Andhra Pradesh High Court - Amravati

The Managing Director, vs Smt. Konduru Padmavathi, on 22 March, 2021

Bench: Arup Kumar Goswami, C.Praveen Kumar

     IN THE HIGH COURT OF ANDHRA PRADESH : AMARAVATI


 HON'BLE MR. JUSTICE ARUP KUMAR GOSWAMI, CHIEF JUSTICE
                                         &
              HON'BLE MR. JUSTICE C. PRAVEEN KUMAR

                WRIT APPEAL Nos.167 and 172of 2019
                    (Taken up through video conferencing)

W.A.No.167 of 2019

The Managing Director,
A.P. Industrial Infrastructure Corporation Limited,
Parishram Bhavan, Basheerbagh, Hyderabad.
              .. Appellant
    Versus

Smt. Konduru Padmavathi, W/o. Sri K. Venkateshwarlu,
Aged about 69 years, Occ: Housewife,
R/o. Ponnur Village & Mandal, Guntur District,
and others.
                                                   .. Respondents

Counsel for the appellant : Mr. J. Ugranarasimha

Counsel for respondent Nos.1 to 3 : Mr. Y.V. Ravi Prasad, Sr.Counsel, assisted by Ms. A. Anasuya

Counsel for respondent Nos.4&5: GP for Land Acquisition

W.A.No.172 of 2019

The Managing Director, A.P. Industrial Infrastructure Corporation Limited, Parishram Bhavan, Basheerbagh, Hyderabad.

.. Appellant

Versus

Smt. Konduru Padmavathi, W/o. Sri K. Venkateshwarlu, Aged about 69 years, Occ: Housewife, R/o. Ponnur Village & Mandal, Guntur District, and others.

..Respondents

Counsel for the appellant : Mr. J. Ugranarasimha

Counsel for respondent No.1 : Mr. Y.V. Ravi Prasad, Sr.Counsel, assisted by Ms. A. Anasuya

Counsel for respondent Nos.2 & 3: GP for Land Acquisition

HCJ & CPK,J W.A.Nos.167&172 of 2019

Dates of hearing : 04.03.2021 & 09.03.2021

Date of pronouncement : 22.03.2021

COMMON JUDGMENT (Per Arup Kumar Goswami, CJ)

W.A.No.172 of 2019is preferred against a judgment and order dated

29.04.2014 passed by a learned single Judge in W.P.No.24548 of 2006,

whereby the learned Judge, relying upon the decision of the Hon'ble

Supreme Court in the case of Pune Municipal Corporation v.

Harakchand Misirimal Solanki,reported in (2014) 3 SCC 183,allowed

the writ petition holding and directing as follows:

"7. In the instant case also though the Sub-Collector-

cum-Land Acquisition Officer passed award as long back as on

23.12.2006, as per the said award the authorities kept the

compensation amount in revenue deposit. In view of the

mandatory provisions of the new legislation 2013 and in view of

the law laid down by the Hon'ble Supreme Court in the above

referred judgment, such revenue deposit would not amount to

payment of amount of compensation to the petitioner and in the

considered opinion of this Court, the impugned proceedings,

which culminated in the award dated 23.12.2006 cannot stand

for judicial scrutiny, and the same are liable to be invalidated.

8.For the aforesaid reasons and having regard to the

principles laid down by the Hon'ble Supreme Court in the above

referred judgment, this writ petition is allowed and the impugned

proceedings, which culminated in passing of award by the Sub-

Collector, Gudur-cum-Land Acquisition Officer vide proceedings

Rc.No.A 2688/2006 (Award No.34/2007-07) are hereby quashed.

HCJ & CPK,J W.A.Nos.167&172 of 2019

However, it is open for the respondent-authorities to initiate

fresh proceedings, if they choose to do so, for acquiring the land.

No order as to costs. As a sequel, W.P.M.Ps. if any shall stand

closed."

2. W.A.No.167 of 2019 is preferred against a judgment and order dated

29.04.2014 passed in W.P.No.24547 of 2006, disposing of the writ petition

in similar terms as in W.P.No.24548 of 2006.

3. Learned counsel for the parties submit that the issue involved in both

the writ petitions is same and for the purpose of disposal of the appeals,

they are relying on the factual matrix as presented in W.P.No.24548 of

2006.

4. The case of the writ petitioner is that the District Collector, Nellore,

had issued a Notification No.RCG5/4109/2006 dated 22.07.2006 for

acquisition of lands for constructing an Industrial Park by the Andhra

Pradesh Industrial Infrastructure Corporation. The Notification included the

writ petitioner's lands admeasuring Ac.4.26 cents in Sy.No.318/1 and

Ac.0.81 cents in Sy.No.331/13-A of Menakur Village, Nayudupet Mandal,

Nellore District. The plea put forward was that public purpose involved in

the Notification is too remote in nature.

