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K.N Aswathnarayana S... v. State Of Karnataka A...
Factual and Procedural Background
The State of Karnataka issued a Section 4(1) notification under the Land Acquisition Act, 1894 on 6-8-1991 to acquire, inter alia, Survey No. 49/1 (15 acres) for the State Government Houseless Harijan Employees Association (“the Society”). A Section 6 declaration followed on 15-5-1992.
On 5-8-1993 the Government, at the instance of the then landowners, denotified the land under Section 48(1). The Society’s writ challenge failed in the High Court, but succeeded in the Supreme Court, which on 11-12-2000 (2001 1 SCC 610) quashed the 1993 denotification and revived the acquisition.
While the Society’s appeal was pending, the present petitioners purchased the land in 1997-1998 and later sought denotification. When no decision came, they obtained a High Court direction (19-2-2003) for the State to consider their application. Acting thereon, the Revenue Minister passed an order dated 27-2-2004 again denotifying the land.
The Revenue Department refused to act on the 2004 order, endorsing on 21-9-2005 that possession had been taken on 6-9-2002 and that the earlier Supreme Court judgment had settled the matter. The petitioners’ writ petition to quash the endorsement was dismissed by a Single Judge (17-4-2008) and the dismissal was affirmed in writ appeal on 24-10-2011. The petitioners now challenged the appellate judgment before the Supreme Court.
Legal Issues Presented
- Whether purchasers of land after a Section 4 notification and during pendency of litigation can seek or sustain a denotification of the acquisition.
- Whether the 27-2-2004 order of the Revenue Minister denotifying the land was valid despite the earlier Supreme Court judgment quashing the 1993 denotification.
- Whether the petitioners, as subsequent purchasers, are entitled to challenge acquisition proceedings or are limited only to claiming compensation.
Arguments of the Parties
Petitioners’ Arguments
- The 1993 denotification was set aside only for failure to hear the Society; hence, after notice to all parties, the State was free to denotify again.
- The Revenue Minister was competent to pass the 2004 denotification order; the High Court’s contrary view is erroneous.
- Because no interim stay was operating when they purchased the land, their titles should not be affected by the subsequent Supreme Court decision.
Respondents’ Arguments
- The 2001 Supreme Court judgment quashed the 1993 denotification both for breach of natural justice and on merits, holding there was no justification to withdraw the acquisition.
- Purchasers after the Section 4 notification take the land subject to the acquisition; by the doctrine of lis pendens they are bound by the result of the pending litigation.
- Possession had already been taken on 6-9-2002; once land vests in the State it cannot be divested, making the 2004 denotification void.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| State Govt. Houseless Harijan Employees' Assn. v. State of Karnataka (2001 1 SCC 610) | Denotification vitiated when beneficiary not heard and when reason is unjustified; acquisition stood revived. | Earlier decision binding on petitioners; revival of acquisition left no scope for fresh denotification. |
| K. Adivi Naidu v. E. Duruvasulu Naidu (1995 6 SCC 150) | Doctrine of lis pendens – transferee pendente lite bound by decree. | Cited to hold purchasers during litigation cannot avoid the effect of the ultimate judgment. |
| Venkatrao Anantdeo Joshi v. Malatibai (2003 1 SCC 722) | Doctrine of lis pendens. | Same application as above. |
| Raj Kumar v. Sardari Lal (2004 2 SCC 601) | Doctrine of lis pendens. | Same application as above. |
| Sanjay Verma v. Manik Roy (2006 13 SCC 608) | Doctrine of lis pendens. | Same application as above. |
| Rajender Singh v. Santa Singh (1973 2 SCC 705) | Lis pendens prevents parties from defeating court’s jurisdiction by private dealings. | Quoted to emphasise that purchasers cannot frustrate the decree. |
| T.G Ashok Kumar v. Govindammal (2010 14 SCC 370) | Reaffirmation of lis pendens doctrine. | Relied on for the same proposition. |
| V. Chandrasekaran v. Administrative Officer (2012 12 SCC 133) | Purchase after Section 4 notification is at purchaser’s peril; such purchaser can only claim compensation. | Applied to hold petitioners have no locus to challenge acquisition. |
| Lila Ram v. Union of India (1975 2 SCC 547) | Purchaser after notification cannot question acquisition. | Cited within Chandrasekaran line of authority. |
| Sneh Prabha v. State of U.P (1996 7 SCC 426) | Same principle as above. | Reinforced purchaser’s limited rights. |
| Meera Sahni v. Lt. Governor of Delhi (2008 9 SCC 177) | Same principle as above. | Relied on for purchaser’s lack of standing. |
| Tika Ram v. State of U.P (2009 10 SCC 689) | Same principle as above. | Reiterated purchaser’s position. |
| Lt. Governor of H.P v. Avinash Sharma (1970 2 SCC 149) | Upon taking possession under Sections 16/17, land vests irrevocably in the State. | Used to show that land already vested and could not be denotified. |
| Satendra Prasad Jain v. State of U.P (1993 4 SCC 369) | Vesting of land after possession is absolute. | Same as above. |
| Mandir Shree Sita Ramji v. Collector (LA) (2005 6 SCC 745) | Vesting of acquired land cannot be divested. | Same as above. |
| Sulochana Chandrakant Galande v. Pune Municipal Transport (2010 8 SCC 467) | Irrevocable vesting after possession. | Same as above. |
Court's Reasoning and Analysis
The Court observed that when it had earlier (2001) quashed the 1993 denotification, the original acquisition notifications automatically revived. At the time the present petitioners purchased the land, the Society’s appeal was pending; under Section 52 of the Transfer of Property Act and the doctrine of lis pendens, their purchase was subject to the result of that litigation.
