When Does Land Acquisition Proceedings Start Under 1894 Act For The Purposes Of Section 24(1) RFCTLARR Act? SC Continues Hearing

Section 24 is titled 'Land acquisition process under Act No 1 of 1894 shall be deemed to have lapsed in certain cases'. On Tuesday, SG Tushar Mehta told the Court that the land acquisition proceedings can be said to have been "initiated" for the purpose of section 24(1)(a) of the new Act if the notification under section 4 of 1894 Act was issued prior to the commencement of the 2013 Act; and hence, in such cases where section 4 notification is issued and no award is made, then the acquisition would not be deemed to have lapsed and only in the procedure of fixation of compensation, the new Act will apply as per the dictum of section 24(1)(a).

Section 24(1) starts with the expression 'Notwithstanding anything contained in this Act, in any case of land acquisition proceedings initiated under the Land Acquisition Act, 1894...". Section 24(1)(a) says where no award under section 11 of the old Land Acquisition Act has been made, then the acquisition would not lapse and all provisions of the new Act relating to the determination of compensation shall apply. Section 24(1)(b) says where an award under said section 11 has been made, then such proceedings shall continue under the provisions of the old Land Acquisition Act, as if the said Act has not been repealed.

Section 4 of the 1894 Act read as follows- Whenever it appears to the appropriate government that land in any locality is needed or is likely to be needed for any public purpose or for a company a notification to that effect shall be published in the Official Gazette and in two daily newspapers circulating in that locality of which at least one shall be in the regional language and the Collector shall cause public notice of the substance of such notification to be given at convenient places in the said locality. Thereupon it shall be lawful for any officer, either generally or specially authorised by such government in this behalf, and for his servants and workmen, to enter upon and survey and take levels of any land in such locality; etc. Section 5 provided for payment of damages.Section 5A stated that Any person interested in any land which has been notified under Section 4 as being needed or likely to be needed for a public purpose or for a Company may, within thirty days from the date of the publication of the notification, object to the acquisition of the land or of any land in the locality, as the case may be. It further provided that every objection under sub-section (1) shall be made to the Collector in writing, and the Collector shall give the objector an opportunity of being heard and shall, after hearing all such objections and after making such further inquiry, if any, as he thinks necessary, make a report in respect of the land which has been notified under Section 4. Section 6 of the 1894 Act provided that when the appropriate government is satisfied, after considering the report, if any, made under Section 5-A, that any particular land is needed for a public purpose, or for a Company, a declaration shall be made to that effect under the signature of a Secretary to such government or of some officer duly authorised to certify its orders.

The bench of Justices A. M. Khanwilkar, A. S. Oka and C. T. Ravikumar was hearing SLPs against a 2017 decision of the Punjab and Haryana High Court where it was held that it cannot be said that the acquisition proceedings had been initiated as contemplated by Section 24 (1) of the New 2013 Act as the notification under section 4 of the old 1894 act had been issued before the coming into effect of the New 2013 Act from 01.01.2014. "Section 24 of the New 2013 Act relates to land acquisition process under the Old 1894 Act to be deemed to have lapsed in certain cases. The said heading of Section 24 is for providing of lapse of proceedings under the Old 1894 Act in certain cases. Sub-section (1) (a) thereof mentions that notwithstanding anything contained in the New 2013 Act, in any case of land acquisition proceedings initiated under the Old 1894 Act, where no award under section 11 of the old 1894 act had been made, then all provisions of the new 2013 act relating to the determination of compensation are to apply. Therefore, for the applicability of the provisions of clause (a) of sub-section (1) of Section 24 of the New 2013 Act are that the proceedings under the Old 1894 Act must have been initiated. It is only then that where no award under section 11 of the old 1894 act had been made, then, the provisions of the new 2013 act for determining the payment of compensation are to apply. Initiation of proceedings under the Old 1894 Act is a sine qua non for the applicability of the New 2013 Act for the purpose of determining the payment of compensation. With the mere issuance of notification under section 4 of the old 1894 act on 28.10.2013 before the New 2013 Act came into force from 01.01.2014, it cannot be said that the land acquisition proceedings had been initiated and consequently the Award having not been passed, the provisions relating to the determination of compensation in terms of the New 2013 Act were to apply. In fact, it is the declaration under section 6 of the old 1894 act which has an element of firmness of the proposed acquisition being finalised that it can be said that the acquisition proceedings had been initiated. What was a mere proposal under Section 4, it was said, becomes the subject-matter of a definite proceeding for acquisition under the Old 1894 Act. The declaration under Section 6 having been issued on 27.10.2014 after the New 2013 Act had come into effect would clearly spell out that the land acquisition proceedings had not been initiated under the Old 1894 Act before the New 2013 Act came into force. In the circumstances, the provisions of Section 24 (1) of the New 2013 Act would not apply and the acquisition proceedings being conducted under the Old 1894 Act shall be deemed to have lapsed", the High Court had concluded.

