Karnataka High Court
P Muttu S/O P Ponnaswamy vs The State Of Karnataka on 23 February, 2024
Author: N.S.Sanjay Gowda
Bench: N.S.Sanjay Gowda
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NC: 2024:KHC-D:4492
WP No. 85557 of 2013
C/W WP No. 112340 of 2014
IN THE HIGH COURT OF KARNATAKA
AT DHARWAD BENCH
DATED THIS THE 23RD DAY OF FEBRUARY, 2024
BEFORE
THE HON'BLE MR JUSTICE N.S.SANJAY GOWDA
®
WRIT PETITION NO. 85557 OF 2013 (LA-KIADB)
C/W
WRIT PETITION NO. 112340 OF 2014 (LA-KIADB)
IN W.P. NO.85557 OF 2013:
BETWEEN:
DURGAPPA S/O DURGAPPA
CHANNADASAR @ MECHANNAVAR,
AGE. 53 YEARS, OCC. BUSINESS,
R/O. GURUNATH NAGAR,HALE HUBLI-24,
TQ. HUBLI,DIST. DHARWAD.
...PETITIONER
(BY SRI.NANDISH PATIL, ADVOCATE)
Digitally AND:
signed by
KIRAN
KUMAR R
1. THE STATE OF KARNATAKA,
Location:
HIGH R/BY ITS PRINCIPAL SECRETARY,
COURT OF DEPARTMENT OF INDUSTRIES,
KARNATAKA
M.S. BUILDING, DR. AMBEDKAR VEEDHI,
BANGALORE-560001.
2. THE DEPUTY COMMISSIONER,
DHARWAD, DIST. DHARWAD.
3. THE SPECIAL LAND ACQUISITION OFFICER,
KARNATAKA INDUSTRIAL AREA
DEVELOPMENT BOARD,33/A,
LAKMANAHALLI INDUSTRIAL AREA,
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NC: 2024:KHC-D:4492
WP No. 85557 of 2013
C/W WP No. 112340 of 2014
P.B. ROAD, DHARWAD.
...RESPONDENTS
(BY SRI. VIJAY KALSOORMATH, HCGP FOR R1 & R2;
SRI. VEERESH BUDHIHAL, ADVOCATE FOR R3)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO
ISSUE A WRIT IN THE NATURE OF MANDAMUS DIRECTING
RESPONDENT NO.1 TO NO.3 TO CONSIDER THE
REPRESENTATION DTD: 29.07.2008 VIDE ANNEXURE-F AND
DIRECTION MAY BE ISSUED TO PAY COMPENSATION OF
RS.5,91,20,000/- TO THE PETITIONERS, IN THE INTEREST OF
JUSTICE AND EQUITY AND ETC.
IN W.P. NO.112340 OF 2014:
BETWEEN:
1. P. MUTTU S/O P. PONNASWAMY,
AGE. 65 YEARS, OCC. AGRICULTURE,
R/O. SHANTI COLONY, T.B. DAM,
AMARAVATI, HOSPET,
DIST. BELLARY.
2. SMT. O. JAYSLAXMI W/O P. MUTTU,
AGE. 45 YEARS, OCC. AGRICULTURE,
R/O. SHANTI COLONY, T.B. DAM,
AMARAVATI, HOSPET,
DIST. BELLARY.
3. SHAIKH MOHAMMED S/O SHAIKH HUSSAIN SAB,
AGE. 65 YEARS, OCC. AGRICULTURE,
T.B. DAM, MAIN ROAD, AMARAVATI,
HOSPET, DIST. BELLARY.
... PETITIONERS
(BY SRI. NANDISH PATIL, ADVOCATE)
AND:
1. THE STATE OF KARNATAKA,
R/BY ITS SECRETARY,
DEPARTMENT OF INDUSTRY AND COMMERCE,
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NC: 2024:KHC-D:4492
WP No. 85557 of 2013
C/W WP No. 112340 of 2014
M.S. BUILDING,
VIDHANASOUDHA,
BANGALURU.
2. THE DEPUTY COMMISSIONER,
BELLARY, DIST. BELLARY.
3. THE SPL. LAND ACQUISITION OFFICER,
ATTACHED TO KARNATAKA INDUSTRIAL AREA,
DEVELOPMENT BOARD,DHARWAD.
... RESPONDENTS
(BY SRI. VIJAY KALSOORMATH, HCGP FOR R1 & R2;
SRI. VEERESH BUDHIHAL, ADVOCATE FOR R3)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO
ISSUE A WRIT IN THE NATURE OF MANDAMUS DIRECTING
RESPONDENT NO.2 AND NO.3 TO REFER THE APPLICATION OF
THE PETITIONERS VIDE ANNEXURE-P DTD: 23.06.2011 AND
ANNEXURE-Q DTD: 27.09.2011 FOR SEEKING HIGHER
COMPENSATION TO THE COMPETENT CIVIL COURT IN TERMS
OF SECTION.18 OF THE LAND ACQUISITION ACT AND ETC.
THESE PETITIONS HAVING BEEN HEARD AND RESERVED
FOR ORDERS, COMING ON FOR PRONOUNCEMENT, THIS DAY,
THE COURT MADE THE FOLLOWING:
ORDER
1. To facilitate a clearer understanding of this
judgment, this judgment has been indexed as follows.
Sl. Particulars Page No.
NC: 2024:KHC-D:4492
E. Application of law to the present facts 40
A. FACTS:
2. For the sake of convenience, the lands involved
in these writ petitions are referred to as "Dharwad lands"
and the "Ballari lands".
(i) PERTAINING TO DHARWAD LANDS:
3. On 19.08.2006, a Notification under Section
28(1)of the Karnataka Industrial Area Development Act,
1966 (for short "the Act") was published giving notice of
the State Government's intention to acquire about 510
acres of land for the establishment of IT / BT Park. In this
Notification, Block No.63 measuring 6 acres 36 guntas of
NC: 2024:KHC-D:4492
the petitioner was also included.
4. On 06.10.2006, a declaration under Section
28(4) of the Act was also issued by the Government. By
virtue of the publication of the declaration in the Gazette
under Section 28(4) of the Act, as provided under Section
28(5) of the Act, the land stood vested absolutely in the
State Government free from all encumbrances.
5. On 13.11.2007, the petitioner was served with
a notice, in which it was stated that a meeting was to be
convened on 26.11.2007 for the purposes of determination
of the amount of compensation as contemplated under
Section 29(2) of the Act, and that the petitioner was
required to attend the same and render his opinion.
6. On 26.11.2007, the meeting so conducted was
chaired by the Deputy Commissioner, who was
accompanied by the Special Land Acquisition Officer, Joint
Director, another Special Land Acquisition Officer, and
Development Officer of the Karnataka Industrial Area
NC: 2024:KHC-D:4492
Development Board ("KIADB"), apart from the Senior
Sub-Registrar as an invitee and 42 land owners.
7. In this meeting, the land owners were informed
that a sum of Rs.05,21,352/- could be fixed as the price to
be paid for the lands that were sought to be acquired.
8. The petitioner was present and stated that the
market value of the property was Rs.20,00,000/- and
suggested the price to be fixed at said Rs.20,00,000/-.
The relevant record of the proceedings, which are
produced as Annexure-B containing the statement of the
petitioner, reads as follows:
"²æÃ. zÀÄUÀð¥Áà zÀÄUÀð¥Áà ZÀ£ÀßzÁ¸ÀgÀ, ¸Á: vÁjúÁ¼À
EªÀgÀÄ ªÀiÁvÀ£Ár ¸ÀzÀgÀ vÁjúÁ¼À UÁæªÀÄzÀ d«ÄãÀÄUÀ¼ÀÄ
¤ÃgÁªÀj ºÁUÀÆ vÉÆÃlUÁjPÉ d«ÄãÀÄUÀ¼ÁVzÀÄÝ, ¸ÀgÀPÁgÀ¢AzÀ
ªÀÄAdÆgÁzÀ SÁ¸ÀV ¨sÀÆ ªÀiË®åªÀiÁ¥ÀPÀgÀ EªÀgÀ ªÀiË®åªÀiÁ¥À£À
UÀªÀÄ£ÀPÉÌ vÉUÉzÀÄPÉÆAqÀÄ FV£À ªÀiÁgÀÄPÀmÉÖAiÀÄ°è£À ¨É6ÉAiÀÄAvÉ
gÀÆ. 20.00 ®PÀë ¤zsÀðj¸À®Ä ¸À¨sÉUÉ w½¹zÀgÀÄ."