5. Mr. J. Ugranarasimha, learned counsel for the appellant, submits

that the learned single Judge, following the decision rendered in Pune

Municipal Corporation(supra), had, in essence, opined that the land

acquisition proceedings had lapsed on account of non-payment of

compensation to the writ petitioners. However, the decision rendered in

Pune Municipal Corporation(supra) was overruled by the Constitution

Bench of the Hon'ble Supreme Court in the case of Indore Development

HCJ & CPK,J W.A.Nos.167&172 of 2019

Authority v. Manoharlal and others, reported in (2020) 8 SCC 129,

and, therefore, the impugned judgment of the learned single Judge cannot

be sustained in law. He has drawn the attention of the Court to paragraphs

231, 232, 365 and 366 of the judgment in Indore Development

Authority(supra) and contends that deemed lapse of land acquisition

proceedings under Section 24(2) of the Right to Fair Compensation and

Transparency in Land Acquisition, Rehabilitation and Resettlement Act,

2013 (for short, 'the Act of 2013') takes place only when an award under

Section 11 of theLand Acquisition Act, 1894 (for short, 'the Act of 1894')

was made five years or more prior to commencement of the Act of 2013

but possession of the land has not been taken and compensation has not

been paid. But, in the instant case, there is no dispute that possession has

been taken and that apart, compensation has also been paid and,

therefore, no purpose will be served by remanding the matter back to the

learned single Judge for fresh consideration. Relying upon the additional

affidavit filed on 19.02.2021 by the appellant,Mr. J.Ugranarasimha stated

that an amount of Rs.87,87,00,000/- was deposited with the District

Collector, Nellore, towards land acquisition/alienation to an extent of

Acs.4556.70, out of which Rs.10,00,00,000/- was deposited vide cheque

dated 02.11.2006, Rs.31,00,00,000/- was deposited vide cheque dated

27.12.2006, Rs.36,40,00,000/- was deposited vide cheque dated

10.01.2007, Rs.5,00,00,000/- was deposited vide cheque dated 13.06.2008,

Rs.3,00,00,000/- was deposited vide cheque dated 10.07.2008 and

Rs.2,47,00,000/- was deposited vide cheque dated 01.09.2009.

6. Mr. Y.V. Ravi Prasad, learned senior counsel assisted by

Ms. A. Anasuya, learned counsel for the respondents/writ petitioners,

conceded that in view of the law laid down by the Hon'ble Supreme Court in

HCJ & CPK,J W.A.Nos.167&172 of 2019

Indore Development Authority(supra), land acquisition proceedings did

not lapse. However, so far as payment of compensation is concerned, it is

contended by him that the writ petitionersare entitled to compensation in

terms of the Act of 2013. He refers to Section 24 of the Act of 2013 and

Section 12 of the Act of 1894. Drawing attention of the Court to the Award

passed, he submits that the writ petitioners had not attended the

proceedings at the time when the Award was passed and in such a

situation, procedure prescribed under Section 12(2) of the Act of 1894 as

well asRule 6 of the Rules for the payment of compensation for land taken

up under the Land Acquisition Act, 1 of 1894 (for short, 'the Rules') has to

be followed, butthe same was not followed. Mr. Y.V. Ravi Prasad has also

drawn the attention of the Court to an Interlocutory Application filed before

the learned single Judge seeking amendment of the writ petition, which is

annexed at Page 8 of I.A.No.1 of 2020 in W.A.No.172 of 2019 filed on

10.09.2020, to contend that the writ petitioner did not receive any notice

and, as such, could not attend the enquiry. He submits that a duty is cast

upon the officer to issue a notice to the persons interested to appear

personally or by a representative, by giving a certain date to receive the

compensation awarded to them. However, in the instant case, no such

notice was issued. He submits that as the revenue deposit was made

without issuing any notice to the writ petitioners, the amount deposited as

revenue deposit cannot be construed as compensation amount in the eye of

law and, therefore, the writ petitionersare entitled to be paid compensation

in terms of the Act of 2013.Referring to the Endorsement dated 02.09.2020

issued by the Revenue Divisional Officer, Naidupet, (available at Page 6 of

additional material papers filed along with I.A.No.1 of 2020 in W.A.No.172

of 2019), wherein it is stated that no details of keeping the award amount

in Revenue Deposits are available in the office records, learned senior

HCJ & CPK,J W.A.Nos.167&172 of 2019

counsel contended that the very fact as to whether any deposit was made

is itself doubtful and, therefore, the matter requires to be remanded back to

the learned single Judge for fresh consideration.

