'Legitimate Legislative Exercise' : Supreme Court Dismisses Plea Challenging Tamil Nadu Land Acquisition Laws Act 2019

The Supreme Court has held that the Tamil Nadu State legislature had legislative competence to enact Tamil Nadu Land Acquisition Laws (Revival of Operation, Amendment and Validation) Act, 2019 and is not inconsistent with Article 254 of the Constitution of India.

"We hold the 2019 Act to be a legitimate legislative exercise and find it to be consistent with and within the four corners of Article 254 of the Constitution of India and also of the High Court judgment.", the bench comprising Justices AM Khanwilkar and Dinesh Maheshwari observed.

The Madras High Court in the 2019 decision The Caritas India v Union of India held that three land acquisition laws enacted by Tamil Nadu legislature - Tamil Nadu Highways Act 2001, Tamil Nadu Acquisition of Land for Industrial Purposes Act 1997, and Tamil Nadu Acquisition of Land for Harijan Welfare Scheme Act 1978 - as repugnant to the Right to Fair Compensation and Transparency in Land Acquisition and Rehabilitation and Resettlement Act 2013 (RFCTLARR Act) passed by the Parliament. The High Court further held that all acquisitions done under these three Acts to be illegal with effect from September 27, 2013,the date on which RFCTLARR received presidential assent,

To remedy this situation, on 19.07.2019, the State Government tabled a Bill to revive the operation of the these Acts and the same was named as Tamil Nadu Land Acquisition Laws (Revival of Operation, Amendment and Validation) Act, 2019 . This Act received the assent of the President in terms of Article 254(2)  on 02.12.2019 and was applied retrospectively from 26.09.2013 with the objective to validate all pending acquisitions on and after that date under the State enactments, otherwise quashed by the High Court.

Challenging this Act, some land owners approached the Apex Court. The following issues were considered by the bench in this case:

(i) Whether the State legislature had legislative competence to enact the 2019 Act, a retrospective validating Act?

(ii) Whether the State legislature transgressed the limits of its legislative competence having the effect of nullifying/overruling the judgment of the High Court, by enacting the 2019 Act?

(iii) Whether the 1997 Act and 2001 Act again fall foul of Article 254 on account of being repugnant to the 2013 Act, owing to the date of retrospective commencement of the 2019 Act?

State legislature had legislative competence to enact retrospective validating Act

As regards the competency of legislature to enact a retrospective validating Act, the bench referred to precedents and noted the following principles:

(i) The legislature must be having power over the subject matter as also competence to make a validating law.

(ii) There must be a clear validating clause coupled with substantive change in the earlier position.

(iii) The retrospective operation must be specified clearly.

(iv) There can be no express or declaratory overruling of the judgment of the Court.

(v) It is permissible for the legislature to make a decision of the Court ineffective by removing the material basis of the decision in the manner that the Court would not have arrived at the same conclusion had the corrected/modified position prevailed at the time of rendering the said earlier decision.

"Suffice it to observe that when voidness is a result of repugnancy between the State law and law made by the Parliament, that is, voidness under Article 254 of the Constitution, revival of such State law by enacting a subsequent amendment substantively changing the basis of the voidness and applying it retrospectively from a prior date is recognised time and again by this Court, as discussed above. We say no more.", the bench observed.

No irreconcilability between the High Court judgment and the 2019 Act

The bench also held that there is no irreconcilability between the High Court judgment and the 2019 Act. The 2019 Act is an evolution, not reiteration of the earlier position much less regression thereof, it said. The bench observed:

46. We may now consider the argument that the 2019 Act does not remove the defects found by the High Court and thus, lacks determinative principle thereby making it arbitrary. The 2019 Act is a conscious attempt by the State legislature to bring four material aspects of land acquisition under the three State enactments at par with the 2013 Act i.e., compensation, rehabilitation, resettlement and infrastructure facilities. No doubt, certain features of the stated law made by the Parliament have been left out, but that debate does not fall for our consideration as the vires of 1997 Act and 2001 Act are already under consideration in the batch of SLPs, as already pointed above. To say that failure to import all provisions of the law made by the Parliament in the State enactments results into nonremoval of defects pointed by the High Court, is nothing but a palpable misreading of the judgment of the High Court.