NC: 2024:KHC-D:4492
9. It has also been recorded in the proceedings as
follows:
"EzÀ®èzÉà FUÁUÀ6Éà £ÁªÀÅ w½¹zÀ ¸ÀgÀPÁgÀzÀ
ªÀiÁUÀð¸ÀÆaUÀ¼À ¥ÀæPÁgÀ ªÀiÁrzÀ 6ÉPÁÌZÁgÀUÀ¼ÀÄ F ¨sÁUÀzÀ°è
¥Àæ¸ÀÄÛvÀ £ÀqÉAiÀÄÄwÛgÀĪÀ ªÀåªÀºÁgÀUÀ½UÉ §ºÀ¼ÀµÀÄÖ
ªÀåvÁå¸À«gÀÄvÀÛzÉ. F ¥ÀæzÉñÀzÀ°è ¥Àæw JPÀgÉUÉ gÀÆ.25.30 ®PÀë
UÀ½UÉ ªÀåªÀºÁgÀªÁUÀÄwÛgÀĪÀzÀÄ J®ègÀ C£ÀĨsÀªÀPÉÌ §A¢zÀÄÝ
EgÀÄvÀÛzÉ. DzÀgÉ EzÀPÉÌ ¸ÁPÁëzsÁgÀUÀ¼À£ÀÄß MzÀV¸À®Ä
G¥À£ÉÆÃAzÀt C¢üPÁjUÀ¼À PÀZÉÃjAiÀÄ°è F ªÀåªÀºÁgÀ
¸ÀjAiÀiÁV £ÉÆÃAzÀ DVgÀĪÀ¢®è. DzÀÝjAzÀ £ÀªÀÄUÉ 2004-05
£Éà ¸Á°£À°è UÁªÀÄ£ÀUÀnÖ UÁæªÀÄzÀ°è DzÀ d«Ää£À ªÀåªÀºÁgÀ
Cwà ºÉZÀÄÑ CAzÀgÉ ¥Àæw JPÀgÉUÉgÀÆ. 5,50,000-00 EgÀÄvÀÛzÉ.
EzÀ£ÀÄß DzsÀj¹, EzÀPÉÌ ±Á¸À£À§zÀÞ ¸Ë®¨sÀåUÀ¼À£ÀÄß ¤Ãr
CzÀQÌAvÀ ºÉaÑ£À ¨sÀÆ¥ÀjºÁgÀ ¤UÀ¢¥Àr¹zÀ°è ªÀiÁvÀæ £ÀªÀÄUÉ
C£ÀÄPÀÆ®ªÁUÀĪÀzÉAzÀÄ ªÀÄvÀÄÛ EzÉà jÃw ¨sÀÆ¥ÀjºÁgÀ
¤UÀ¢¥Àr¸À®Ä PÀæªÀÄ PÉÊPÉƼÀî¨ÉÃPÉAzÀÄ MvÁ۬ĹzÀgÀÄ."
10. This would indicate that the farmers had not
agreed for a sum of Rs.05,50,000/- and were demanding
Rupees 25 to 30 lakhs. The proceedings also record the
following:
"gÉÊvÀgÀ ¨ÉÃrPÉUÀ¼À£ÀÄß ºÁUÀÆ UÀȺÀ ªÀÄAqÀ½AiÀĪÀgÄÀ ¤ÃrzÀ ¸À£ï
2006-07£Éà ¸Á°£À zÀgÀ gÀÆ.6,90,000-00 ºÁUÀÆ 2004-05 £ÉÃ
NC: 2024:KHC-D:4492
¸Á°£À°è DzÀ £ÉÆÃAzÀ £ÉÆÃqÀ¯ÁV ªÀÄvÀÄÛ ªÁ¸ÀÛ«PÀªÁV ¸ÀzÀgÀ
d«ÄãÀÄ PÉÊUÁjPÉUÉ CªÀ±Àå«zÀÄÝ, ªÀĺÁ£ÀUÀgÀ ¥Á°PÉAiÀÄ wÃgÀ
ºÀwÛgÀzÀ°èzÀÄÝ, ºÉaÑ£À ¨É¯ÉAiÀÄ ¸ÁªÀÄxÀåðªÀ£ÀÄß ºÉÆA¢gÀĪÀ
CA±ÀªÀ£ÀÄß ¥ÀjUÀt¹ UÁªÀÄ£ÀUÀnÖ£À UÁæªÀÄzÀ°è ¸À£ï 2004-05£ÉÃ
¸Á°£À°è DzÀ d«Ää£À ªÀåªÀºÁgÀ Cwà ºÉZÀÄÑ CAzÀgÉ
gÀÆ,5,50,000-00 ¥Àæw JPÀgÉUÉ EzÀ£ÀÄß ¥ÀjUÀt¹ EzÀPÉÌ ±ÉÃ.30 £ÀµÀÖ
¨sÀwð, ±ÉÃ.12 ºÉZÀÄѪÀj ªÀiÁgÀÄPÀmÉÖ ¨É¯É ºÁUÀÆ ±ÉÃ.20 ºÉZÀÄѪÀj
¥ÀjºÁgÀ ¸ÉÃjzÀgÉ CzÀgÀ ¨É¯ÉAiÀÄÄ gÀÆ.8,91,000-00 DUÀÄvÀÛzÉ.
EzÀ£ÀÄß ªÀÄÄA¢£À ºÀvÀÄÛ ¸Á«gÀPÉÌ ºÉÆA¢¹zÁUÀ gÀÆ.9,00,000-00
¥Àæw JPÀgÉUÉ ¨É¯É ¤ÃqÀ®Ä ¤zsÀðj¸À¯Á¬ÄvÀÄ gÀÆ.9,00,000-00
EzÀÄ ¥Àæw JPÀgÉUÉ d«Ä¤£À ¨É¯É DVzÀÄÝ, EvÀgÀ ªÀiË®åUÀ½UÉ
¸ÀA§AzsÀ¥ÀlÖ C¢üPÁjUÀ½AzÀ ªÀiË®åªÀiÁ¥À£À ªÀgÀ¢ ¥ÀqÉzÀÄ D
¥ÀæPÁgÀ ¥ÀjºÁgÀ ¥ÁªÀw¸À®Ä PÀæªÀÄ PÉÊPÉƼÀÄîªÀAvÉ w½¹zÀgÀÄ."
11. Thus, the KIADB officials were of the view that
the highest sale consideration in respect of the
neighbouring lands was Rs.05,50,000/- and to this - 30%
solatium, a further 12% additional market value and,
lastly, 20% additional compensation (a sum of
Rs.8,91,000/-) would be the ideal sum, and the figure can
be rounded-off to Rs.09,00,000/- per acre, which could be
paid as compensation.
NC: 2024:KHC-D:4492
12. Ultimately, it was recorded in the meeting as
follows:
"PÉÆ£ÉAiÀÄ°è vÁjúÁ¼À ºÁUÀÆ UÁªÀÄ£ÀUÀnÖ UÁæªÀÄUÀ¼À
¨sÀƸÁé¢üãÀ¥Àr¹zÀ d«ÄãÀÄUÀ½UÉ ¥ÀæwJPÀgÉUÉgÀÆ. 9,00,000-
00 CAvÁ ¨sÀÆ ¨É6É ¤zsÀðj¹ ¸ÀzÀgÀ ¤UÀ¢¥Àr¸À®àlÖ
¨sÀÆ¥ÀjºÁgÀªÀÅ ¸ÀgÁ¸Àj ¨É6ÉAiÀÄ ªÀÄÆgÀÄ ¥ÀnÖVAvÀ ºÉaÑUÉ
EgÀĪÀzÀjAzÀ EzÀPÉÌ PÉ.L.J.r.©. ªÀÄAqÀ½AiÀÄ C£ÀĪÉÆÃzÀ£É
¥ÀqÉAiÀÄĪÀzÀÄ CªÀ±Àå«gÀÄvÀÛzÉ CAvÁ ªÀiÁ£Àå CzsÀåPÀëgÀÄ ¸À¨sÉAiÀÄ°è
CAwªÀĪÁV WÉÆö¹zÀgÀÄ."
13. The proceedings of this meeting thus indicates
that the farmers were demanding Rupees 25 to 30 lakhs
and the Price Determination Committee headed by the
Deputy Commissioner, ultimately, declared that a sum of
Rs.09,00,000/- was optimal, for which approval was
however necessary from the KIADB.