Senior Advocate Manoj Swarup, for the landowners, submitted that it is settled law that the purpose of section 4 of the 1894 Act is to carry on a preliminary investigation and it is only under section 6 of the 1894 Act that a firm declaration has to be made by the government that land with proper description and area, so as to be identifiable, is needed for a public purpose or a private company. In this regard, reliance was placed on the 1960 Constitution Bench decision of the Supreme Court in Babu Barkya Thakur's case.

It was indicated a three-judge bench of the Supreme Court in Vishnu Prasad Sharma's case (1966) has in detail clarified the individual role and purpose of section 4, 5A and 6 of the 1894 Act and held that section 4(1) authorises the appropriate government to notify that land in any locality is needed or is likely to be needed for any public purpose. It was shown by Mr. Swarup that the court had further observed therein that in this notification, the land needed is not particularised but only the locality where the land is situated is mentioned; a notification under section 4 of the Act envisages preliminary investigation and it is only under section 6 that the government takes a confirm declaration. It was submitted that reading sections 4, 5A and 6 together, the Court had found that the notification under section 4(1) specifies merely the locality in which the land is to be acquired and then under section 4(2) survey is made and it is to be considered whether the land or part of it is adapted to the purpose for which it is required and maps are prepared of the land proposed to be taken. Then after objections under section 5A have been disposed off the government has to decide what particular land out of the locality specified in the notification under section 4(1) it will acquire. It then makes a declaration under section 6 specifying the particular land that is needed. Once a declaration under section 6 particularising the area out of the area in the locality specified in the notification under section 4(1) is issued, the remaining non-particularised area stands automatically released. It was advanced by Mr. Swarup that the Court had opined that the purpose of the notification under section 4(1) is at this stage over and it may be said that it is exhausted after the notification under section 6.

It was further indicated that that settled law by the Constitution bench referred above was further relied by the three judges bench of the Supreme Court in Fomento resorts and hotels case (1985), wherein thw court took a view that initiation of the acquisition proceedings for all practical purposes is only being after section 6 notification of the 1894 act.

"Section 24(1) deals with two specific situations where the land acquisition proceedings were initiated before the repeal of the 1894 Act, namely- (a) where an award has been made; (b) where an award has not been made. As per clause (a) to section 24(1) of 2013 Act, where the land acquisition proceedings initiated under the 1894 Act had not culminated into an award till the repeal of the 1894 Act on or before 31 December 2013, all the provisions for determination of compensation under the 2013 Act shall apply. As per clause (b) to section 24(1), where an award under section 11 of the 1894 Act has been made on or before 31 December 2013, the proceedings would continue under the repealed 1894 act, notwithstanding its repeal, and in such cases, the 2013 act will not apply", it was advanced.

It was further submitted by Mr. Swarup that the Supreme Court in Maharashtra Vidarbha Irrigation Development Corporation v. Mahesh (2022) examined the interpretation of section 24(1), section 114 of the 2013 Act vis-a-vis section 6 of the General Clauses Act and held that in terms of section 24(1) of the 2013 Act, section 114 of the 2013 Act as well as section 6 of the General Clauses Act will not apply to the extent hindered by section 24(1) of the 2013 act. "The reason is that section 114 of 2013 act, while accepting the applicability of section 6 of the general clauses act, makes its application subject to 'save as otherwise provided' in the 2013 Act. Further, section 6 of the general clauses act itself states that the general savings will not apply when the legislative intent is contrary. Section 24(1)(a) partially nullifies the legal effect of savings under section 6 of the general clauses act as it hybridises application of the 1894 act and the 2013 act. By preserving validity of the acquisition proceedings by issue of declarations under the 1894 act, it states that all the provisions for determination of compensation under the 2013 act shall apply. Section 25 of 2013 act applies to awards made under section 24(1)(a) of the 2013 act and the period of limitation of 12 months would commence from 1 January 2014", the Supreme Court was submitted as having observed in the 2022 decision.