7. Learned Government Pleader for Land Acquisition, on instructions,

submits that sufficient amount is available for making payment to the writ

petitioners in terms of the Award.

8. The Hon'ble Supreme Court in Pune Municipal

Corporation(supra) was considering Section 24 of the Act of 2013.

Section 24 reads as follows:

"24. Land acquisition process under Act No.1 of 1894

shall be deemed to have lapsed in certain cases.- (1)

Notwithstanding anything contained in this Act, in any case of

land acquisition proceedings initiated under the Land Acquisition

Act, 1894 (1 of 1894),-

(a) where no award under section 11 of the said Land

Acquisition Act has been made, then, all provisions of

this Act relating to the determination of

compensation shall apply; or

(b) where an award under said section 11 has been

made, then such proceedings shall continue under

the provisions of the said Land Acquisition Act, as if

the said Act has not been repealed.

(2) Notwithstanding anything contained in sub-section (1), in

case of land acquisition proceedings initiated under the Land

Acquisition Act, 1894 (1 of 1894), where an award under the

said section 11 has been made five years or more prior to the

HCJ & CPK,J W.A.Nos.167&172 of 2019

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 provisos 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."

9. It is appropriate to extract paragraphs 231, 232, 365 and 366 of the

judgment in Indore Development Authority(supra):

231. Rules and the Standing Orders are binding on the

authorities concerned and they have to follow them. They

deposit the amounts in court only when a reference (for higher

compensation) is sought, not otherwise. Even if a person refuses

to accept it and the amount is deposited in court or even it is not

tendered, only higher interest follows under Section 34. Once

Rules have prevailed since long and even if it is assumed that

deposit in court is mandatory on being prevented from payment

as envisaged under Section 31(1), the only liability to make the

payment of higher interest is fastened upon the State. The

liability to pay the amount with interest would subsist. When

amounts are deposited in court, there would occur a procedural

HCJ & CPK,J W.A.Nos.167&172 of 2019

irregularity and the adverse consequence envisaged is under

Section 34 of the 1894 Act. The consequence of non-deposit in

the court is that the amount of the landowner cannot be

invested in the government securities as envisaged under

Sections 32 and 33 of the 1894 Act, in which interest is not more

15%. Thus, no prejudice is caused to the landowners rather they

stand to gain and still payment is safe as it is kept in the court.

We have already held that there is a distinction between the

expression "paid" and "deposited", thus the amount being

deposited as per Rules in the treasury or as per the Standing

Orders considering the scheme of Section 31 read with Section

34 of the 1894 Act, which are in pari materia with Sections 77

and 80 of the 2013 Act. We are of the considered opinion that

acquisition cannot be invalidated, only higher compensation

would follow in case amount has not been deposited with

respect to majority of landholdings, all the beneficiaries would be

entitled for higher compensation as envisaged in the proviso to

Section 24(2).

232. Deposit in treasury in place of deposit in court

causes no prejudice to the landowner or any other stakeholder

as their interest is adequately safeguarded by the provisions

contained in Section 34 of the 1894 Act, as it ensures higher rate

of interest than any other government securities. Their money is

safe and credited in the earmarked quantified amount and can

be made available for disbursement to him/them. There is no

prejudice caused and every infraction of law would not vitiate

the act.

HCJ & CPK,J W.A.Nos.167&172 of 2019

365. Resultantly, the decision rendered in Pune Municipal

Corpn. is hereby overruled and all other decisions in which Pune

Municipal Corpn. has been followed, are also overruled. The

decision in Sree Balaji Nagar Residential Assn. [Sree Balaji Nagar

Residential Assn. v. State of T.N., (2015) 3 SCC 353] cannot be

said to be laying down good law, is overruled and other

decisions following the same are also overruled. In Indore

Development Authority v. Shailendra [(2018) 3 SCC 412], the

aspect with respect to the proviso to Section 24(2) and whether

"or" has to be read as "nor" or as "and" was not placed for

consideration. Therefore, that decision too cannot prevail, in the

light of the discussion in the present judgment.

366. In view of the aforesaid discussion, we answer the

questions as under:

366.1. Under the provisions of Section 24(1)(a) in case

the award is not made as on 1-1-2014, the date of

commencement of the 2013 Act, there is no lapse of

proceedings. Compensation has to be determined under the

provisions of the 2013 Act.

