Land Acquisition; Bhupatsinh Vitthalbhai Vasava Vs. State [Gujarat High Court, 05-08-2016]

Right to Fair Compensation and Transparency in Land Acquisition Rehabilitation and Resettlement Act, 2013 – Ss. 24(2) & 31 – Payment of Compensation or deposit of same in Court – “paid” – meaning of – it is not possible of precise definition and the interpretation varies from statute to statute and, sometimes, depending on the situation – the person interested in the present case, did not refuse to receive the compensation – he, in fact, volunteered, remained present before the Collector and also accepted the payment voucher – his action, thereafter, of not physically collecting the compensation would not change the situation – In the result, the petition is dismissed.


IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI and HONOURABLE MR.JUSTICE Z.K.SAIYED

Date : 03/03/2016

SPECIAL CIVIL APPLICATION NO. 9045 of 2015 FOR APPROVAL AND SIGNATURE:

BHUPATSINH VITTHALBHAI VASAVA….Petitioner(s) Versus STATE OF GUJARAT & 2….Respondent(s)

Appearance: MR SP MAJMUDAR, ADVOCATE for the Petitioner(s) No. 1 MR. NISHIT P GANDHI, ADVOCATE for the Petitioner(s) No. 1 MR RAKESH PATEL, AGP for the Respondent(s) No. 1 – 3

JUDGMENT

(PER : HONOURABLE MR.JUSTICE AKIL KURESHI)

1. The petitioner has prayed for a declaration that the acquisition of his land has lapsed by virtue of

# Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition Rehabilitation and Resettlement Act, 2013

(‘the Act of 2013’ for short). In the alternative, the petitioner has prayed for a direction to the authorities to withdraw from the acquisition of the land in question.

2. Brief facts are as under:

The petitioner is a successor in title along with other co-owners of land bearing Revenue Survey Nos. 156/1 and 156/2 of Village Vadia, Tal. Nanod, Dist. Bharuch. Such land was required by the State for the public purpose of constructing a guest house. For acquiring such land, notification under Section 4(1) of the Land Acquisition Act, 1894 (‘the Act of 1894’ for short) was issued on 23.03.1983. After following the required procedure, Special Land Acquisition Officer passed his award dated 27.07.1984. The case of the petitioner is that, having acquired such land, the authorities never constructed the guest house at the said site and thus, many years after the acquisition, the land, even today, remains open unused land. The petitioner contends that by virtue of Section 24(2) of the Act of 2013, such acquisition would lapse. According to the petitioner, compensation for the land in question was never paid nor received by the owners. Though fleetingly referred to in the writ petition that the possession was also not taken over, at the time of the arguments, learned counsel for the petitioner confined his submissions to the question of payment of compensation.

3. In the context of the alternative prayer made by the petitioner it was submitted that, the land having remained unused for decades together, the Government should be directed to return the same to the original land owners. However, realizing the limitation of such a contention, in view of the judgement of the Supreme Court in case of

# V. Chandrasekaran and anr vs. Administrative Officer and ors reported in (2012) 12 SCC 133

and other similar judicial pronouncements, counsel for the petitioner made detailed submissions only with respect to the non-payment of compensation.

4. Learned advocate Mr. Majmudar for the petitioner drew our attention to the documents on record and pointed out that even as per the respondents, grandfather of the petitioner had merely received a voucher for payment of Rs. 36,997.80 towards compensation for the land. However, such compensation was never actually received. Our attention was drawn to the letter dated 29.05.2001 as at Annexure E to the petition, in which, the Special Land Acquisition Officer conveyed to one of the co- owners of the land that, so far, the amount of compensation is not received and is lying in the Government Treasury. He may, therefore, remain present so that, amount can be paid. Counsel for the petitioner also relied on a document received by him in response to the queries raised under Right to Information Act to contend that, as per the records of 30.03.1888, the amount was still lying with the Government Treasury.