47. Whereas, the judgment of the High Court does not even point out the absence of compensation/rehabilitation/ resettlement/infrastructure related provisions as a defect in the State enactments. It nowhere points out the exact provisions from the State enactments which are repugnant to the law made by the Parliament. The only defect pointed out by the High Court was the impermissibility of Section 105­A (coming into effect from 01.01.2014), as a tool for reviving the State enactments once rendered repugnant (on 27.09.2013) due to law made by the Parliament. The State has since been advised to accept that defect pointed out by the High Court and has moved on from that thought process by devising a new legislative tool for validating the State enactments in line with Article 254(2). Had the legislature re­enacted Section 105­A even after the declaration of invalidity by the High Court, it would have been a case of nonremoval of defect pointed out by the High Court. In fact, that would have been declaratory overruling of the judgment of the Court by the legislature, which, as already discussed at length, is simply impermissible. The effect of the 2019 Act is to change the law retrospectively and not to overrule the judgment of the Court The underlying purpose of retrospectivity, therefore, is to cure including validate certain transactions of the past by making a law in the present and not to compete with the laws existing in the past at that point of time. In this case, the objective was to save and validate past acquisitions under the three State enactments, which were valid until the commencement of the 2013 Act but stood quashed due to the High Court decision. This was also for altering the basis of the law in existence at that point of time and providing for benefits at par with the 2013 Act, so far as it was fit in the wisdom of the State legislature. No doubt, it may appear anomalous to operationalise the 2019 Act from 26.09.2013, a day prior to the making of the 2013 Act, but it does not make any impact on the validity thereof or its substance. The date has been chosen by the State legislature only by way of abundant caution and, in our view, rightly. It is obviously relevant to overcome the repugnancy corresponding to the commencement of the 2013 Act. Adopting any other interpretation would not only be unwarranted as per the constitutional scheme but would also strike at the very purpose of a retrospective reviving and validating enactment. More so, it would open a pandora's box of unforeseen conflicts.

On retrospectivity

The bench also rejected the contention that retrospectivity from 26.09.2013 was fatal to the 2019 Act as on that date, there was no 2013 Act in operation and when the 2013 Act came into operation on 27.09.2013, the State enactments would again become repugnant. It said:

54.......The underlying purpose of retrospectivity, therefore, is to cure including validate certain transactions of the past by making a law in the present and not to compete with the laws existing in the past at that point of time. In this case, the objective was to save and validate past acquisitions under the three State enactments, which were valid until the commencement of the 2013 Act but stood quashed due to the High Court decision. This was also for altering the basis of the law in existence at that point of time and providing for benefits at par with the 2013 Act, so far as it was fit in the wisdom of the State legislature. No doubt, it may appear anomalous to operationalise the 2019 Act from 26.09.2013, a day prior to the making of the 2013 Act, but it does not make any impact on the validity thereof or its substance. The date has been chosen by the State legislature only by way of abundant caution and, in our view, rightly. It is obviously relevant to overcome the repugnancy corresponding to the commencement of the 2013 Act. Adopting any other interpretation would not only be unwarranted as per the constitutional scheme but would also strike at the very purpose of a retrospective reviving and validating enactment. More so, it would open a pandora's box of unforeseen conflicts.

Article 14 question left open

The court, however left open, the issue whether the provisions of the three State enactments and the 2013 Act violates equality under Article 14. 

"We are leaving this contention open as it is beyond the limited scope of our consideration herein. We deem it fit to desist from dilating thereon in this judgment. The petitioners herein may raise all other issues not dealt with in this judgment in relation to the validity of State enactments in the other pending cases arising from the decision of the High Court, including by getting themselves impleaded therein.", the court said.

Senior Advocate P Wilson, Advocate Suhrith Parthasarathy appeared for some of the petitioners.

Case: G. Mohan Rao vs. State of Tamil Nadu [ WPC 1411 OF 2020]
Coram: Justices AM Khanwilkar and Dinesh Maheshwari
Citation: LL 2021 SC 275

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