14. Notwithstanding this determination of
Rs.09,00,000/- per acre, on 16.06.2008 i.e., about seven
months after the meeting, the petitioner was served with a
notice stating that the KIADB had fixed a sum of
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NC: 2024:KHC-D:4492
Rs.13,36,000/- per acre for the purpose of compensation,
as contemplated under Section29(2) of the Act.
15. Thus, the Board increased its initial
determination of Rs.09,00,000/- per acre to
Rs.13,36,000/- per acre after 7 months. The reason for
this increase was however not forthcoming in the notice.
Nonetheless, in the objection to the writ petition, it is
stated as follows:
"3. It is submitted that, the compensation
amount to the acquired land has been fixed at
Rs.9,00,000/- per acre under Section 29(2) of KIAD
Act under the presence of 2nd respondent as per
Annexure-B of the petition. The acquired land
owners are demanded more compensation amount
to enter agreement under Section 29(2) of KIAD
Act, therefore the Head Office of the 3rd Respondent
finally decided to give compensation at
Rs.13,36,000/- per acre. The notice was issued
accordingly to the petitioner to receive the
compensation under Section 29(2) of the KIAD Act
on 16-06-2008 as per Annexure-E of the petition."
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NC: 2024:KHC-D:4492
16. It would therefore appear from the stand of the
KIADB that since the land owners had demanded more
than Rs.09,00,000/- per acre as compensation to enter
into an agreement under Section 19 of the Act, the Head
office of the Board had decided to give a compensation of
Rs.13,36,000/- per acre.
17. It appears that on the very same day i.e., on
16.06.2008, possession of the petitioner's land was also
taken over by the KIADB.
18. The petitioner, thereafter, addressed a letter
dated 29.07.2008stating as follows:
"PÁgÀt, vÁªÀÅ ¥Àæw UÀÄAoÉUÉ 1 ®PÀë 20,000 ¸Á«gÀ gÀÆ.UÀ¼ÀAvÉ
¨É¯É ¤UÀ¢UÉƽ¹ MlÄÖ gÀÆ¥Á¬ÄUÀ¼ÀÄ, 3,13,20,000-00 £À£ÀUÉ vÁªÀÅ
d«Ää£À ¨É¯É ¤ÃqÀ¨ÉÃPÀÄ. CAzÀgÉ £À£Àß M¦àUÉ EzÉ. KPÉAzÀgÉ FV£À
¸ÀzÀåzÀ ªÀiÁPÉðmï ¨É¯É »ÃUÉAiÉÄà EzÉ. ¸ÉÌ÷éÃgï¥sÀÆmï ¯ÉPÀÌzÀ°è ¨É¯É
¤zsÀðj¹ ¥Àæw UÀÄAoÉUÉ 1 ®PÀë 20,000 ¸Á«gÀ gÀÆ¥Á¬ÄUÀ¼ÀAvÉ ¨É¯É
¤UÀ¢¥Àr¹ £À£ÀUÉ ¤ÃrzÀgÉ £À£Àß M¦àUÉ EzÉ. C®èzÉ F d«Ää£À°è
¸ÁPÀµÀÄÖ ¨É¯É¨Á¼ÀĪÀ VqÀ, ªÀÄgÀUÀ¼ÀÄ EzÀÄÝ 1 PÉÆÃn 50 ®PÀëPÀÆÌ ºÉaÑUÉ
¨É¯É¨Á¼ÀĪÀ VqÀªÀÄgÀUÀ½ªÉ. F ¨É¯ÉAiÀÄ£ÀÄß £À£ÀUÉ ¤ÃrzÀgÉ ªÀiÁvÀæ £À£Àß
M¦àUÉ EzÉ.
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NC: 2024:KHC-D:4492
ªÀÄvÀÄÛ EzÉ d«Ää£À°è C£ÉÃPÀ ¨É¯É¨Á¼ÀĪÀ PÀlÖqÀUÀ¼ÀÄ, PÉgÉ, gÀ¸ÉÛ
EªÉ EªÀÅUÀ¼À ¨É¯É MAzÀÄ PÉÆÃn 28 ®PÀë gÀÆ¥Á¬ÄUÀ¼ÀÄ DUÀÄvÀÛzÉ.
EzÀ£Éß®è ¸ÉÃj MlÄÖ gÀÆ¥Á¬Ä 5 PÉÆÃn 91 ®PÀë 20 ¸Á«gÀ
gÀÆ¥Á¬ÄUÀ¼À£ÀÄß £À£ÀUÉ £ÁåAiÀÄAiÀÄÄvÀªÁzÀ ¥ÀjºÁgÀ ºÀt ¤ÃrzÀgÉ £À£Àß
M¦àUÉ EzÉ, E®è¢zÀÝgÉ PÀ®A 29(2)gÀ ¥ÀæPÁgÀ M¥ÀàAzÀPÉÌ £À£Àß vÀPÀgÁgÀÄ
EzÉ. F ªÉÆzÀ®Ä EzÀPÉÌ £À£Àß M¦àUÉAiÀÄ£ÀÄß ¸ÀºÀ ¤Ãr®è.
ªÀiÁ£ÀågÀÄ, ªÉÄïÁÌt¹zÀ J®è «µÀAiÀÄUÀ¼À£ÀÄß ¥ÀjUÀt¹
£ÁåAiÀÄAiÀÄÄvÀªÁV £À£ÀUÉ §gÀ¨ÉÃPÁzÀ ¥ÀjºÁgÀ zsÀ£À MlÄÖ 5 PÉÆÃn 91
®PÀë 20 ¸Á«gÀ gÀÆ¥Á¬ÄUÀ¼À£ÀÄß £À£ÀUÉ ¤Ãr £À£Àß d«ÄãÀ£ÀÄß
¸Áé¢üãÀ¥Àr¹PÉƼÀî°PÉÌ £À£Àß M¦àUÉ EzÉ. ªÉÄïÁÌt¹zÀ ¥ÀjºÁgÀ ºÀt
gÀÆ¥Á¬Ä 5 PÉÆÃn 91 ®PÀë 20 ¸Á«gÀUÀ¼À£ÀÄß ¤ÃqÀ¢zÀÝgÉ £À£Àß M¦àUÉ
E®èªÉAzÀÄ vÀªÀÄUÉ w½¸À®Ä §AiÀĸÀÄvÉÛãÉ."
19. It is thus clear that in response to the notice
dated 16.06.2008, the petitioner categorically stated that
a sum of Rs.13,36,000/- was unacceptable to him and he
demanded a total sum of Rs.05,91,20,000/-as
compensation for the acquired lands and he also stated
that only if the said sum was given, he was prepared to
act in accordance with Section 29(2) of the Act.
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20. The record that is produced indicates that on
06.05.2009, an affidavit of the petitioner was given to the
officials of the Board, in which he stated that there were
no litigations in respect of the lands before any Court and
he had not taken any compensation for his lands from any
other authorities.
21. It may be pertinent to state here that the
original records that are produced before the Court
relating to the Dharwad lands do not indicate that there
was any communication or correspondence between the
petitioner and the Board or its officials from July, 2008 to
May, 2009 regarding the determination of the sum of
Rs.13.36 lakhs per acre, which was ultimately offered by
the Board; or regarding any offer or counter offer
regarding the compensation payable for the lands.
22. In other words, there is nothing in the file
between 16.06.2008 (the date on which the offer for
payment of Rs.13.36 lakhs per acre was made) and
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NC: 2024:KHC-D:4492
06.05.2009 (the day on which the above-mentioned
affidavit was filed), which indicates that there were any
kind of deliberations regarding the compensation that was
to be paid for the acquired lands.
23. The file also contains a letter dated 14.05.2009,
in which the petitioner has stated that he was agreeable
for the offer of Rs.13,36,000/-made to him by the letter
dated 16.06.2008, and that he was willing to accept a sum
of Rs.87,17,400/- for the land, Rs.82,32,585/- for the
structures and Rs.84,000/- for the trees, and that the
same may be paid to him immediately.
24. It may be pertinent to note here that the notice
of the Board to the effect that it was willing to pay
Rs.13,36,000/- was made on 16.06.2008, and for nearly a
year thereafter (till 06.05.2009), nothing transpired
between the petitioner and the respondent in the matter of
compensation, but, nevertheless, a letter has been
submitted by the petitioner on 14.05.2009, whereby the
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NC: 2024:KHC-D:4492
petitioner accepted a sum of Rs.13,36,000/- per acre,
apart from Rs.82,32,585/- towards the cost of the
building.