For the landowners, submissions were also advanced by, inter alia, Senior Advocates Ranjit Kumar and Shyam Diwan.

Rejoinder by SG Tushar Mehta

Beginning his rejoinder, SG Tushar Mehta submitted, "The scope of the present proceedings is unnecessarily being widened. 'Notwithstanding anything contained in this act,' (with which section 24(1) starts)-that will take care of 114…'in any case of land acquisition proceedings initiated under the land acquisition act, 1894' (as section 24(1) further reads)- Your lordships may only decide when they are said to be initiated. Thereafter, whether it would fall under (a) or (b) is completely irrelevant. The section then will take care of itself. Your Lordships may only decide whether it is initiated at section 4 stage or section 6 stage. It is not necessary to examine why (a) is worded the way it is worded or why (b) is worded the way it is worded"

"None of my learned friends for the landowners could deal with the historical background under which the section has come to be couched the way it is couched. The purpose and intent of the legislature which is manifested is that public projects, where they are initiated, should not be required to start from scratch one because it wastes time and also escalates the cost. But we will not be able to ignore the legislative history behind it. The purpose is if the award is not issued, then the benefit should go to the landowner, namely, that the compensation to be decided under the new act. There are two cut-off dates-Section 24 will apply only when the proceedings are initiated. That is the first cut-off date. If that hurdle is crossed, the second cut-off date is whether the award is passed or not. Your Lordships ships are not concerned with the second cut-off date in these group of matter. Your lordships are not concerned with the broad sweep of 24, your lordships are only concerned with when it is initiated", he continued.

Bench: "The argument on the other side was if we accept section 4 as the initiation, and then look at clause (a), there will not be any final enquiry, no section 6, there will be just final adjudication. That was the argument in the context of Article 300A"

SG: "That argument is to be decided only if there is a validity challenge to section 24. 300A merely says that nobody will be deprived of his property except in accordance with law. I understand that law means law which meets the test of article 14 and all other constitutional requirements. But the very intent and purpose of (a) and (b)- the history is that the legislature is trying to give a cut-off date and the cut-off date is so placed that the benefit goes to them. Hypothetically, let us take that section 6 is the initiating point. I am posing a question to myself- how answering that question that way will make (a) 300A compliant? Their argument was that only the provisions relating to determination of compensation will apply. That is something which is in favour of the land holder. The legislature while putting the cut-off date has said 'let us give the best available regime when award is not made'. But if it is made then we will not create a situation where there is a price escalation. In absence of any challenge to section 24, as an interpretative rule, your lordships may not read it in such a fashion which defeats the very object of the act"

Justice Khanwilkar: "The whole problem arises because the 1894 act does not mention expressly when the acquisition proceedings are initiated. Now we will go by section 24 which says that 'land acquisition proceedings initiated'. That is the expression. In section 6(3), there is some clue as to when it is initiated [section 6(3), 1894 Act provided that the said declaration shall be conclusive evidence that the land is needed for a public purpose or for a Company, as the case may be; and, after making such declaration the appropriate government may acquire the land in manner hereinafter appearing]…So all that which was done before was only to determine public purpose and there was no decision to acquire. So the acquisition is as 'hereinafter appearing' from section 6. That is the point now we may have to struggle for…We will have to give strict interpretation to 'land acquisition proceedings initiated' and juxtapose it with this which says acquisition is to proceed in the manner 'hereinafter appearing'"

SG: "Section 6 cannot be reached without section 4. Section 4 is sine qua non. There was nothing which prevented the legislature to say that the date from which the declaration under section 6 of public purpose is made under the old act, the land acquisition proceedings are initiated. The only test is to go by the Act itself- its Part 2 on 'Acquisition' which starts with section 4"