366.2. In case the award has been passed within the

window period of five years excluding the period covered by an

interim order of the court, then proceedings shall continue as

provided under Section 24(1)(b) of the 2013 Act under the 1894

Act as if it has not been repealed.

366.3. The word "or" used in Section 24(2) between

possession and compensation has to be read as "nor" or as

HCJ & CPK,J W.A.Nos.167&172 of 2019

"and". The deemed lapse of land acquisition proceedings under

Section 24(2) of the 2013 Act 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, 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.

366.4. The expression "paid" in the main part of Section

24(2) of the 2013 Act does not include a deposit of

compensation in court. The consequence of non-deposit is

provided in the proviso to Section 24(2) in case it has not been

deposited with respect to majority of landholdings then all

beneficiaries (landowners) as on the date of notification for land

acquisition under Section 4 of the 1894 Act shall be entitled to

compensation in accordance with the provisions of the 2013 Act.

In case the obligation under Section 31 of the Land Acquisition

Act, 1894 has not been fulfilled, interest under Section 34 of the

said Act can be granted. 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 2013 Act has to be

paid to the "landowners" as on the date of notification for land

acquisition under Section 4 of the 1894 Act.

366.5. In case a person has been tendered the

compensation as provided under Section 31(1) of the 1894 Act,

it is not open to him to claim that acquisition has lapsed under

HCJ & CPK,J W.A.Nos.167&172 of 2019

Section 24(2) due to non-payment or non-deposit of

compensation in court. The obligation to pay is complete by

tendering the amount under Section 31(1). The landowners 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 2013 Act.

366.6. The proviso to Section 24(2) of the 2013 Act is to

be treated as part of Section 24(2), not part of Section 24(1)(b).

366.7. The mode of taking possession under the 1894

Act and as contemplated under Section 24(2) is by drawing of

inquest report/memorandum. Once award has been passed on

taking possession under Section 16 of the 1894 Act, the land

vests in State there is no divesting provided under Section 24(2)

of the 2013 Act, as once possession has been taken there is no

lapse under Section 24(2).

366.8. 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 2013 Act came

into force, in a proceeding for land acquisition pending with the

authority concerned as on 1-1-2014. The period of subsistence

of interim orders passed by court has to be excluded in the

computation of five years.

366.9. Section 24(2) of the 2013 Act does not give rise to

new cause of action to question the legality of concluded

proceedings of land acquisition. Section 24 applies to a

HCJ & CPK,J W.A.Nos.167&172 of 2019

proceeding pending on the date of enforcement of the 2013 Act

i.e. 1-1-2014. It does not revive stale and time-barred claims and

does not reopen concluded proceedings nor allow landowners to

question the legality of mode of taking possession to reopen

proceedings or mode of deposit of compensation in the treasury

instead of court to invalidate acquisition."

10. Going by the words and expressions as appearing in Section 24(2) of

the Act of 2013, inPune Municipal Corporation(supra), it was held that

where an award under Section 11 of the Act of 1894 has been made five

years or more prior to the commencement of the Act of 2013, 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 been lapsed.

In other words, in either of the cases, namely, physical possession of the

land not being taken over or the compensation not being paid, deemed

lapse of the land acquisition proceedings will result.

11. In Indore Development Authority(supra), the Hon'ble Supreme

Court held that the word "or" used in Section 24(2) between possession

and compensation has to be read as "nor" or as "and".In other words, only

when possession has not been taken over and compensation has not been

paid, the same would result in deemed lapse of the land acquisition

proceedings.

12. Section 12(2) of the Act of 1894 requires the Collector to give

immediate notice of his award to such of the persons interestedas are not

present personally or by their representatives when the award is

made.Section 31(1) of the Act of 1894 provides that on making an award

under Section 11, the Collector shall tender payment of the compensation

awarded by him to the persons interested/entitled thereto according to the

HCJ & CPK,J W.A.Nos.167&172 of 2019

award, and shall pay it to them unless prevented by some one or more of

the contingencies mentioned in the sub-section (2). Section 31(2) provides

that if the persons entitled do not give consent to receive it, or if there is no

person competent to alienate the land, or if there is 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 of the Act of 1894 would be submitted.

