Andhra Pradesh Indus... v. Chinthamaneni Narasi..., Supreme Court Of India, Judgment, Law, casemine.com

Citation Codes

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Case Number

Civil Appeals Nos. 304-305 of 2005, decided on September 15, 2011

Disposition

allowed

Advocates

A.K Ganguli, Senior Advocate (Guntur Prabhakar, Ms T. Anamika and Anisetty Chandra Mohan, Advocates) for the Appellant;
Jaideep Gupta, Senior Advocate (G. Ramakrishna Prasad, B. Suyodhan, John Mathew, Ms T. Anamika, Ms Anagha S. Desai and Mohd. Wasay Khan, Advocates) for the Respondents.

Judges

Justice Anil R. Dave
Justice Mukundakam Sharma

Acts

Section 5-A of the Act
Section 5-A of the Land Acquisition Act, 1894
Section 17 of the Act
Section 4 of the Act
Section 4(1), Section 6 of the Act
Section 17 of the Land Acquisition Act, 1894
Article 226 of the Constitution
Section 5, Subsection 2 of the 1983 Income Tax Act
The 1983 Income Tax Act (not explicitly mentioned, but implied)
Section 4(1) of the Land Acquisition Act, 1894
Section 6 of the Land Acquisition Act, 1894

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Smart Summary

Factual and Procedural Background

A notification under Section 4(1) of the Land Acquisition Act, 1894 was issued on 27-08-1993 for acquiring 101 acres 33 cents of land around Eluru Town to develop an Auto Nagar. Because urgency was invoked under Section 17, the Section 5-A enquiry was initially dispensed with and a declaration under Section 6 followed on 08-10-1993.

The landowners filed W.P. No. 5036 of 1994; on 18-09-1995 the High Court quashed the first Section 6 declaration and ordered a fresh Section 5-A enquiry. After hearing objections, the State decided to acquire only 54 acres 54 cents. A second Section 6 declaration was issued on 07-08-1996, an award passed on 07-01-1998, paper possession taken on 09-03-1998 and physical possession handed to the appellant-Corporation on 16-07-1998.

The landowners again challenged the acquisition in W.P. No. 32806 of 1998, alleging the second Section 6 declaration was time-barred. A learned Single Judge dismissed the petition on 27-08-1999. The Division Bench, however, allowed W.A. No. 1337 of 1999 on 23-07-2001 and, on review (WAMP No. 1822 of 2002), reaffirmed that decision on 01-10-2004. The State undertaking, A.P. Industrial Infrastructure Corporation Ltd., appealed to the Supreme Court.

Legal Issues Presented

Whether the landowners’ writ petition challenging the acquisition was liable to be dismissed on the ground of laches and delay.
Whether the second declaration under Section 6 of the Land Acquisition Act was issued within the statutory time-limit (an issue the High Court decided but which the Supreme Court considered unnecessary to examine).

Arguments of the Parties

Appellant's Arguments

The writ petition filed in 1998 was unduly delayed; by then the award had been passed and possession taken, rendering the challenge barred by laches.
In any event, the Section 6 declaration dated 07-08-1996 was within the permissible period under the Act.

Respondents' (Landowners') Arguments

The Division Bench of the High Court correctly held that the Section 6 declaration was issued beyond the statutory period and was therefore void.
The acquisition proceedings were consequently vitiated, entitling the landowners to relief.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Swaika Properties (P) Ltd. v. State of Rajasthan (2008) 4 SCC 695	A writ challenging land acquisition after possession has been taken is generally not maintainable.	Relied upon to emphasise that post-possession challenges are barred.
Municipal Corpn. of Greater Bombay v. Industrial Development Investment Co. (P) Ltd. (1996) 11 SCC 501	Court should be slow to quash acquisition where there is inordinate delay, award is passed and possession taken.	Cited as the core authority on laches; excerpt reproduced by the Court.
State of Rajasthan v. D.R. Laxmi (1996) 6 SCC 445	Reiterates the principle in Municipal Corpn. of Greater Bombay regarding delay and possession.	Quoted to reinforce that High Courts should not interfere after award and possession.
Municipal Council, Ahmednagar v. Shah Hyder Beig (2000) 2 SCC 48	After the award is passed, no writ can be entertained against the acquisition.	Used to underline that challenge after award is impermissible.
C. Padma v. Govt. of T.N. (1997) 2 SCC 627	Authority for the proposition followed in Shah Hyder Beig that post-award challenges are barred.	Referenced indirectly through Shah Hyder Beig.