Justice Khanwilkar: "The argument we have to deal with is that the President has given assent to the new Act on 27th of September 2013. So it was all known everywhere. Yet section 4 notifications are issued after 27 September 2013. So it is all colourable exercise. It was said that on December 31, when everybody is partying, these section 4 notifications were issued (before 1.1.2014 which is the date of coming into force of the new Act). That is the argument"

SG: "There may be an argument of prejudice…"

Justice Khanwilkar: "It is not an argument of prejudice. It is an argument of 300A. Article 14 may also come"

SG: "That may not perhaps make any difference so far as your lordships are concerned. Take an example-there is a huge chunk of land being acquired for a huge public project. Your lordships know from experience that every time, it is not under section 4 notification which is solitary that that entire area is acquired…"

Justice Khanwilkar: "Then we can always construe it in a manner which is consistent with constitutional ethos and morality. If it is an isolated case, different approach may be possible. But if it is a pattern which we may find that in one particular state it has happened, then the matter may have to be considered in a different perspective altogether. If it is an isolated case, then it is different, but if it is a pattern, then we may have to interpret accordingly. Give us break up of how many section 4 notifications were issued after 27th September 2013 and before 1.1.2014, and section 6 notifications also"

SG: "There are large number of judgments that even colourable exercise of power does not mean that the section is wrong"

Justice Khanwilkar: "we are not saying that the section is wrong. We are only on how that provision has been misused or that particular period particular period has been misused by the authorities"

SG: "generally what happens is that it is very difficult to presume mala fide in the mind of an officer when he is issuing section 4, unless you say he is my in law and there is some bad blood…when a huge bulk of land is acquired, section 4 notifications come one after the other as the requirement grows, as the project commences…"

SG: "The other side argued that if somebody issued notification on the 31st december, that, on the facts of the case, can be colourable exercise. Your lordships have seen large number of cases where section 4 notification is challenged, they are said to be amenable to judicial review and they are set aside. Rarely do your lordships say that it is only a preliminary notification and therefore we will not interfere. Your Lordships say that we are satisfied on the ground that there is no public purpose, that it did not proceed with the enquiry which was required and so on. In a given case, if your lordships find that a particular section 4 notification was deliberately issued…"

Justice Khanwilkar: "No, no, not necessary. Therefore we want to break up of how many section 4 notifications were issued after 27th September 2013 and before 1.1.2014 and section 6 notifications also. Because the regime under new act by virtue of clause (a) will not be available to those proceedings which fall in the period after presidential assent and before 1.1.2014"

SG: "We will do the needful"

SG: "There was nothing which prevented the legislature, while drafting section 24, to say that if the proceedings have reached the stage of declaration that the land is required for public purpose, then (a) and (b) would follow. Legislature therefore very widely keeps it open at 'initiation of proceedings' and the purpose is to ensure there is no delay, don't put the clock back, don't compel them to start from scratch as that would again delay and would escalate the cost also"

Justice Khanwilkar: "Suppose we accept your argument, even then the question will still remain because that part is not available in respect of notifications issued after September 27, 2013, which are said to be only to hasten the process and avoid section 15 inquiry under the new act…"

SG: "I will answer tomorrow as this will have wide ramifications"

SG: "The other side also spoke of the effect of repeal under the General Clauses act. Section 114(2) (of the 2013 Act on 'Repeal and Saving') starts with 'save as otherwise provided'. It does not include 24. Section 24 is the stand-alone section, it is a transitory provisions, it will die its death by a lapse of time. But what to do when there is a transition from the old act to a new act?"

The bench then proceeded to dictate the following order- "We have heard the counsel for the parties on the principle question involved in this matter regarding the width of expression 'land acquisition proceedings initiated' posited in section 24 of the 2013 act. Although the group of cases involve other issues, for the time being, we do not intend to enter upon discussion on those issues until the principle issue is answered. On the principal issue as aforesaid, all contentions on both sides were heard in depth. Judgment reserved. List tomorrow for the SG to submit break-up of cases in which section 4 notification has been issued after 27 September 2013 and before 1 January 2014, and number of cases in which section 6 notification has been issued during such time"