5. On the basis of such documents, counsel submitted that mere issuance of a voucher in favour of the persons interested would not be sufficient. What is required under Section 24(2) of the Act is, the payment of compensation or, if such payment is not received by the owner for any reason whatsoever, the same would have to be deposited before the Reference Court. In the present case, the money is still lying with the Government Treasury clearly pointing out that the compensation was never paid. In this respect, counsel placed heavy reliance on the decision of

# Pune Minicipal Corporation and anr vs. Harakchand Misirimal Solanki and ors reported in (2014) 3 SCC 1863.

6. On the other hand, learned AGP opposed the petition contending that the acquisition proceedings were completed way back in the year 1984. The compensation was tendered to the land owner. Thereafter, there was no further requirement to deposit the same with the Reference Court. At any rate, such issues cannot be reopened after such a long period of time.

7. Section 24 of the Act of 2013 pertains to land acquisition process under the Act No.1 of 1894 shall be deemed to have lapsed in certain cases. Sub-section (1) of Section 24 provides that notwithstanding anything contained in the Act, in any case of land acquisition proceedings initiated under the Act of 1894, where no award under Section 11 has been made, then, all provisions of the Act of 2013 relating to the determination of compensation shall apply; or where an award under Section 11 has been made, then such proceedings shall continue under the provisions of the Act of 1894, as if the same has not been repealed. Sub-section (2) of Section 24which is important reads as under:

(2) Notwithstanding anything contained in sub section (1), in case of land acquisition proceedings initiated under the Land Acquisition Act, 1894 where an award under the said section 11 has been made five years or more prior to the commencement of this Act but the physical possession of the land has not been taken or the compensation has not been paid the said proceedings shall be deemed to have lapsed and the appropriate Government, if it so chooses, shall initiate the proceedings of such land acquisition afresh in accordance with the provisions of this Act:

Provided that where an award has been made and compensation in respect of a majority of land holdings has not been deposited in the account of the beneficiaries, then, all beneficiaries specified in the notification for acquisition under Section 4 of the said Land Acquisition Act, shall be entitled to compensation in accordance with the provisions of this Act.”

8. It can thus be seen that the provisions of sub-section (2) of Section 24 would apply in a case, where acquisition of land has been initiated under the Act of 1894 and award under Section 11 has been made five years or more prior to the commencement of the Act of 2013. Besides this condition, if it is found that the physical possession of the land has not been taken or the compensation has not been paid, in such circumstances, the proceedings shall be deemed to have lapsed. It would, however, be open for the appropriate Government, if it so choses, to initiate proceedings for acquiring such land afresh in accordance with the provisions of the Act of 2013.

9. It is, in this background, that we need to inquire in the present case whether the compensation was paid or not? We may notice that Section 31 of the Act of 1894 pertained to payment of compensation or deposit of the same in Court. Relevant portion of Section 31 reads as under:

# “31. Payment of Compensation or deposit of same in Court.

(1) On making an award under Section 11, the Collector shall tender payment of the compensation awarded by him to the person interested entitled thereto according to the award, and shall pay it to them unless prevented by some one or more of the contingencies mentioned in the next sub section.

(2) If they shall not consent to receive it, or if there be no person competent to alienate the land, or if there be any dispute as to the title to receive the compensation or as to the apportionment of it, the Collector shall deposit the amount of the compensation in the Court to which a reference under section 18 would be submitted:

Provided that any person admitted to be interested may receive such payment under protest as to the sufficiency of the amount:

Provided also that no person who has received the amount otherwise than under protest shall be entitled to make any application under section 18:

Provided also that nothing herein contained shall affect the liability of any person, who may receive the whole or any part of any compensation awarded under this Act, to pay the same to the person lawfully entitled thereto.”