Relying on a series of precedents, the Court held that a transferee pendente lite is bound by the decree and cannot prevent the State or the beneficiary from enjoying the fruits of the judgment. The petitioners therefore lacked standing to challenge the acquisition; at most they could seek compensation.
The Court further noted that possession had already been taken on 6-9-2002. Under Sections 16/17 of the Land Acquisition Act, once possession is taken the land vests irrevocably in the State, making any subsequent denotification legally impossible.
Because these findings decisively disposed of the matter, the Court found it unnecessary to examine other contentions, including the competence of the Revenue Minister.
Holding and Implications
DISMISSED – The petitions were rejected in entirety. The Court clarified that purchasers of land after a Section 4 notification and during pending litigation cannot challenge the acquisition; they are limited to compensation under the Land Acquisition Act. No new legal precedent was created, but existing doctrines of lis pendens and irrevocable vesting were reaffirmed.
Dr B.S Chauhan, J.— These petitions have been filed against the judgment and order dated 24-10-2011, passed by the High Court of Karnataka at Bangalore in K.N Aswathanarayana Setty v. State of Karnataka Writ Appeal No. 1421 of 2008, Writ Appeal No. 1014 of 2008 (KAR), etc. affirming the judgment of the learned Single Judge dated 17-4-2008 passed in K.N Aswathanarayana Setty v. State of Karnataka WP No. 11502 of 2006, by which and whereunder the Court had quashed the order dated 27-2-2004, passed by the Revenue Minister, Government of Karnataka denotifying the suit land from acquisition.
2. The facts and circumstances giving rise to these petitions are: that a preliminary notification under Section 4(1) of the Land Acquisition Act, 1894 (hereinafter referred to as “the 1894 Act”) was issued in respect of huge chunk of land including Survey No. 49/1 admeasuring 15 acres on 6-8-1991 for the benefit of the State Government Houseless Harijan Employees Association (Regd.) (hereinafter referred to as “the Society”). In respect of the same land declaration under Section 6 of the 1894 Act was issued on 15-5-1992. At the behest of the then owners of the suit land the Government denotified the land from acquisition vide Order dated 5-8-1993 issuing notification under Section 48(1) of the 1894 Act. Aggrieved, Respondent 3 Society, challenged the said order of denotifying the land from acquisition by filing writ petition which was dismissed WP No. 11502 of 2006 by the learned Single Judge. The said order was also affirmed by the Division Bench Writ Appeal No. 1421 of 2008, Writ Appeal No. 1014 of 2008 (KAR) dismissing the writ appeal preferred by the Society. The Society approached this Court by filing special leave petitions which were entertained and finally heard Civil Appeal No. 5015 of 1999, etc. and this Court vide judgment and order dated 11-12-2000 (2001) 1 SCC 610, AIR 2001 SC 437 quashed the order dated 5-8-1993 denotifying the suit land from acquisition.