Court's Reasoning and Analysis

The Supreme Court confined its analysis to the issue of delay. It noted that the second Section 6 declaration was made on 07-08-1996, the award on 07-01-1998, and possession (at least paper possession) was taken on 09-03-1998; yet the landowners waited until November 1998 to file their writ petition. Relying on a line of authorities that bar writ petitions filed after award and possession, the Court held that such delay is fatal. The Court reasoned that landowners aware of the declaration should have acted promptly; allowing belated challenges would unsettle public projects and defeat the purpose of timely acquisition. As the appeals could be allowed on the ground of laches alone, the Court found it unnecessary to examine the correctness of the High Court’s finding on the limitation period under Section 6.

Holding and Implications

APPEALS ALLOWED; the Division Bench judgment set aside and the acquisition proceedings upheld.

The decision restores the acquisition in favour of the A.P. Industrial Infrastructure Corporation. While it creates no new legal principle, it reinforces existing jurisprudence that writ challenges to land acquisition must be brought promptly, preferably before the award and certainly before possession is taken. Delay alone can be determinative, thereby providing certainty to public projects dependent on acquired land.

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Andhra Pradesh Industrial Infrastructure Corporation Limited v. Chinthamaneni Narasimha Rao And Others

The Judgment of the Court was delivered by

Anil R. Dave, J.— Being aggrieved by the judgment and order dated 23-7-2001 in Writ Appeal No. 1337 of 1999 and Review WAMP No. 1822 of 2002 in Writ Appeal No. 1337 of 1999 dated 1-10-2004 passed by the High Court of Judicature of Andhra Pradesh at Hyderabad, these appeals have been filed by the original petitioner-respondents herein, whose lands have been acquired by the State for a public purpose.

2. The facts giving rise to the present litigation in a nutshell are as under: a Notification under Section 4(1) of the Land Acquisition Act, 1894 (in short “the Act”) was issued on 27-8-1993 for acquisition of land admeasuring 101 acres and 33 cents in and around Eluru Town for a public purpose for setting up an Auto Nagar so as to develop the said land for industrial purpose. On 20-9-1993 and 21-9-1993, the said notification was published in two daily newspapers whereas on 29-9-1993 the substance of the said notification was published in the locality where the land was situated. Looking into the urgency, under the provisions of Section 17 of the Act, an inquiry under Section 5-A of the Act was dispensed with. Thereafter the Notification with regard to the declaration under Section 6 of the Act was published on 8-10-1993.

3. A Writ Petition No. 5036 of 1994 was filed on 18-9-1995 challenging the validity of the proceedings on the ground that the provision of Section 17 of the Act could not have been invoked for dispensing with the enquiry under Section 5-A of the Act and in the said petition, the High Court of Andhra Pradesh had passed an interim order whereby the authorities were restrained from taking possession of the land in question. Ultimately, the said petition was finally disposed of on 18-9-1995 whereby the declaration under Section 6 had been quashed and it was directed to hold an enquiry under Section 5-A of the Act.

4. In pursuance to the above order passed by the High Court, necessary enquiry under Section 5-A of the Act was made, objections were invited and ultimately it was decided to acquire only 54 acres and 54 cents land out of the land in question admeasuring 101 acres and 33 cents. The declaration under Section 6 of the Act was thereafter published on 7-8-1996. After making declaration under Section 6 of the Act, award was made on 7-1-1998 and possession of the land in question was taken on 9-3-1998. After possession of land in question was taken by the Land Acquisition Officer from the owners of the land, on 16-7-1998, the Land Acquisition Officer handed over possession of the land in question to the present appellant Corporation for a public purpose, for which the land in question had been acquired.