25. Thereafter, on 10.06.2009, the petitioner has
executed an agreement and also an indemnity bond in
favour of the KIADB and also received the compensation
amount of Rs.83,16,600/- (after deduction of tax on
10.06.2009, being the value of the land).
26. The petitioner has also submitted a protest
letter, dated 23.11.2009 (Annexure-H) stating that he had
not received the compensation for the structures and for
the trees, and if the amount was not paid, he would
undertake a fast unto death.
27. As per the statement of objections, the
petitioner was paid a further sum of Rs.80,60,988/- (after
deducting tax from the total compensation of Rs.83,16,600/- in
respect of the structures and malki on 23.03.2010).
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28. Thus, in respect of the land for which
possession was taken in June, 2008, the petitioner was
ultimately paid compensation at the rate offered by the
Board, only on 10.06.2009 and for the structures on
23.03.2010.
29. The petitioner has filed this petition seeking a
direction to the KIADB to consider his representation,
dated 29.07.2008, whereby he had sought payment of
compensation of Rs.5,91,20,000/-, and alternatively, a
direction is sought to be issued to the 1strespondent to
refer the matter to the Deputy Commissioner to determine
the compensation in terms of the representation dated
29.07.2008, and lastly, a prayer is made to declare that
the agreements and indemnity bond executed by the
petitioner are not agreements in terms of Section 29(2) of
the Act and that the same are void and unenforceable
against the petitioner.
- 17 -
NC: 2024:KHC-D:4492
(ii) PERTAINING TO BALLARI LANDS:
30. On 07.10.2009, the State Government issued a
Notification under Section 28(1) stating its intention to
acquire 42 acres 77 guntas of land for the purposes of
establishing a Truck Terminal. The lands of the petitioners
were also included in said Notification.
31. On 27.05.2010 a declaration under Section
28(4) of the Act was published in the Gazette by the State
Government and by virtue of said publication, the lands
stood vested absolutely in the State Government, free
from all encumbrances.
32. It is stated that writ petitions were filed by the
petitioner challenging the acquisition along with others in
W.P. No.65554-58/2010, and by oversight, the petition
filed by the petitioners was also dismissed as withdrawn,
though only two of the petitioners had sought withdrawal.
It is stated that the petitioners had preferred an
- 18 -
NC: 2024:KHC-D:4492
application seeking recall of said order and the application
was allowed, indicating that only WP 65557-58/2010 were
dismissed as being withdrawn, and the writ petitions of the
petitioners were restored.
33. On 13.08.2010, the petitioners were served
with a notice stating that a meeting was to be convened,
headed by the Deputy Commissioner (Ballari), Special
Land Acquisition Officer (Dharwad), Joint Director (District
Industries Department), Development Officer (KIADB) and
the Managing Director of the D.Devaraj Urs Truck Terminal
were present along with the landowners to determine the
value of the lands by the Land Value Determination
Advisory Committee, and the petitioners were required to
appear and render their opinion.
34. On 29.09.2010, the meeting of the Committee
was held and in the same, one of the petitioners i.e., the
first petitioner (who is the husband of the second petitioner)
stated that in respect of a neighbouring lands, an extent of
- 19 -
NC: 2024:KHC-D:4492
37 guntas of non-agricultural land had been sold for
Rupees One Crore and he also produced the sale deed of
that particular land to state that the value of their land
should also be fixed on the same terms.
35. The petitioners also requested that the
acquisition proceedings be dropped. It was also requested
by the petitioners that instead of compensation, they
should be given the same extent of developed lands since
the petitioners were growing sugarcane crop and were
earning about Rupees Twenty Lakhs every year. It was
also stated that they were entitled to a sum of Rs.1,000/-
to Rs.2,000/- per sq. ft., failing which the Truck Terminal
should be established elsewhere.
36. The records of the proceedings indicate the
following were the deliberations between the Deputy
Commissioner and the land owners:
"f6Áè¢üPÁjUÀ¼ÀÄ, »jAiÀÄ G¥À£ÉÆAzÀt C¢üPÁjUÀ½AzÀ
CªÀÄgÁªÀw UÁæªÀÄzÀ°è ©£ï ±ÉÃwÌ d«Ää£À ªÀiÁUÀð¸ÀÆa ¨É6É
- 20 -
NC: 2024:KHC-D:4492
gÀÆ. 180/- ¥Àæw ZÀzÀgÀ CrUÉ EgÀÄvÀÛzÉ JA§ÄzÀ£ÀÄß
w½zÀÄPÉÆAqÀgÀÄ gÀÆ. 1.00 PÉÆÃnUÉ ªÀiÁgÁlªÁzÀzÀÄÝ MAzÀÄ
DPÀ¹äPÀ (stray case) ¥ÀæPÀgÀtªÁVgÀ §ºÀÄzÁVzÉAiÀiÁzÀÝjAzÀ
CzÀ£Éßà ¨É6É ¤UÀ¢¥Àr¸À®Ä ¥ÀjUÀt¸ÀĪÀÅzÀÄ
¸ÀªÀÄAd¸ÀªÉ¤¸À6ÁgÀzÀÄ. DzÀgÉ ¨sÀÆ ªÀiÁ®PÀgÀÄ EzÀĪÀgÉUÀÆ
¤ÃrzÀ C©ü¥ÁæAiÀÄzÀ ¥ÀæPÁgÀ ¸ÀzÀgÀ d«ÄãÀÄUÀ¼À ¸ÀÄvÀÄÛ-ªÀÄÄvÀÛ°£À
¥ÀæzÉñÀªÀÅ C©üªÀÈ¢Þ ºÉÆA¢zÀÄÝ F d«ÄãÀÄUÀ¼ÀÆ ¸ÀºÀ ©£ï ±ÉÃwÌ
¸ÁªÀÄxÀåðªÀ£ÀÄß ºÉÆA¢ªÉ JA§ CA±ÀªÀ£ÀÄß M¥À৺ÀÄzÁVzÉ.
¨sÀƪÀiÁ°PÀgÀ PÉÆÃjPÉAiÀÄAvÉ d«ÄãÀ£ÀÄß ¸ÀgÀPÁgÀzÀ ¥ÀgÀªÁV
Rjâ¹ ¨sÀƪÀiÁ®PÀjUÉ PÉÆqÀĪÀAvÀºÀ ¤AiÀĪÀÄUÀ¼ÀÄ EgÀĪÀÅ¢®è.
EzÀĪÀgÉUÀÆ ¨sÀƪÀiÁ®PÀgÀÄ ¤ÃrzÀ C©ü¥ÁæAiÀÄUÀ¼ÀÄ ªÀÄvÀÄÛ
G¥À£ÉÆAzÀt C¢üPÁjUÀ¼À ªÀgÀ¢AiÀÄ£ÁßzsÀj¹ ¸À«ÄwAiÀÄÄ
©£ï±ÉÃwÌ ªÀiÁUÀð¸ÀÆa ¨É6É ¥ÀæPÁgÀ C©üªÀÈ¢ÞPÉëÃvÀæ ºÉÆgÀvÀÄ¥Àr¹
¥Àæw JPÀgÉ d«Ää£À ¨É6É gÀÆ. 43,12,440/- DUÀÄvÀÛzÉ. CzÀgÀ°è
C©üªÀÈ¢ÞUÁV vÀÄA§¨ÉÃPÁzÀ ªÉZÀÑ gÀÆ. 18.00 ®PÀë
PÀrvÀUÉƽ¹zÀgÉ ¥Àæw JPÀgÉUÉ gÀÆ. 25.00 ®PÀë ¨sÀƨÉ6É
¤UÀ¢¥Àr¸ÀĪÀÅzÀÄ ¸ÀÆPÀÛªÉAzÀÄ C©ü¥ÁæAiÀÄ¥ÀqÀÄvÀÛzÉ.
