Supreme Court Slams Maharashtra Officials For Non-Payment Of Land Acquisition Compensation, Directs Recovery Of Cost From Guilty Officers

The Supreme Court today slammed Maharashtra authorities over non-payment of timely compensation to persons whose lands were compulsory acquired by the state way back in 2005. 

A bench of Justices Surya Kant and N Kotiswar Singh was dealing with the petitioner's (Chief Accounts and Finance Officer, Zilla Parishad, Beed) plea against a High Court order, whereby the Zilla Parishad was directed to pay compensation to respondent-claimants against compulsory acquisition of their lands in 2005.

Counsel for petitioner argued that the subject land was acquired by the state government (through its Collector) and therefore it was not the petitioner's liability to pay compensation. Hearing him and suggesting that the amount could be recovered from the Collector, Justice Kant commented, "You are separate from Maharashtra?"

When the counsel persisted that the petitioner was not liable to pay, as it was not even a party to the reference/execution proceedings, the bench expressed its dismay in the order as follows:

"This is a classic case where the officers/authorities of the state of Maharashtra have brazenly defieed the law thereby depriving [...] landowners of the due amount of compensation for their acquired land...No amount of compensation was paid, forcing the landowners to initiate execution proceedings for recovery of compensation amount of Rs.1,49,54,527...we are completely disappointed the manner in which the state authorities have conducted themselves in this case."

Without commenting further on the "(mis)conduct" of the Maharashtra officers, the Court dismissed the Zilla Parishad's plea, directing:

- Chief Secretary (Govt of Maharashtra), Principal Secretary (Finance) and Principal Secretary (Panchayat and Developments) shall take cognizance of the matter within 1 week;

- Necessary suggestion shall be issued for the release of the compensation amount to the respondents alongwith interest till date as also exemplary costs that may be determined by the reference court;

- The due payments must be made to the respondent-landowners and other similarly placed landowners by 31 January, 2025 and a compliance report to this effect be submitted before the High Court;

- The Chief Secretary shall seek explanation of the Collector, Beed and thereafter determine the concerned department which was liable to pay the compensation and take suitable action against the erring officials; and

- The cost of Rs.1 lakh (as imposed by the Bombay High Court) shall be recovered personally from the officers who are found guilty/responsible for non-payment of the compensation amount.

It was also noted that the High Court made certain observations against the Collector in its judgment, instead of suo motu summoning him and awarding a befitting sentence for contempt of court. As such, the Court directed that if needful is not done by 31 January, 2025, the Registrar General of Bombay High Court shall put up the matter for registration of a suo motu contempt of court proceedings against all officials and the High Court shall then proceed against them in accordance with law.

Background

State of Maharashtra issued order for construction of a water tank at a village in District Beed. For the same, land of respondent Nos.2 to 5 was acquired in 2005. A reference was raised in respect of the compensation payable against the said acquisition, which was allowed in 2015. When the compensation was not paid, an application was filed by the claimants in the execution petition stating that though the amount was lying in the account of Chief Accounts and Finance Officer, Zilla Parishad, it had not been paid.

In 2023, Civil Judge (Senior Division) passed an order for payment of the amount. When no amount was paid, the Civil Court attached the bank account of the petitioner-Zilla Parishad. The Civil Court's order was challenged before the Bombay High Court, where the Zilla Parishad claimed that it was not responsible for payment of compensation as it was not independently made party to the reference proceeding. Rather, the responsibility to compensate for the lands acquired (under the Employees' Guarantee Scheme) was of the Collector/State of Maharashtra.

The High Court ruled in favor of the respondent-claimants, noting, "all departments of State of Maharashtra are integrated and inseparable limbs and hence, it cannot be claimed that the Petitioner is not responsible for execution of the decree." Further, it was observed that the order in the reference proceedings had attained finality, as it had not been challenged. 

"This Court finds substance in the contention of learned counsel for the claimants that ordinarily claimants are required to beg before Government officials even for their rightful compensation to the authority/officers of the State Government as if they are beggars and not entitled to compensation as of right. Claimants herein are also required to run from pillar to post for 19 years", the High Court added.

Further, the High Court deprecated the apathy shown by State of Maharashtra (represented by its Collector) towards payment of compensation to the claimants. Under these circumstances, the petition filed by Zilla Parishad, Beed was dismissed. A cost of Rs.1 lakh was imposed (with joint and several liability on the Zilla Parishad and Maharashtra government), in case entire compensation amount alonwith interest was not paid to the claimants within 4 weeks.

Case Title: KONDIRAM MANIKRAO NIMBALKAR v. THE STATE OF MAHARASHTRA AND ORS., SLP(C) No. 5/2025