Land Acquisition Act | Right To Receive Compensation Crystalizes Only After Claims Over Dispute On Apportionment Is Decided: Telangana HC

The Telangana High Court has s that the entitlement to receive compensation under the Land Acquisition Act would crystallize only after the competent court–to whom a reference is made over a dispute as to the apportionment of compensation–decides the rival claims and rules in the claimant's favour.

The high court referred to the court's decision in a 2024 writ petition wherein it had  referred to Supreme Court's decision in Madan and another v/ s. State of Maharashtra (2014) in which the apex court had said that "the right to receive compensation under the award would crystallize after apportionment is made in favour of a claimant". The Supreme Court had further said that it is only thereafter that a reference under Section 18 for enhanced compensation can be legitimately sought by the claimant in whose favour the order of apportionment is assed either by the Court in the reference under Section 30 of in the civil suit, as maybe. 

Justice T Vinod Kumar in his order thus noted that the high court had in the 2024 writ petition held that "entitlement to receive compensation would crystallize only when the Court to which a reference is made under Section 30 of the Act determining the petitioner's entitlement".

Section 30 states that when the amount of compensation has been settled under section 11, if any dispute arises as to the apportionment of the same or any part thereof, or as to the persons to whom the same or any part thereof, is payable, the Collector may refer such dispute to the decision of the Court.

With respect to the case before it the high court said, "In the facts of the present case, though an award was passed in respect of the land acquired from the petitioner's husband to an extent of Acs.12.23 guntas under award proceedings dt. 08.01.2001, the District Collector on noticing the existence of dispute as to whether it is the petitioner's husband who is entitled to receive compensation or the other claimants, who had put up the rival claim to the aforesaid extent of land had referred the matter to Court for resolving the dispute. Upon the District Collector making reference to Court under Section 30 of the Act, the said reference was numbered as O.P.No.74 of 2003. The Court thereafter had decided the dispute as to apportionment of the land and held that the rival claim to the subject land put up by the others cannot be accepted".

"It is only when the competent Court had passed an order adjudicating the rival claims, the rights of the parties can be said to have been crystallized. Thus, it is only on 11.02.2013, the petitioner herein being the legal representative of the 5th respondent – claimant in the award is declared as entitled to receive the compensation in respect of the land to an extent of Acs.12.23 guntas belonging to her husband having acquired and not at any time before," the court said. 

Section 18 of the Act states that any person interested who has not accepted the award may, by written application to the Collector, require that the matter be referred by the Collector for the determination of the Court, whether his objection be to the measurement of the land, the amount of the compensation, the persons to whom it is payable, or the apportionment of the compensation among the persons interested.

Background

The petitioner's husband was owner of an agricultural land situated at Bhainsa Village in erstwhile Adilabad District which is now Nirmal District. The petitioner said that out of the land belonging to the her husband, the land to an extent of Acs.12.23 guntas was acquired by the respondents for sub-mergence due to Suddavagu Project Bhainsa (Right Flank) by issuing land acquisition notification under Section 4(1) of the Land Acquisition Act. 

The respondents-authorities pursuant to the notification issued under Section 4(1) passed an award in March 2002 in respect of her husband's land and land owned by others which got affected by the sub-mergence. 

As there were rival claims, the District Collector had made a reference under section 30 to the Court for resolving the dispute as to apportionment of compensation of the land and the compensation. After such reference was made, the same was taken on record on the file of the Senior Civil Judge at Nirmal.

The trial court by its 2013 order held that the petitioner being the legal representative of claimant No.5 in the award proceeding is entitled to receive compensation to the extent of Acs.12.23 guntas out of the acquired land. As the petitioner did not agree with the compensation which was determined under the award, she approached the respondents-authorities and submitted an application on seeking reference to Court under Section 18 of the Act for enhancement of compensation.

She claimed that inspite of submitting application after adjudication of reference under Section 30, within the time prescribed period under the Act, the same has not been referred to the Civil Court till date.

On the other hand, the revenue officials contended that as per section 18, the application should be made within 60 days from the passing of the order of compensation. In the present case, the order of compensation was passed in 2002, and an application for enhancement was made in 2013.

The Bench after hearing both sides, distinguished between section 18 and section 30 of the Act. It clarified that only once the dispute of apportionment was cleared, could the issue of value of compensation be gone into.

"the petitioner's entitlement to receive compensation has been crystallized only on 11.02.2013 when judgment and decree is passed in O.P.No.74 of 2003. It is only thereafter, the petitioner could have submitted an application to the District Collector seeking reference to Court under section 18 of the Act with regard to the compensation determined under the award". 

Relying on Supreme Court's decision in Sharda Devi vs. State of Bihar judgment, it said, "Thus, in the facts of the present case, the petitioner's entitlement to receive compensation has been crystallized only on 11.02.2013 when judgment and decree is passed in O.P.No.74 of 2003. It is only thereafter, the petitioner could have submitted an application to the District Collector seeking reference to Court under section 18 of the Act with regard to the compensation determined under the award". 

It noted that the petitioner's application seeking reference to Court under Section 18 was filed within two months from the date of the notice reckoned with the date of the order of the Court. It thus said that the petitioner's plea was filed in time for the authorities to refer the same to Court under Section 18. 

Disposing of the plea the court directed that the petitioner's application be referred to the competent court within of six weeks from receiving copy of the present order.

Case title: Rizvana Begum W/o M.A.Quadeer VS. The Principal Secretary

Counsel for petitioner: Qazi Syed

Counsel for respondent: GP for acquisitions.

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