EzÀPÉÌ ¸À¨sÉAiÀÄ°è ºÁdjzÀÝ ¨sÀƪÀiÁ®PÀgÀÄ vÁªÀÅUÀ¼ÀÄ
M¼ÉîAiÀÄ ¥sÀ®ªÀvÁÛzÀ ¥Àæw ªÀµÀðPÉÌ ¸ÀĪÀiÁgÀÄ 2.00 ®PÀë GvÀà£Àß
§gÀĪÀ ºÁUÀÆ C©üªÀÈ¢Þ¥Àr¹zÀ d«ÄãÀÄUÀ½UÉ ºÉÆA¢PÉÆArgÀĪÀ
©£ï ±ÉÃw ¸ÁªÀÄxÀåðªÀżÀî d«ÄãÀ£ÀÄß ¸ÁªÀðd¤PÀ GzÉÝñÀPÁÌV
CAzÀgÉ læPï l«Äð£À6ï ¤ªÀiÁðtPÁÌV ©lÄÖ PÉÆqÀÄwÛzÉÝêÉ.
PÁgÀt vÀªÀÄUÉ E£ÀÆß ¸Àé®à ¨sÀÆ¥ÀjºÁgÀªÀ£ÀÄß ºÉaѹPÉÆlÖ°è vÁªÀÅ
M¥ÀàAzÀPÉÌ §gÀĪÀÅzÁV w½¹zÀgÀÄ. F CA±ÀUÀ¼À£ÀÄß ¥ÀjUÀt¹
¸À«ÄwAiÀÄÄ ¸ÀzÀgÀ ¥ÀæPÀgÀtzÀ°è ¨sÀÆ¥ÀjºÁgÀªÀ£ÀÄß ¥Àæw JPÀgÉUÉ gÀÆ.
30.00 ®PÀëgÀÆ CAvÁ wêÀiÁð¤¹vÀÄ.
- 21 -
NC: 2024:KHC-D:4492
CzsÀåPÀëgÀÄ F ¥ÀæPÀgÀtzÀ°è M¼ÀUÉÆAqÀ d«ÄãÀÄUÀ½UÉ ¨sÀÆ
¨É6É ¤zsÀðgÀuÁ ¸À®ºÁ ¸À«Äw ¸À¨sÉAiÀÄÄ M¥ÀàAzÀzÀ ¥ÀæPÁgÀ ¥Àæw
JPÀgÉUÉgÀÆ. 30.00 ®PÀëzÀgÀ ¤UÀ¢¥Àr¹gÀĪÀÅzÀ£ÀÄß WÉÆö¹zÀgÀÄ.
¸À¨sÉAiÀÄ°è G¥À¹ÜvÀjzÀÝ gÉÊvÀgÀÄ F ¨sÀƨÉ6ÉAiÀÄ£ÀÄß
M¥ÀÅàªÀÅzÁV ¸À¨sÉUÉ w½¹zÀgÀÄ. PÉÆ£ÉAiÀÄ°è ªÀAzÀ£Á¥ÀðuÉAiÉÆA¢UÉ
¸À¨sÉAiÀÄÄ ªÀÄÄPÁÛAiÀÄUÉÆArvÀÄ."
37. It is thus clear that the Deputy Commissioner
suggested Rs.25,00,000/- per acre and the land owners
who were present were asking for a little more.
Accordingly, a sum of Rs.30,00,000/- was fixed.
38. The petitioners thereafter received a notice
dated 06.05.2011 stating that the KIADB was willing to
pay a sum of Rs.30,00,000/- per acre for 6 acres of land.
39. In response, the petitioners, by their letter
dated 23.06.2011, stated that they were not agreeable for
said sum of Rs.30,00,000/- and demanded for payment of
Rupees One Crore per acre to agree for the acquisition.
- 22 -
NC: 2024:KHC-D:4492
40. More than 15 months after the offer of Rs.
30,00,000/- lakhs was made and the response of the
petitioners for payment of Rs. 1 crore was received, on
02.08.2012, the petitioners have executed the agreement
and indemnity bonds agreeing to receive the
compensation at the rate of Rs.30,00,000/- per acre.
41. The petitioners have thereafter filed this
petition seeking a writ of mandamus to direct the State
Government to refer the applications of the petitioners
dated 23.06.2011 and 27.09.2010 to the competent Civil
Court in terms of Section 18 of the Land Acquisition Act. A
declaration is also sought that the agreements and
indemnity bonds executed by them are invalid and
inoperative, and that they do not take away the rights of
the petitioners to seek a higher compensation.
42. To summarise, in both these cases, the Board in
a meeting had resolved to pay a sum of Rs.09,00,000/-
and Rs.30,00,000/- (respectively) per acre and both
petitioners had refused this offer, but, subsequently, about
- 23 -
NC: 2024:KHC-D:4492
a year after the meeting, they have proceeded to enter
into agreements consenting to receive the sums fixed by
the Price Determination Advisory Committee.
B. CONTENTIONS ADVANCED:
43. The petitioners contend that they cannot be
bound by their agreements and the acceptance of the
amounts under the agreements would not deprive them of
their right to seek higher compensation. It is also stated
that the petitioners were forced to accept the
compensation, since they had lost possession of their
lands and yet, were not paid any compensation for more
than a year, and in that context, their execution of the
agreement or acceptance of compensation would not estop
them from seeking a higher compensation.
44. On the other hand, the Board contends that the
petitioners voluntarily entered into agreements, whereby
they accepted the price determined by the Committee at
- 24 -
NC: 2024:KHC-D:4492
Rs.13,36,000/- & Rs.30,00,000/- per acre and they are
now estopped from seeking a higher compensation.
45. It is submitted that once the land-loser had
agreed for a particular sum as compensation and had also
executed agreements and indemnity bonds, it would be
impermissible for them to then resile from the agreements
and demand a higher compensation. It is also contended
that the writ petitions had been filed after the petitioners
had received the amount of compensation and, therefore,
the petitions itself would not be maintainable as the
petitioners cannot be permitted to approbate and
reprobate.
C. ISSUES:
46. Considering the above, the issues in these writ
petitions are as below:
i. Whether the amounts determined as
compensation and paid to the land-losers
could be considered in this case as the
- 25 -
NC: 2024:KHC-D:4492
amount of compensation that had been
determined by agreement as
contemplated under Section 29(2) of the
KIAD Act; and
ii. Whether the petitioners are estopped from
demanding a higher compensation after
they have executed the agreements and
the indemnity bonds.
D.ANALYSIS OF RELEVANT LEGAL PROVISIONS:
47. In order to examine the contentions and arrive
at a conclusion, it would be necessary to provide a brief
overview of the statutory provisions in relation to the
compensation payable under the Act with specific
reference to the phrase "where the amount of
compensation has been determined by agreement" found
in Section 29(2) of the Act.
- 26 -
NC: 2024:KHC-D:4492
48. The KIAD Act is an enactment which provides
for securing the establishment of industrial areas, to
promote the establishment and orderly development of
industries in the State, and for this purpose, establish a
Board. The functions of Board, as stipulated in the Act, is
to promote and assist the rapid and orderly establishment
growth and development of industries, and to provide
industrial infrastructural facilities and amenities in
industrial areas, apart from establishing, maintaining,
developing and managing the industrial estates within the
industrial areas. The State is also tasked with developing
industrial areas declared by the State Government and
make them available for undertakings to establish
themselves.
49. In order to achieve this objective, the Board has
been conferred with the power to acquire and to hold the
property and it has also been empowered to lease, sell or
exchange or otherwise transfer any property held by it.
The Board is also empowered to purchase by agreement or
- 27 -
NC: 2024:KHC-D:4492
take on lease or under any form of tenancy any land to
erect buildings and to execute such other works as may be
necessary.
50. Chapter - VII of the Act provides for Acquisition
and Disposal of Land by the Board. Chapter VII states that
it can be made applicable only from the date on which the
industrial area is declared under Section 1(3) of the Act.
51. Section 28 of Chapter - VII requires the State
Government to publish a notification giving notice of its
intention to acquire such lands, and on publication of the
notification, notices are required to be served on the
owner or on the occupier of the land(s) to show-cause as
to why the lands should not be acquired. The provision
also stipulates that after considering the cause shown by
the owner or any other interested person and after hearing
them, the State Government is empowered to pass such
orders as it deems fit.
52. The provision also stipulates that if the
Government is satisfied that any land should be acquired
- 28 -
NC: 2024:KHC-D:4492
for the purpose specified in the notification, a declaration
would have to be issued, and on such declaration being
published in the Gazette, such land would stand vested
absolutely in the State Government, free from all
encumbrances. The State would then possess the power to
call upon the person in possession to surrender possession
and if he fails to do so, the State could take possession
with such force as may be necessary.
53. Ultimately, the provision states that when the
land has been acquired for the Board, the State
Government, after it has taken possession of the land,
could transfer the possession to the Board for the purpose
for which the land had been acquired.