13. Rule 6 of the Rules reads as follows:

"6. In giving notice of the award under Section 12(2)

and tendering payment under Section 31(1) to such of the

persons interested as were not present personally or by their

representatives when the award was made, the officer shall

require them to appear personally or by representatives by a

certain date to receive payment of the compensation

awarded to them intimating also that no interest will be

allowed to them if they fail to appear.If they do not appear

and do not apply for a reference to the civil court under

Section 18, the officer shall, after any further endeavour to

secure their attendance that may seem desirable, cause the

amounts due to be paid in the treasury as revenue deposit

payable to the persons to whom they are respectively due,

and vouched for in the accompanying Form (marked E). The

officer shall also give notice to the payees of such deposits,

specifying the treasury in which the deposits have been

made. In the Collector's accounts the amounts deposited in

the treasury will at once be charged of as public works

expenditure, and when the persons interested under the

HCJ & CPK,J W.A.Nos.167&172 of 2019

award ultimately claim payment the amounts will be paid to

them in the same manner as ordinary revenue deposits. The

officer should, as far as possible, arrange to make the

payments due in or near the village to which the payees

belong in order that the number of undisbursed sums to be

placed in deposit on account of non-attendance may be

reduced to a minimum. Whenever payment is claimed

through a representative, whether before or after deposit of

the amount awarded, such representative must show legal

authority for receiving the compensation on behalf of his

principal."

14. A perusal of the aforesaid Rule goes to show that while giving notice

of the award under Section 12(2) and tendering payment under Section

31(1) to such of the persons interested as were not present personally or

by the representatives when the award was made, the officer shall require

them to appear personally or by representatives by a certain date to receive

payment of the compensation awarded to them, intimating also that no

interest will be allowed to them, if they fail to appear. If they do not appear

and do not apply for a reference to the civil court under Section 18, the

officer shall, after any further endeavour to secure their attendance that

may seem desirable, cause the amounts deposited in the treasury as

revenue deposit payable to the persons to whom they are respectively due,

and vouched for in the accompanying Form.

15. On the basis of the aforesaid Rule, it was contended by Mr. Y.V. Ravi

Prasad that notice as contemplated therein was not given and straight away

the compensation amount was kept in revenue deposit and as such, the

same does not constitute compensation amount.

HCJ & CPK,J W.A.Nos.167&172 of 2019

16. There was no pleading in the writ petition regarding the Collector not

issuing notice under Section 12(2) of the Act of 1894 and Rule 6 of the

Rules. It was sought to be contended by Mr. Y.V. Ravi Prasad that the writ

petition was amended incorporating averments and in paragraph 4 of the

amendment application, reference was made to notice not being issued

under Rule 6 of the Rules. A perusal of the said amendment application

would, however, go to show that though some averments to that extent

were made, amendment was sought for only in the prayer portion.

Amendment that was prayed for reads as follows:

"7. It is submitted that at the time of filing Writ Petition, no

award was passed and as we came to know through the

counter filed by the respondents which was served on

3-12-2012 that the award was passed on 9-1-2007, it is

necessary to question the award by making suitable

amendment in the prayer as given below, in the end of the

prayer after "at Menakuru Village of Nayudupeta Revenue

Mandal, district Nellore" by adding "and to consequentially set

aside the award dated 9-1-2007 passed in Rc.No.A 2685/2006

(Award No. 48/2006-07) by the Sub-Collector's Office, Gudur,"

Hence it is prayed that the Honourable Court may be pleased to

permit the petitioners herein to amend the prayer in the Writ

Petition after "at Menakuru Village of Nayudupeta Revenue

Mandal, district Nellore" by adding "and to consequentially set

aside the award dated 9-1-2007 passed in Rc.No. A 2685/2006

(Award No. 48/2006-07) by the Sub-Collector's Office, Gudur,"

and pass such other order or orders as this Honourable Court

may deem fit and proper."

HCJ & CPK,J W.A.Nos.167&172 of 2019

17. It is not necessary for us to dilate on the aspect of amendment that

was prayed for since it is crystal clear from the Award itself that the

compensation payable for the land was kept in revenue deposit as the writ

petitioner had not attended for award enquiry conducted at Sub-Collector's

office, Gudur, which necessarily and logically would indicate that before

keeping the compensation amount in revenue deposit, no notice was issued

to the writ petitioners.

18. The Hon'ble Supreme Court in Indore Development

Authority(supra) had laid down that acquisition cannot be invalidated and

only higher compensation would follow in case amount has not been

deposited with respect to majority of landholdings, all the beneficiaries

would be entitled for higher compensation as envisaged in the proviso to

Section 24(2) of the Act of 2013. It is not the case of the writ petitioners

that amount had not been deposited with respect to majority of

landholdings. The Hon'ble Supreme Court had also laid down that deposit in

treasury in place of deposit in Court causes no prejudice to the land owner

or any other stakeholder and further held that every infraction of law would

not vitiate the act.

19. Though it is seen that no notice was issued to the writ petitioners