10. Under sub-section (1) of Section 31 of the Act of 1894, therefore, on making an award under Section 11, the Collector would tender payment of the compensation awarded by him to the persons interested and entitled thereto according to the award, and would pay it to them unless prevented by one or more of the contingencies mentioned in sub section (2). Sub section (2), in turn, provides that, if the persons interested do not consent to receive it, or if there be no person competent to alienate the land, or if there be any dispute as to the title to receive the compensation or as to the apportionment of it, the Collector shall deposit the amount of compensation in the Court to which a reference under Section 18 would be submitted.

11. Thus, the Collector, upon making of the award under Section 11 has to tender the payment of compensation to the persons interested and pay the same unless prevented on account of any of the contingencies arising under sub section (2). These contingencies are, (i) if the person interested does not consent to receive it, or (ii) if there be no person competent to alienate the land, or (iii) if there be any dispute as to the title to receive the compensation or (iv) as to the apportionment of it. If, any of these eventualities prevent the Collector from paying the compensation to the persons interested, as per the award, it would be his duty to deposit the amount of such compensation in the Reference Court.

12. In this context, the Supreme Court in case of Pune Municipal Corporation and anr vs. Harakchand Misirimal Solanki and ors (supra), which is a lead case on the question of requirement of payment arising in sub-section (2) of Section 24 of the Act of 2013, interpreted that the term “paid” used in the said section cannot be equated with the term “offered” or “tendered”. At the same time, the said term cannot be given a literal interpretation which would ignore the procedure, the mode and the manner of deposit provided under sub-section (2) ofSection 31 of the Act of 1894, in the event of happening of any of the contingencies contemplated therein which may prevent the Collector from making actual payment of compensation. The Court, therefore, concluded that for the purpose of Section 24(2), the compensation shall be regarded as paid, if the compensation has been offered to the persons interested and such compensation has been deposited in the Court where reference under Section 18 can be made on happening of any of the contingencies contemplated under Section 31(2) of the Act of 1894. The Court observed that the compensation may be stated to have been paid within the meaning of Section 24(2) when the Collector has discharged his obligation and deposited the amount of compensation in Court and made that amount available to the interested persons to be dealt with as provided under Section 32 and 33 of the Act of 1894.

13. Thus for the purpose of interpreting the term “paid” used in section 24(2) of the Act of 2013, the reference is made to the procedure envisaged in Section 31 of the Act of 1894 for payment of compensation upon the Collector passing the award. Sub-section (1) of Section 31 requires the Collector to tender and pay the compensation unless prevented by the contingencies provided in sub-section (2). In such a situation, he would have to deposit the amount of compensation before the Reference Court. Facts in the present case, are peculiar and we have proceeded on the premise that the petitioner has, so far, not received the compensation. However, the reason behind such non-receipt needs closer examination. As noted, the grandfather of the petitioner did remain present before the Collector soon after the award was passed and also received a payment voucher duly issued by the Collector for payment of Rs. 36,997.80 by way of compensation. He put his endorsement to the effect that “this amount I am accepting under protest”. His thumb impression was certified and countersigned by the Talati of the village. To these aspects, even the petitioner does not raise any dispute. What he would however, point out is that, this document contained a direction to the Special Treasury Officer, Rajpipla, to pay in cash the said sum of Rs. 36,997.80. According to the petitioner, therefore, this would demonstrate that the petitioner having received the vouchers would have to go the Government Treasury Office and collect the amount which, the petitioner had not done. Under the circumstances, only choice with the Collector was to deposit such sum before the Reference Court, failing which, the consequences envisaged in Section 24(2) of the Act of 2013 would follow.

14. We are unable to accept such a contention. The Collector having tendered the payment of compensation to the person interested, he accepted the payment voucher with endorsement that he is receiving such money under protest. If thereafter, the recipient of the voucher did not turn up before the Government Treasury to actually collect such sum, we do not think that the contingencies envisaged under sub-section (2) of Section 31 of the Act of 1894 can be stated to have arisen. The voucher was issued for the person interested to collect the money. This is not a case where the person interested did not appear or refused to accept the compensation. It is a case, where the person interested remained present, accepted the voucher putting a remark that he was accepting the money under protest. The Collector could then only wait for the recipient of the voucher to collect the money from the Government Treasury where the money was lying. None of the four contingencies envisaged in sub-section (2) of Section 31 would cover the present case. The term “paid” used in the context Section 24(1)(a) and 24(1)(b) of the Act of 2013 must, therefore, cover such a situation.