54. Section 291 of the Act provides for
Compensation. Sub-section (1) of Section 29 clearly states
29. Compensation.- (1) Where any land is acquired by the State Government under this
Chapter, the State Government shall pay for such acquisition compensation in accordance with
the provisions of this Act. (2) Where the amount of compensation has been determined by
agreement between the State Government and the person to be compensated, it shall be paid
in accordance with such agreement. (3) Where no such agreement can be reached, the State
Government shall refer the case to the Deputy Commissioner for determination of the amount
of compensation to be paid for such acquisition as also the person or persons to whom such
compensation shall be paid. (4) On receipt of a reference under sub-section (3), the Deputy
Commissioner shall serve notice on the owner or occupier of such land and on all persons
known or believed to be interested herein to appear before him and state their respective
interests in the said land.
- 29 -
NC: 2024:KHC-D:4492
that where any land is acquired by the State under
Chapter - VII, it would be bound to pay for such
acquisition the compensation determined in accordance
with provisions of this Act.
55. Sub-section (2) of Section 29 of the Act, with
which we are mainly concerned in these writ petitions,
states that "if the amount of compensation has been
determined by agreement between the State Government
and the person to be compensated" it shall be paid in
accordance with such agreement.
56. Sub-section (3) of Section 29 states that if no
agreement can be reached, the State Government should
refer the case to the Deputy Commissioner for
determination of the amount of compensation to be paid
for such acquisition as also to the person or persons to
whom such compensation shall be paid. The Deputy
Commissioner, on receipt of a reference, is required to
serve notice on the owner or occupier of the land and call
upon them to state their respective interests.
- 30 -
NC: 2024:KHC-D:4492
57. To summarise, Section 29 contemplates that
the State Government is required to pay compensation for
the acquired lands and if the amount of compensation has
been determined by agreement, the same shall be paid in
accordance with such agreement; and if there is no such
agreement, the State is required to refer the case to the
Deputy Commissioner for determination of the amount of
compensation to be paid.
58. Section 30 of the Act, before its amendment in
2022, provided for the applicability of the provisions of the
Land Acquisition Act, 1894 for the purposes of determining
the compensation, but subsequently in the year 2022,
Section 30 was amended and a new provision was
substituted, by which Sections 23, 23A, 26-30, 64, 65, 69,
72-80, 96,and Schedule I of the Central Act 30 of 2013
were deemed to be a part of KIAD Act, 1966 as if they
were reenacted in the body in respect of lands acquired
under Chapter - VII of the Act.
- 31 -
NC: 2024:KHC-D:4492
59. Section 31 of Chapter - VII provides for
delegation of powers by the State Government (as
available to it under Chapter - VII)to any of its officers, by
the Rules made in that behalf.
60. In exercise of the powers conferred under
Section 41 of the Act, the Karnataka Industrial Areas
Development Rules, 1966 ("the Rules") have been
framed. Rule 14 of said Rules states that the power of the
State Government under sub-sections (2), (3), (6), (7) &
(8) of Section 28 and sub-sections (1), (2) & (3) of
Section 29 were delegated to the Assistant Commissioner
in charge of the Revenue Sub-Division within their
respective jurisdiction or to the Special Land Acquisition
Officers or the Additional Special Land Acquisition Officers
in the Board with such jurisdiction as the State
Government would specify.
61. In other words, by virtue of Rule 14 of the
Rules, whenever the term "State Government" is referred
to in Sections 28 and 29 of the Act, it would essentially
- 32 -
NC: 2024:KHC-D:4492
mean that it is the Assistant Commissioner in charge of
the Revenue Sub-Division or the Special Land Acquisition
Officer or Additional Land Acquisition Officer or the Board.
62. Thus, for the purposes of Section 28 of the Act,
it would be the Assistant Commissioner/the Special Land
Acquisition Officer/the Additional Land Acquisition Officer
as the case may be, who shall be responsible for the
services of notice on the land owners, considering the
objections and passing orders regarding the necessity of
acquiring lands.
63. Similarly, for the purpose of Section 29 of the
Act, it would also mean that the amount of compensation
would have to be determined by agreement between the
Assistant Commissioner/the Special Land Acquisition
Officer/the Additional Land Acquisition Officer and the
person to be compensated. If there is no agreement
between the Assistant Commissioner/the Special Land
Acquisition Officer/the Additional Land Acquisition Officer
and the person to be compensated, the Assistant
- 33 -
NC: 2024:KHC-D:4492
Commissioner/the Special Land Acquisition Officer/the
Additional Land Acquisition Officer is required to refer the
cases to the Deputy Commissioner, who is then required to
determine the amount of compensation to be paid.
64. It is therefore clear that if the compensation to
be paid is to be determined by agreement, then there
must be a meeting of minds between the Assistant
Commissioner/the Special Land Acquisition Officer/the
Additional Land Acquisition Officer and the person to be
compensated; and if there is no such meeting of minds,
the matter will have to be referred to the Deputy
Commissioner for determination of the compensation.
65. To put it in simple terms, the law contemplates
that an attempt should be made by the Assistant
Commissioner/the Special Land Acquisition Officer/the
Additional Land Acquisition Officer, as the case may be,
and the land owner, to agree for the compensation payable
and only if this attempt is unsuccessful should the matter
- 34 -
NC: 2024:KHC-D:4492
be referred to the Deputy Commissioner for determination
of the compensation.
66. In light of this clear statutory mandate, the
procedure adopted by the authorities in constituting a
Price Determination Advisory Committee headed by the
Deputy Commissioner would be improper as it would be in
direct conflict with the statutory mandate. If the Deputy
Commissioner is conferred with the power to determine
the compensation in the event of disagreement between
the Assistant Commissioner/the Special Land Acquisition
Officer/the Additional Land Acquisition Officer and the
person to be compensated, and if he were to himself head
a Committee to determine the price of the land, the intent
of the statute to give the power of determination to the
Deputy Commissioner in the event of a disagreement
would be rendered otiose.
67. To draw an analogy, this procedure would
amount to an Appellate Authority being a signatory to the
- 35 -
NC: 2024:KHC-D:4492
order of the Original Authority, and thereafter hearing an
appeal filed against the order of such authority.
68. Viewed from this angle, the entire approach in
both these cases of the Board in constituting a Committee
headed by the Deputy Commissioner, which would
determine or suggest the price to be paid as
compensation, would be incorrect and contrary to the
statute.
69. It is also to be borne in mind that the person to
be compensated does not really have the remedy of
seeking a reference to the Deputy Commissioner, if the
Deputy Commissioner is the Chairperson of a Committee
constituted to determine the amount of compensation
payable to the land-loser.
70. It must be kept in mind that when the
provisions of the statute stipulate a specific manner to be
followed to achieve a specific result, the manner
suggested is required to be adhered to strictly and the
- 36 -
NC: 2024:KHC-D:4492
same cannot be bypassed or diluted or circumvented by
adopting a completely different approach.
71. Therefore, it is clear that the very concept of
constituting a Committee headed by the Deputy
Commissioner to determine the compensation payable to
the land-loser militates against the statutory provisions,
and the decision/suggestion of said Committee would
completely vitiate the process of determination of the
amount of compensation payable under the agreement.
72. In this regard, the expression "determined by
agreement" found in Section 29(2) would assume
importance and would become rather crucial in
understanding the intent of the law.
73. The term "agreement" has not been defined
under the Act. Therefore, to appreciate the true meaning
of the term "agreement", one would have to fall back on
the meaning of the term "agreement" under the general
law.
- 37 -
NC: 2024:KHC-D:4492
74. Under the provisions of the Indian Contract Act
of 1872, when one person makes a proposal and that
proposal is accepted, it translates into a promise and
where such promise is for a consideration, an agreement is
stated to have been arrived at between the two persons2.
75. In other words, when two persons agree on
carrying out a particular act in a particular manner for a
lawful consideration, there would be an agreement i.e., as
popularly called, there would be a "meeting of the
minds"(consensus ad idem).
