SC Constitution Bench Begins Hearing On Interpretation Of Section 24 Of New Land Acquisition Act

A Constitution Bench of the Supreme Court of India, comprising of Justices Arun Mishra, Indira Banerjee, Vineet Saran, M.R. Shah, and S. Ravindra Bhat has commenced hearing the matters relating to the interpretation of Section 24 of Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013

Referring to the Proviso to section 24(2) of the 2013 Act, which states that where an award has been made under the old Act and compensation in respect of a majority of land holdings has not been deposited in the account of the beneficiaries, then all beneficiaries shall be entitled to compensation in accordance with the provisions of the new Act, Solicitor General Tushar Mehta submitted, "earlier, the mode of payment was stipulated. Deposit was to be made only in the bank account"

"However, in the present Proviso, the reference to bank account was not accepted. It was not incorporated by the legislative wisdom of the Lok Sabha. The explanation was considered and purposefully not chosen. To 'pay' or to 'deposit' has to be taken in its natural meaning and would cover even the treasury...", he advanced.

Terming it a "casus omissus", Justice Arun Mishra noted that the compensation under the Proviso was not to be brought within the purview of section 31(2) which speaks of the transfer of the rehabilitation and resettlement award amount to the bank account number of the person concerned.

"The Lok Sabha retained the expression 'not been accepted' in the proviso. But the Rajya Sabha deleted even that. It was the legislative wisdom that acceptance by the land owners is not mandatory. The Rajya Sabha said that it could be deposited in the account of the individual. So I could deposit it in the account of Mr. X in the treasury", continued Mr. Mehta.

"This exercise suggests that a particular mode of payment though proposed was rejected. Mode is directory, payment is compulsory. The intent was to have the money deposited in the treasury and then there is a communication to the court that the money is at your disposal to decide entitlement and apportionment...if a majority of the beneficiaries are paid, then there is no lapsing (of acquisition), but a better regime of compensation...it was in the back of the legislature's mind that they are dealing with public projects. A large number of infrastructural precast were ongoing and the time and effort asked would have been beyond condemnation...", he argued.

"You cannot force anyone to accept. Some may not accept in protest, some may feel they are being insulted by offering a paltry amount, that they are being offered peanuts", remarked Justice Mishra. "They may have been misguided in not accepting", added the SG.

Justice Mishrs also observed that under the 1894 Act, there was no provision of the lapse of acquisition, while Justice Ravindra Bhat commented that where an application has been made for higher compensation, it is proof that the beneficiaries were made aware of and have rejected the compensation and hence, are not subject to section 24(2) at all.

When Justice Mishra indicated section 34 of the old Act for the payment of interest on the quantum of compensation where compensation is not paid but the possession of the land has been taken, the SG clarified that it only in case of default of payment and there is no provision of the lapse of acquisition.

"Section 24 is not a standalone provision. It has to be construed against the backdrop of the complete Act", said Mr. Mehta.