15. The issue can be looked from slightly different angle. In terms of sub sections (1) and (2) ofSection 31, the Collector would make an attempt to pay compensation to the persons interested soon after the award is passed. However, if such payment is not made on account of any of the contingencies referred in sub- section (2), his duty would be to deposit such amount of compensation before the Reference Court. In the present case, since the person interested had already accepted the payment voucher, the such sum had to remain in custody of the Government Treasury. The Collector, therefore, could not have transferred such sum to the Reference Court. The Collector had to, therefore, make such matching sum available in Government Treasury for the petitioner to claim. At the same time, the Collector cannot be expected to also transfer such sum before the Reference Curt. At any rate, the Collector cannot be expected to park the amount of compensation at two different places at the same time. Neither the law nor the correct interpretation of the relevant provisions can bring about such a situation. Learned counsel for the petitioner, however, submitted that when, for a long period of time, the person interested did not actually collect the money, the Collector then at least should have deposited the same before the Reference Court. We do not see any warrant for such an interpretation. Firstly, since the law does not recognize any such situation. Secondly, if such an interpretation is accepted, it is unclear as to when would one draw a line for the Collector to wait for the person interested to come and actually collect the money from the Government Treasury and when the Collector can give up all such hopes and transfer the money before the Reference Court.

16. In case of

# The Benaras State Bank Ltd. vs. The Commissioner of Income Tax, U.P. reported in AIR 1970 SC 281

the expression “paid” in the context of dividend used in Section 16(2) of the Income Tax Act, 1922 came up for consideration. It was held that the dividend cannot be deemed to have been paid on the date, on which it was declared. It was observed that expression “paid” inSection 16(2) does not contemplate actual receipt of the dividend by the member in general, dividend may be said to have been paid when the company discharges its liability and makes the amount of dividend unconditionally available to the member entitled thereto.

17. In case of

# J. Dalmia vs. Commissioner of Income Tax, New Delhi reported in AIR 1964 SC 1866

amount of dividend in context of Section 16(2) of the Income Tax Act, 1922, the Supreme Court observed that expression “paid” under said section does not contemplate actual receipt of the dividend by the member and in general, dividend may be said to have been paid when the company discharges its liability and makes the amount of dividend unconditionally available to the member entitled thereto. Such view was reiterated in the decision in case of Ramesh R. Saraiya vs. Commissioner of Income Tax, Bombay City I reported in 55 ITR 699.

18. In case of

# Presidency Talkies Pvt. Ltd. vs. Presiding Officer, Labour Court, Madras and anr reported in AIR 1969 Madras 87

the Division Bench of the High Court in the context of requirement of payment of one month wages under Section 33(2) of the Industrial Disputes Act observed that offer to pay and where management makes the offer and employee refuses to accept the same, the same would be adequate compliance.

19. It can thus be seen that the term “paid” is not possible of precise definition and the interpretation varies from statute to statute and, sometimes, depending on the situation. The literal interpretation, as suggested by the counsel for the petitioner in the present case would lead to higher anomalous situation. Even the Supreme Court in case of Pune Minicipal Corporation and anr vs. Harakchand Misirimal Solanki and ors (supra) did not accept such interpretation in all its rigidity and it was held that when the person interested does not accept the compensation, deposit before the Reference Court by the Collector would amount to the compensation having been “paid”. As noted, the person interested in the present case, did not refuse to receive the compensation. He, in fact, volunteered, remained present before the Collector and also accepted the payment voucher. His action, thereafter, of not physically collecting the compensation would not change the situation.

20. In the result, the petition is dismissed.

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