Land Cannot Be Kept Under Temporary Acquisition For Years, It Violates Right To Property Under Article 300A : Supreme Court

The Supreme Court bench comprising Justices MR Shah and MM Sundresh have held that, “to continue with the temporary acquisition for number of years would be arbitrary and can be said to be infringing the right to use the property guaranteed under Article 300A of the Constitution of India. Even to continue with the temporary acquisition for a longer period can be said to be unreasonable, infringing the rights of the landowners to deal with and/or use the land.”

Factual Background of the Civil Appeal

The bench passed the above ruling in a civil appeal where the Appellants, who were also the original writ petitioners and the landowners, had approached the Supreme Court after being aggrieved with the judgment passed by the High Court of Gujarat, which dismissed the writ petition preferred by the appellants for quashing temporary acquisition proceedings.

That the land which was the subject matter of the proceedings is under temporary acquisition by Oil and Natural Gas Corporation Ltd. (ONGC) since the year 1996 for the purposes of oil exploration. This land was undisputedly purchased by the appellant No.1 under a registered sale deed in the year 2005. The land in question falls in the city of Ahmedabad and the prices of the land have increased manyfold and even the surrounding lands in the area are already developed. The appellants contend that they are being paid the rent at the rate of Rs. 24/- per square meter per annum for temporary acquisition.

Judicial History of the Civil Appeal

Appellants first approached the High Court in the year 2016 seeking a direction to the respondents to either acquire the land on permanent basis or release the land from acquisition. The said writ petition was disposed of in 2017 on the stand taken by the respondents that they will initiate the process for acquiring the land permanently. However thereafter no concrete steps were taken to acquire the land permanently. That after the disposal of the writ petition in 2017 and though it was assured that the process for permanently acquiring the land would be initiated, nothing was done thereafter and therefore the appellants again approached the High Court for quashing of the acquisition proceedings and to direct the respondents to release the said land from temporary acquisition and to handover vacant and peaceful possession of the land in question to the appellants. Before the High Court, it was the case on behalf of the appellants that to continue the temporary acquisition for nearly 25 years would be absolutely unreasonable and arbitrary and that too by paying abysmally low rent.

The Impugned Judgment and Order passed by the Gujarat High Court

The respondents appeared before the High Court and again submitted that the competent authority has accorded approval for acquisition of the subject land on permanent basis and the same is under process. A statement was made on behalf of the ONGC before the High Court that the acquisition proceedings would be concluded within 12 months. An undertaking on behalf of the ONGC was also placed on record. Relying upon the said undertaking, the High Court, by the impugned judgment and order, rejected the prayer for quashing temporary acquisition proceedings and enhanced rent from Rs. 24/- per square meter per annum to Rs. 30/- per square meter per annum.

Appellant’s Arguments led by Senior Advocate Gopal Shankaranarayanan

Mr. Shankaranarayanan argued that, “to continue the temporary acquisition for number of years, namely, in the present case, twenty five years and that too on payment of a meagre rent per annum is nothing but arbitrary, unreasonable and violative of right to hold property guaranteed under Article 300A of the Constitution of India.”

Another argument forwarded by Mr. Shankaranarayanan on behalf of the Appellants was that the Respondents had given an assurance to the High Court in 2016 that they would acquire the land permanently and that proceedings shall be initiated and on that assurance the High Court had disposed of the earlier writ petition. However, even after a period of six years, no further concrete steps have been taken to acquire the land permanently and the appellants are being paid only a meagre rent at present at the rate of Rs. 30/- per square meter per annum.

Respondent’s submissions led by ASG Senior Advocate Vikramjit Banerjee

Mr. Banerjee submitted that, “the land in question has been acquired by the ONGC for its oil exploration and production activities on temporary basis. The landowners are being paid the annual rent revised from time to time by the Committee…the appellants are accepting the periodically revised upward rent voluntarily.”

Mr. Banerjee further submitted that, “the proposal detailing number of acquisition to be made at Ahmedabad Asset of ONGC is pending approval from the Executive Committee/ONGC Board… therefore the process for permanent acquisition was put on hold…Respondent-ONGC needs more time to make the acquisition process in conformity with 2013 Act, to acquire the land permanently.”

Analysis and Judgment

Justice Shah in his judgment notes, “Approximately 26 years have passed and still the land in question is under temporary acquisition by the ONGC. If the land is continued to be under temporary acquisition for number of years, meaning and purpose of temporary acquisition would lose its significance. Temporary acquisition cannot be continued for approximately 20 to 25 years. It cannot be disputed that once the land is under temporary acquisition and the same is being used by the ONGC for oil exploration, it may not be possible for the landowners to use the land; to cultivate the same and/or to deal with the same in any manner.”

Justice Shah then holds, “To continue with the temporary acquisition for number of years would be arbitrary and can be said to be infringing the right to use the property guaranteed under Article 300A of the Constitution of India. Even to continue with the temporary acquisition for a longer period can be said to be unreasonable, infringing the rights of the landowners to deal with and/or use the land.”

Referring to the impugned judgment passed by the High Court, Justice Shah then notes, “as such, a writ of mandamus is already issued by the High Court directing the Corporation ONGC to complete the acquisition proceedings on or before 26.04.2023. Therefore, if the land in question is not acquired as per the writ issued by the High Court within a stipulated time, necessary consequence shall follow. The respondent-ONGC is directed to act as per the impugned judgment and order passed by the High Court.”

On the issue of adequate rent to be paid to the Appellants by the Respondents, Justice Shah states, “Now so far as the grievance with respect to the quantum of annual rent paid is concerned, the High Court has already issued directions in terms of para 7(iii) of the impugned judgment and order. Even otherwise, as per section 34 of the 1894 Act, if the appellants are aggrieved by the amount of compensation/annual rent, it will always be open to the appellants/landowners to approach the Collector and the Collector shall refer such reference to the decision of the Court.”

Case title: Manubhai Sendhabhai Bharwad and Another Versus Oil and Natural Gas Corporation Ltd. & Others  

Citation : 2023 LiveLaw (SC) 55

For Petitioner(s) Mr. Jatin Zaveri, AOR

For Respondent(s) Mr. Deepak Jain, Adv. Mr. Pradeep K.B., Adv. Ms. Jaspreet Aulakh, Adv. Mr. Tanpreet Gulati, Adv. Mr. Vaibhav Manu Srivastava, AOR Mr. Anirudha Kumar, Adv. Ms. Deepanwita Priyanka, AOR

Land Acquisition Act 1894- If the land is continued to be under temporary acquisition for number of years, meaning and purpose of temporary acquisition would lose its significance. Temporary acquisition cannot be continued for approximately 20 to 25 years. It cannot be disputed that once the land is under temporary acquisition and the same is being used by the ONGC for oil exploration, it may not be possible for the landowners to use the land; to cultivate the same and/or to deal with the same in any manner - Para 7

Constitution of India -Article 300A- To continue with the temporary acquisition for number of years would be arbitrary and can be said to be 9 infringing the right to use the property guaranteed under Article 300A of the Constitution of India. Even to continue with the temporary acquisition for a longer period can be said to be unreasonable, infringing the rights of the landowners to deal with and/or use the land-Para 7

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