76. Chapter - I of the Indian Contract Act deals
with the communication, acceptance and revocation of
proposals. The requirement of said law is that a proposal
should be communicated to the other person and this
communication becomes complete when it comes to the
2. Interpretation-clause.--In this Act the following words and expressions are used in the
following senses, unless a contrary intention appears from the context:--
(a) When one person signifies to another his willingness to do or to abstain from doing
anything, with a view to obtaining the assent of that other to such act or abstinence, he is said
to make a proposal;
(b) When the person to whom the proposal is made signifies his assent thereto, the proposal is
said to be accepted. A proposal, when accepted, becomes a promise;
(c) The person making the proposal is called the "promisor", and the person accepting the
proposal is called the "promisee";
(d) When, at the desire of the promisor, the promisee or any other person has done or
abstained from doing, or does or abstains from doing, or promises to do or to abstain from
doing, something, such act or abstinence or promise is called a consideration for the promise;
(e) Every promise and every set of promises, forming the consideration for each other, is an
agreement;
- 38 -
NC: 2024:KHC-D:4492
knowledge of the person to whom it is proposed, or when
the proposal is put in the course of transmission. Thus, the
first step in the concept of arriving at an agreement is the
communication of a proposal.
77. In the context of this case, necessarily, the
Board would have to first give a proposal regarding the
compensation that it is willing to pay to the land-loser and
communicate the same to the land-loser.
78. The second step under the Contract Act before
arriving at an agreement is the acceptance of the
proposal. The requirement of law is that the acceptance
should be absolute and unqualified and should be
expressed in a usual and reasonable manner. The proposal
may, in fact, prescribe the manner of acceptance and if it
is prescribed, the acceptance is to be made accordingly.
79. On the proposal being communicated, in order
for the proposal to become a promise, the law requires
that there must be an absolute and unqualified acceptance
of the proposal.
- 39 -
NC: 2024:KHC-D:4492
80. The law also stipulates that the acceptance
must be expressed in some usual and reasonable manner.
It also stipulates that if the proposal itself prescribes the
manner in which it is to be accepted and the acceptance is
not made in that manner, the proposer, within a
reasonable time after the acceptance is communicated to
him, may insist that the proposal is to be accepted in the
prescribed manner and not otherwise.
81. A proposal can also become a promise, if the
acceptance of any promise is made in words. If, however,
the proposal or acceptance is made otherwise than in
words, the promise is said to be implied.
82. To put it in simple terms, the law recognises
that there is an agreement between two persons, when a
proposal is made by one person to another and that
person signifies his absolute and unqualified acceptance of
the proposal. Thus, unless there is a clear proposal
communicated to the other person and said proposal is
accepted absolutely and unconditionally, the law will not
- 40 -
NC: 2024:KHC-D:4492
recognise such transaction as having culminated into an
"agreement".
83. In the context of this case, the Board would
therefore had to necessarily make a proposal to the land-
loser and the land-loser would have had to accept the
proposal absolutely and unconditionally. If these two
essential and critical ingredients are not met with, it
cannot be said that there has been a valid and binding
"agreement" regarding the determination of the
compensation.
E. APPLICATION OF LAW TO THE PRESENT FACTS:
84. Now, applying the above legal principles, the
facts of this case would have to be analysed.
85. In respect of the Dharwad lands, the Advisory
Committee, in the meeting held on 26.11.2007, had fixed
the market value at Rs.09,00,000/- per acre and during
the course of this deliberation, it has been clearly recorded
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that the petitioner had made a demand for a much higher
sum.
86. Seven months after the meeting, on
16.06.2008, the petitioner has been served with a notice
stating that the sum Rs.13,36,000/- was fixed per acre.
The petitioner immediately responded by refusing the
proposed offer and also made a counter offer stating that
he would only accept the acquisition if a sum of
Rs.05,91,20,000/- was paid. It is thus clear that the
proposal of the KIADB was in fact rejected by the
petitioner - land loser and this indicates that there was no
agreement.
87. The moment the petitioner had rejected the
proposal of the Advisory Committee as per the mandate of
Section 29(2) of the Act, the Assistant Commissioner/the
Special Land Acquisition Officer/the Additional Land
Acquisition Officer was bound to refer the matter to the
Deputy Commissioner.
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88. However, as already noticed above, when the
Deputy Commissioner himself had headed the committee
which had fixed the price at Rs.09,00,000/-,the question
of referring the matter to the Deputy Commissioner would
not really arise, since that would amount to appealing
"from Caesar to Caesar".
89. It may be pertinent to note here that in both
these cases, the authorities have not taken any steps
pursuant to the refusal of the offer by the petitioner. It
may also be pertinent to notice her that the possession of
the petitioner's land in case of Dharwad lands was taken
over on 16.06.2008 and the petitioner had lost his land to
the Board. It is obvious that if a person were to lose his
land, especially a person who is dependent on the land for
his very livelihood, his situation would be precarious and
fragile.
90. If the person who takes over the land and who
is obliged to compensate him for the same does not
compensate him and merely sits over the matter
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apathetically, it is plainly obvious that the person who has
lost his land would be seriously disadvantaged and at the
mercy of the person who has dispossessed him and on
whom he is dependent on for securing the true price for
his land. In such a situation, it is also glaringly obvious
that person who has taken possession of the land would
be in a position to dominate the will of the person who has
lost his land.
91. Sub-section (1) of Section 163 of the Indian
Contract Act states that a contract is said to be induced by
undue influence where the relations between the parties
are such that one of the parties is in a position to
dominate the will of the other and he uses that position to
obtain an unfair advantage over the other.
92. Section 16(2) of the Indian Contract Act also
16."Undue influence" defined.--(1) A contract is said to be induced by "undue influence"
where the relations subsisting between the parties are such that one of the parties is in a
position to dominate the will of the other and uses that position to obtain an unfair advantage
over the other.
(2) In particular and without prejudice to the generality of the foregoing principle, a person is
deemed to be in a position to dominate the will of another-- (a) where he holds a real or
apparent authority over the other, or where he stands in a fiduciary relation to the other; or (b)
where he makes a contract with a person whose mental capacity is temporarily or permanently
affected by reason of age, illness, or mental or bodily distress.
(3) Where a person who is in a position to dominate the will of another, enters into a contract
with him, and the transaction appears, on the face of it or on the evidence adduced, to be
unconscionable, the burden of proving that such contract was not induced by undue influence
shall lie upon the person in a position to dominate the will of the other. Nothing in this sub-
section shall affect the provisions of section 111 of the Indian Evidence Act, 1872 (1 of 1872).
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declares that a person is deemed to be in a position to
dominate the will of another when he holds real or
apparent authority over the other.
93. If it is noticed that the Board was essentially
the State and the land had stood vested in it and it had
also taken over the possession of the land belonging to the
petitioner without paying him any compensation, it is
obvious that the State was not only holding real authority
over the petitioner, but it was also in a position to force
the petitioner to yield to its demand of accepting the
compensation that it had offered.
94. The withholding of the payment of
compensation or the withholding of the reference to the
Deputy Commissioner under Section 29(2) of the Act
would, by itself, be conclusive proof of the dominant power
of the State that possessed over the land-loser and it was
actually exercised.
95. The facts, by themselves, speak in a rather
boisterous manner, that it only took ten months of
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depriving the petitioner (Dharwad lands)of his rightful
compensation to ensure that he meekly surrendered and
gave up his demand of Rs. 1.20 lakhs per gunta and settle
for the amount of Rs.13,36,000/- per acre that had been
offered to him in June, 2008.
96. The fact that there was no communication of
any kind between the period of June, 2008 and May, 2009
in the matter of determination of the compensation, and
yet the petitioner had a sudden change of heart and he
voluntarily approached the Board to inform them that he
was willing to accept the said amount, speaks volumes
about the desperation of the petitioner to accept the
compensation that had been offered. It is obvious that the
withholding of the compensation and stalling the entire
process resulted in the capitulation of the petitioner and
gave up his zest for fighting for his right to claim the true
market value for his land.
97. The fact that the petitioner had declared his
intention to undertake a fast unto death for payment of
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the compensation for the structures and trees, and
actually undertook the same, only after which the
compensation was paid towards the structures, clearly
proves that the petitioner was pushed to the very brink.
98. There is nothing on record to indicate as to
whether any deliberations took place between the
Assistant Commissioner/the Special Land Acquisition
Officer/the Additional Land Acquisition Officer and the
land-loser in this interregnum of ten long months. There is
also nothing to indicate as to how the Assistant
Commissioner/the Special Land Acquisition /the Additional
Land Acquisition Officer was able to persuade the land-
loser to agree to the proposal that had been made in June,
2008 suddenly in May, 2009.