5. It is pertinent to note that after declaration under Section 6 of the Act made on 7-8-1996 and after taking possession of the land in question on 9-3-1998, Writ Petition No. 32806 of 1998 was filed in the High Court of Andhra Pradesh challenging the validity of the declaration under Section 6 of the Act on the ground that the declaration was not made within the period prescribed under Section 6 of the Act. By an order dated 27-8-1999, the learned Single Judge dismissed the aforesaid writ petition after recording the fact that award was made on 7-1-1998 and possession of the land in question had been handed over to the present appellant on 9-3-1998. Moreover, the learned Single Judge also held that the declaration under Section 6 was made within the period stipulated under Section 6 of the Act.

6. Being aggrieved by the dismissal of the petition, the landowners, the present respondents, filed Writ Appeal No. 1337 of 1999. The said writ appeal was allowed by an order dated 23-7-2001 whereby the order passed by the learned Single Judge dated 27-8-1999 was quashed and set aside as it was held by the Division Bench of the High Court that the declaration under Section 6 of the Act was made beyond the period prescribed under Section 6 of the Act.

7. Being aggrieved by the said judgment and order, A.P Industrial Infrastructure Corporation, the present appellant, filed a review petition being Review WAMP No. 1822 of 2002 in Writ Appeal No. 1337 of 1999 on 29-8-2001 which was also dismissed by the Division Bench of the High Court by the impugned judgment and order on 1-10-2004. Being aggrieved by the above judgment and order passed by the Division Bench of the High Court these appeals have been filed by A.P Industrial Infrastructure Corporation Ltd., which is an undertaking owned by the Government of Andhra Pradesh for whose benefit the land in question had been acquired.

8. The learned counsel appearing for the appellant mainly made two submissions: the first is with regard to the delay caused in filing the petition or initiation of litigation challenging the validity of the acquisition proceedings and the second is with regard to delay caused in making the declaration under Section 6 of the Act. According to him the declaration was made within the period prescribed under Section 6 of the Act.

9. On the other hand, the learned counsel appearing for the landowners supported the reasons given by the Division Bench of the Andhra Pradesh High Court and submitted that the declaration under Section 6 was made beyond the period prescribed under Section 6 of the Act.

10. We have heard the learned counsel at great length. Several judgments were cited by the learned counsel so as to substantiate their cases. In our view there was substantial delay caused in filing the petition before the Andhra Pradesh High Court whereby the land acquisition proceedings had been challenged by the landowners and, therefore, we would not like to go into other reasons and other submissions which pertain to delay caused in making declaration under Section 6 of the Act.

11. It is not in dispute that the Notification under Section 4 of the Act was issued on 27-8-1993 and it was lastly published, in the locality where the land is situated on 29-9-1993. We have already referred to the earlier litigation and the objections filed by the landowners and the decision with regard to the Land Acquisition Officer and the government authorities for not acquiring the entire land, which was sought to be acquired at an earlier stage. Ultimately, the land admeasuring 54 acres and 54 cents had been acquired out of the land in question admeasuring 101 acres and 33 cents. It is not in dispute that the declaration under Section 6 was made on 7-8-1996 and an award was made on 7-1-1998. Though there is some dispute with regard to the fact of taking possession of the land, it is an admitted fact that at least paper possession of the land in question was taken on 9-3-1998 and possession was handed over to the appellant on 16-7-1998.

12. Thus, it is an admitted fact that the declaration under Section 6 of the Act was made on 7-8-1996 and the award was made on 7-1-1998. A petition challenging the validity of the declaration under Section 6 of the Act on the ground that it was declared beyond the period specified under Section 6 of the Act was filed in November 1998. In our opinion, the petition had been filed at a belated stage. If the landowners were really aggrieved by the declaration under Section 6 of the Act, they ought to have challenged the same immediately after the declaration under Section 6 was made. For the reasons best known to them, they waited for more than two years. The award was made on 7-1-1998 and even possession was taken on 9-3-1998 and on 16-7-1998, the possession was also handed over to the present appellant so that it can use the land in question for a public purpose for which it had been acquired. The learned Single Judge duly recorded the fact that possession of the land in question was taken from the landowners on 9-3-1998. We see no reason for the landowners to wait for a few years for challenging the declaration made under Section 6 of the Act on the ground of delay. If the landowners had been really aggrieved, they ought to have challenged the proceedings immediately after declaration was made under Section 6 of the Act.

