and cost escalation of infrastructure projects, as well as checks the post-acquisition notification malpractices, and at the same time ensures that the landowners are entitled to the benefit of the enhanced compensation as per the 2013 Act.
3. Section 25 of the 2013 Act provides that the Collector shall make an award within a period of twelve months from the date of publication of the declaration under section 19 and if no award is made within that period, the entire proceedings for the acquisition of the land shall lapse.

Taking note of the above legal provisions and also the constitution bench judgment in Indore Development Authority v. Manoharlal , the court made the following observations in para 20 of the judgment: 

1. Given the object and purpose behind Sections 24, and 26 to 30 of the 2013 Act, we notice that practical absurdities and anomalies may arise if the two-year period for making of an award in terms of Section 11A of the 1894 Act commencing from the date of issue of the declaration is applied to the awards to be made under Section 24(1)(a) of the 2013 Act. This would mitigate against the underlying legislative intent behind prescription of time for making of an award in respect of saved acquisition proceedings initiated under the repealed 1894 Act, which is two-fold: (i) to give sufficient time to the authorities to determine compensation payable under the 2013 Act; and (ii) to ensure early and expedited payment to the landowners by reducing the period from two years under Section 11A of the 1894 Act to twelve months under Section 25 of the 2013 Act.
2. In case of declarations issued in January 2012, on application of Section 11A of the 1894 Act, the time to determine compensation under the 2013 Act would vary from a day to a month, and while in cases where the declarations were issued within twelve months of the repeal of the 1894 Act, the landowners would be at a disadvantage as an award beyond the twelve-month period specified in Section 25 of the 2013 Act would be valid. In the first set of cases, given the onerous factual and legal exercise involved in determination of compensation and the need to issue notification under Section 26(2) of the 2013 Act, publication of the awards would be impractical. Hasty and incorrect awards would be deleterious for the landowners. If the awards are not pronounced, the acquisition proceedings would lapse defeating the legislative intent behind Section 24(1)(a) of the 2013 Act to save such proceedings. We would, therefore, exercise our choice to arrive at a just, fair and harmonious construction consistent with the legislative intent. A rational approach so as to further the object and purpose of Sections 24 and 26 to 30 of the 2013 Act is required. We are conscious that Section 25 refers to publication of a notification under Section 19 as the starting point of limitation. In the context of clause (a) to Section 24(1) of the 2013 Act there would be no notification under Section 19, but declaration under Section 6 of the 1894 Act. When the declarations under Section 6 are valid as on 1st January 2014, it is necessary to give effect to the legislative intention and reckon the starting point. In the context of Section 24(1)(a) of the 2013 Act, declarations under Section 6 of the 1894 Act are no different and serve the same purpose as the declarations under Section 19 of the 2013 Act.
3. Consequently, we hold that in cases covered by clause (a) to Section 24(1) of the 2013 Act, the limitation period for passing/making of an award under Section 25 of the 2013 Act would commence from 1st January 2014, that is, the date when the 2013 Act came into force. Awards passed under clause (a) to Section 24(1) would be valid if made within twelve months from 1st January 2014. This dictum is subject to the caveat stated in paragraph 16 (supra) that a declaration which has lapsed in terms of Section 11A of the 1894 Act before or on 31st December 2013 would not get revived.

The court therefore disposed of the appeals by concluding as follows:

(i) Section 25 of the 2013 Act would apply to the awards made and published under Section 24(1)(a) of the 2013 Act.

(ii) The limitation period for passing/making of an award under Section 24(1)(a) in terms of Section 25 of the 2013 Act would commence from 1st January 2014, that is, the date when the 2013 Act came into force.

(iii) Period during which the Court order would inhibit action on the part of the authorities to proceed with the making of the award would be excluded while computing the period under Section 25 of the 2013 Act.

(iv) Accordingly, period of 79 days from 26th May 2014 when the High Court had stayed operation of the notification dated 19th March 2014, till the new notification dated 13th August 2014 was issued has to be excluded.

(v) The award purportedly dated 30th October 2014, was in any case duly made on or before the extended date of 20th March 2015. Hence, the concerned award is valid. (vi) The State of Maharashtra may conduct an inquiry in reference to the imputation regarding manipulation and backdating of the subject award and take such remedial and corrective action as may be necessary and to ensure such situations do not arise in future.

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