99. In the absence of any material to indicate that
there were any deliberations to induce the land-loser to
accept the initial offer which he had rejected, it is clear
that the mere acceptance of the first offer was as a result
of the desperate situation that the land-loser had been
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boxed into, and it is clear that there was no "compensation
determined by agreement".
100. If this matter is viewed pragmatically, it will
have to be noticed that the situation was that the State
had taken away the entire lands of the land owner and had
left him without any avocation. The State, by withholding
the compensation for a year, had basically pushed the
petitioner into a corner from which he had no escape, and
it is quite natural that the land-loser would be driven to
the wall and would have no other option but to yield to the
demands of the State.
101. Viewed in this background, the acceptance of
the original offer of Rs.13,36,000/- despite it having been
rejected earlier by the land loser - petitioner cannot be
accepted as "determination by agreement" as
contemplated under Section 29(2) of the Indian Contract
Act.
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102. Section 19A4 of the Indian Contract Act
empowers the Court to set aside a contract that has been
induced by undue influence, either partly or absolutely,
and on such terms and conditions as the Court may deem
just. Since it is clear that the agreement upon which
reliance is placed by the Board was induced by undue
influence, the same cannot be sustained and it will have to
be set aside.
103. As far as the Ballari Lands are concerned, in the
meeting held on 29.09.2010, the petitioners had clearly
expressed that they were not willing to accept the sum of
Rs.30,00,000/- per acre and they had in fact made a
demand of a much higher sum and had also cited a sale
deed of a neighbouring land, in which 37 guntas of land
had been sold for rupees One Crore per acre. Despite this
objection, the petitioners were served with a notice fixing
the compensation of Rs.30,00,000/- per acre.
19A. Power to set aside contract induced by undue influence.--When consent to an
agreement is caused by undue influence, the agreement is a contract voidable at the option of
the party whose consent was so caused.
Any such contract may be set aside either absolutely or, if the party who was entitled
to avoid it has received any benefit thereunder, upon such terms and conditions as to the Court
may seem just.
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104. It is also on record that the petitioners did
make an application seeking enhancement of
compensation as per their representation dated
27.09.2010.In light of the fact that the petitioners had
clearly expressed that they were not agreeable for the
proposal of Rs.30,00,000/- per acre, the matter was
required to be referred to the Deputy Commissioner as
contemplated under Section 29(2) of the Act.
105. It is also to be noticed here that as already
observed in the Dharwad lands' case, the situation is more
or less similar and the Board was definitely in a position to
dominate the will of the land-losers. It is also to be noticed
here that the petitioners did present an application on
23.06.2011 (Annexure-P) seeking enhancement of
compensation but no action was taken after said request
was made.
106. It is also to be noticed here that the value of
Rs.30,00,000/- per acre was fixed in the month of
September, 2010 and the petitioners were not paid any
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sum for nearly two years thereafter, and it is only after the
petitioners agreed to execute the documents,was the
compensation as determined by the Committee paid to
them.
107. The acceptance of this compensation at
Rs.30,00,000/- per acre was therefore induced by the
undue influence and the same will have to be set aside.
F. CONCLUSION
108. It is hereby declared that the agreements
executed by the petitioners in both these cases were
vitiated as they were obtained by exerting undue influence
on them and they cannot therefore be bound by the terms
of said agreements.
109. For the reasons stated above, the agreements
upon which reliance is placed by the Board in cases
pertaining to the Dharwad Lands and the Ballari Lands to
evidence acceptance of compensation, shall stand
quashed.
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110. As already stated above, since the entire
approach of the authorities in holding a public meeting by
constituting a Committee headed by the Deputy
Commissioner is fundamentally opposed to the mandate of
Section 29(2), any payment made on the basis of the
decision of the Committee would not amount to payments
of compensation which has been determined under an
agreement.
111. Since the Deputy Commissioner has himself
suggested the compensation payable while heading the
Committee, it is obvious that the matter cannot now be
referred to him to determine the compensation. As a
consequence, the authorities shall refer the matter to the
Civil Court, who shall determine the compensation that the
petitioners would be entitled to.
112. The Civil Court shall treat the matter as a
reference under Section 18(3) of the Land Acquisition Act
of1894, thereafter hold an enquiry to determine whether
the claim of the petitioners for the higher compensation is
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justified, either wholly or in-part, and pass appropriate
orders.
113. The writ petitions are accordingly allowed.
G. DIRECTIONS:
114. Before parting with this case, it would be
necessary to lay down the procedure which the Board is
required to follow under Section 29(2) for determining the
amount of compensation payable by agreement.
115. This has become necessary since there are no
statutory rules framed under the Act in this regard and
also because the delay in determining the compensation
violates the fundamental rights of a citizen guaranteed
under Articles 14, 19 and 21 of the Constitution, while
causing serious prejudice to the land-loser, thereby giving
the officials of the State an unfair advantage over a person
who has lost his land.
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116. The Board shall follow the following procedure
in the matter of determining compensation under Section
29 of the Act.
a. The Board shall not follow the procedure of
constituting a Committee to determine the price
of the land for the purposes of Section 29(2) of
the Act as the same would be contrary to the
statutory provisions;
b. The Assistant Commissioner/the Special Land
Acquisition Officer/the Additional Land
Acquisition Officer, as the case may be, shall
make a written offer to the land-loser within a
month of the declaration under Section
28(4)being published, clearly stating the amount
of compensation that he is prepared to offer for
the lands acquired;
c. If the land loser were to refuse the offer in
writing, the Assistant Commissioner/the Special
Land Acquisition Officer/the Additional Land
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Acquisition Officer shall within a month
thereafter, refer the matter of the Deputy
Commissioner for determining the amount of
compensation;
d. If the land-loser is incapable of being notified of
the written offer or if he fails to respond to the
offer within the aforementioned period of 2
months from the written offer of the Board/the
Assistant Commissioner/the Special Land
Acquisition Officer/the Additional Land
Acquisition Officer, it shall be presumed that the
land-loser has refused to accept compensation
by way of an agreement and the Assistant
Commissioner/the Special Land Acquisition
Officer/the Additional Land Acquisition Officer
shall forthwith refer the matter to the Deputy
Commissioner for determining the
compensation;
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e. In either of these cases, the Assistant
Commissioner/the Special Land Acquisition
Officer/the Additional Land Acquisition Officer
shall deposit the amount that he has offered as
compensation, in the Civil Court, and the Civil
Court shall thereafter invest the same in a Fixed
Deposit;
f. If the land-loser were to make a counter-offer to
the written proposal of the Assistant
Commissioner/the Special Land Acquisition
Officer/the Additional Land Acquisition Officer, it
would be open for the Assistant
Commissioner/the Special Land Acquisition
Officer/the Additional Land Acquisition Officer to
either consider the counter-offer or reject the
counter-offer or even embark upon a further
course of deliberation. However, in no event
shall the deliberations be continued beyond 6
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months from the date of publication of the
declaration in the Gazette;
g. On the expiry of six months from the date of
publication of the declaration under Section
28(4) in the Gazette, whether the land-loser has
agreed to the offer or not, the Assistant
Commissioner/the Special Land Acquisition
Officer/the Additional Land Acquisition Officer
shall refer the matter to the Deputy
Commissioner for determination of the
agreement and also deposit the amount that it
had offered, in the Civil Court, which shall invest
the amount in a Fixed Deposit;
h. It is hereby clarified that mere deposit of the
amount offered by the Assistant
Commissioner/the Special Land Acquisition
Officer/the Additional Land Acquisition Officer
would not disentitle the land-losers for any
interest that they may be entitled to in terms of
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the provisions relating to payment of interest
under the Land Acquisition Act;
i. The Deputy Commissioner shall within 6months
of the reference to him by the Assistant
Commissioner/the Special Land Acquisition
Officer/the Additional Land Acquisition Officer
determine the compensation as provided under
Section 29(3) of the Act; and
j. The land-loser will then have the option of
seeking a reference to the Civil Court and he
would be entitled to seek withdrawal of the
amount that has been deposited pursuant to the
offer made by the Assistant Commissioner/the
Special Land Acquisition Officer/the Additional
Land Acquisition Officer (only in cases where
there is no dispute regarding the entitlement of
the land-loser).
k. It is also made clear that it would be open for
the KIADB to straightaway refer the matter to
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the Deputy Commissioner for determination of
compensation, if it does not wish to enter into
the process of determination of compensation
by way of an Agreement under Section 29(2) of
the Act.
Sd/-
JUDGE
VNP*/CT:BCK