13. This Court has held in several judgments that if the landowners are aggrieved by the acquisition proceedings, they must challenge the same at least before an award is made and the possession of the land in question is taken by the government authorities.

14. It has been held in Swaika Properties (P) Ltd. v. State of Rajasthan (2008) 4 SCC 695 as under:

“16. This Court has repeatedly held that a writ petition challenging the notification for acquisition of land, if filed after the possession having been taken, is not maintainable. In Municipal Corpn. of Greater Bombay v. Industrial Development Investment Co. (P) Ltd. (1996) 11 SCC 501 where K. Ramaswamy, J. speaking for a Bench consisting of His Lordship and S.B Majmudar, J. held:

‘29. It is thus well-settled law that when there is inordinate delay in filing the writ petition and when all steps taken in the acquisition proceedings have become final, the court should be loath to quash the notifications. The High Court has, no doubt, discretionary powers under Article 226 of the Constitution to quash the notification under Section 4(1) and declaration under Section 6. But it should be exercised taking all relevant factors into pragmatic consideration. When the award was passed and possession was taken, the court should not have exercised its power to quash the award which is a material factor to be taken into consideration before exercising the power under Article 226. The fact that no third-party rights were created in the case is hardly a ground for interference. The Division Bench of the High Court was not right in interfering with the discretion exercised by the learned Single Judge dismissing the writ petition on the ground of laches.’”

15. Similarly, in State of Rajasthan v. D.R Laxmi (1996) 6 SCC 445 following the decision of this Court in Municipal Corpn. of Greater Bombay (1996) 11 SCC 501 it was held: (Municipal Corpn. of Greater Bombay (1996) 11 SCC 501)

“29. … When the award was passed and possession was taken, the court should not have exercised its power to quash the award which is a material factor to be taken into consideration before exercising the power under Article 226. The fact that no third-party rights were created in the case is hardly a ground for interference. The Division Bench of the High Court was not right in interfering with the discretion exercised by the learned Single Judge dismissing the writ petition on the ground of laches.”

16. To the similar effect is the judgment of this Court in Municipal Council, Ahmednagar v. Shah Hyder Beig (2000) 2 SCC 48 wherein this Court, following the decision of this Court in C. Padma v. Govt. of T.N (1997) 2 SCC 627, held: (Shah Hyder case (2000) 2 SCC 48)

“17. In any event, after the award is passed no writ petition can be filed challenging the acquisition notice or against any proceeding thereunder. This has been the consistent view taken by this Court and in one of the recent cases (C. Padma v. Govt. of T.N (1997) 2 SCC 627)….”

17. Therefore, we are not referring to the other judgments which have been cited by the learned counsel on the subject of validity of declaration made under Section 6 of the Act for the reasons that we are convinced that there was gross delay in challenging the validity of the acquisition proceedings.

18. It is also pertinent to note that according to the appellant, possession of the land in question had been handed over to the appellant Corporation on 16-7-1998 and in view of the said fact, this Court had granted interim stay in favour of the appellant on 10-1-2005 and an application made by the landowners for vacating the said stay had been rejected and it was directed to maintain status quo.

19. Looking to the facts of the present case and in the light of the law laid down by this Court, which has been referred to hereinabove, we firmly believe that the petition filed by the landowners was at a belated stage. For the said reason, we do not desire to interfere with the acquisition proceedings which had been challenged after more than two years of the declaration made under Section 6 of the Act and on that ground alone we feel that appeals deserve to be allowed.

20. The impugned judgment and order passed by the Division Bench of the High Court of Andhra Pradesh is quashed and set aside. The appeals are allowed with no order as to costs.

Andhra Pradesh Indus... v. Chinthamaneni Narasi...