Land acquisition won’t lapse if compensation paid in treasury: Supreme Court

The top court observed that the land owners who had refused to accept compensation or who sought reference for higher compensation, cannot claim that the acquisition proceedings had lapsed under Section 24(2) of the Act of 2013.
Justice Arun Mishra

New Delhi, March 6 : A five-judge bench of the Supreme Court on Friday ruled that land acquisition proceedings would not lapse if the government had tendered the compensation by deposit in the treasury.

A bench headed by Justice Arun Mishra and comprising Justices Indira Banerjee, Vineet Saran, M.R. Shah and Ravindra Bhat said that the land owners cannot insist that the amount should be deposited in court in order to sustain the land acquisition proceedings under the old Act on the commencement of the new land acquisition law with effect from January 1, 2014.

It observed that acquisition will be deemed to have lapsed only when government authorities fail to take possession and pay compensation. The question before the court was whether deposit of compensation by the authorities concerned in government treasury can be termed as “paid” within the meaning of the new act.

The apex court ruling came on a case pertaining to the interpretation of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act. According to the provisions, if land is acquired and its compensation is not paid within five years, then the acquisition process would lapse.

“The provisions of Section 24(2) providing for a deemed lapse of proceedings are applicable in case authorities have failed due to their inaction to take possession and pay compensation for five years or more before the Act of 2013 came into force, in a proceeding for land acquisition pending with concerned authority as on January 1, 2014,” it said.

The top court observed that the land owners who had refused to accept compensation or who sought reference for higher compensation, cannot claim that the acquisition proceedings had lapsed under Section 24(2) of the Act of 2013.

The apex court also noted that non-deposit of compensation (in court) does not result in the lapse of land acquisition proceedings. “In case of non-deposit with respect to the majority of holdings for five years or more, compensation under the Act of 2013 has to be paid to the ‘landowners’ as on the date of notification for land acquisition under Section 4 of the Act of 1894.”

The top court emphasised that the word “or” used in Section 24(2) between possession and compensation has to be read as “nor” or as “and”. The deemed lapse of land acquisition proceedings under Section 24(2) of the Act of 2013 takes place where due to inaction of authorities for five years or more prior to commencement of the said Act, the possession of land has not been taken nor compensation has been paid.

“In other words, in case, possession has been taken, and compensation has not been paid, then there is no lapse. Similarly, if compensation has been paid, possession has not been taken, then there is no lapse,” said the court.

The court observed that the obligation to pay compensation is completely on the government, which has to tender the amount, and also there is no need to actually deposit the amount with the land owners or in the court concerned.

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