3. During the pendency of Civil Appeal No. 5015 of 1999, etc. filed by the respondent Society, the present petitioners purchased the suit land in the years 1997-1998 and approached the Government of Karnataka to denotify the said land from acquisition. As their application for release was not dealt with by the Government, they preferred Writ Petitions Nos. 19968-97 of 2002, etc. before the High Court for directions to the Government to release the land. The High Court vide judgment and order dated 19-2-2003 WP No. 19968 of 2002 disposed of the said writ petition, directing the Government to decide their application in accordance with law expeditiously. In pursuance of the High Court order, the Government of Karnataka issued notice to all parties concerned and against all the parties the Hon'ble Revenue Minister passed an order dated 27-2-2004, directing to denotify the land from acquisition.
4. The order dated 27-2-2004 was not complied with as the Deputy Secretary to the Government of Karnataka raised certain objections and made an endorsement dated 21-9-2005 that the matter had attained finality after being decided by this Court and possession of the land had already been taken and handed over to the respondent Society on 6-9-2002, much prior to the order passed by the Hon'ble Minister.
5. The present petitioners filed Writ Petition No. 11502 of 2006, etc. before the High Court to quash the endorsement dated 21-9-2005 made by the learned Deputy Secretary, Government of Karnataka. The writ petition stood dismissed on 17-4-2008 WP No. 11502 of 2006 in terms of the judgment of the same date in a similar case i.e M.V Kasturi v. State of Karnataka ILR 2008 KAR 3961, (2009) 3 Kant LJ 340.
6. Aggrieved, the petitioners preferred Writ Appeal No. 1421 of 2008 which has been dismissed by the impugned judgment and order Writ Appeal No. 1421 of 2008, Writ Appeal No. 1014 of 2008 (KAR). Hence, these petitions.
7. Shri Kailash Vasdev, learned Senior Counsel appearing for the petitioners submitted that the courts below have committed an error in dismissing the case of the petitioners as the courts failed to appreciate the legal issues. This Court set aside the order of denotification dated 5-8-1993 on a technical ground as the order of denotification was passed without hearing the respondent Society for whose benefit the land had been acquired. Thus, there could be no prohibition for the State to denotifying the land from acquisition after hearing the parties concerned. More so, the Hon'ble Minister had competence to deal with the acquisition proceedings and thus the finding recorded by the High Court about his competence is perverse. More so, as there was no interim order of this Court in the Society's appeal, the petitioners could purchase the land. Hence, these petitions should be accepted.
8. Per contra, Shri Rama Jois and Shri K.N Bhat, learned Senior Counsel for the respondents have opposed the petitions contending that this Court has set aside the order dated 5-8-1993 denotifying the land from acquisition not only on the ground of violation of principles of natural justice but also on merits as it had been held by this Court that there was no justification for denotifying the land. The present petitioners are purchasers of land subsequent to notification under Section 4(1) of the 1894 Act, and they could not purchase the land at all. In view of the fact that the appeal filed by Respondent 3 against the order dated 5-8-1993 was pending before this Court, the doctrine of lis pendens would apply. Thus, the petitions are liable to be dismissed.
9. We have considered the rival submissions made by the learned counsel for the parties and perused the record.
10. The facts are not in dispute. At the time of purchase of the suit land by the present petitioners the matter was sub judice before this Court and if the order of denotification dated 5-8-1993 stood quashed, it would automatically revive the land acquisition proceedings meaning thereby the notification under Section 4 and declaration under Section 6 resurfaced by operation of law. In such a fact situation, it is not permissible for the present petitioners to argue that merely because there was no interim order in the appeal filed by Respondent 3, the petitioners had a right to purchase the land during the pendency of the litigation and would not be bound by the order of this Court quashing the denotification of acquisition proceedings.
11. The doctrine of lis pendens is based on legal maxim ut lite pendente nihil innovetur (during a litigation nothing new should be introduced). This doctrine stood embodied in Section 52 of the Transfer of Property Act, 1882. The principle of “lis pendens” is in accordance with the equity, good conscience or justice because they rest upon an equitable and just foundation that it will be impossible to bring an action or suit to a successful termination if alienations are permitted to prevail. A transferee pendente lite is bound by the decree just as much as he was a party to the suit. A litigating party is exempted from taking notice of a title acquired during the pendency of the litigation. However, it must be clear that mere pendency of a suit does not prevent one of the parties from dealing with the property constituting the subject-matter of the suit. The law simply postulates a condition that the alienation will, in no manner, affect the rights of the other party under any decree which may be passed in the suit unless the property was alienated with the permission of the court. The transferee cannot deprive the successful plaintiff of the fruits of the decree if he purchased the property pendente lite. (Vide K. Adivi Naidu v. E. Duruvasulu Naidu (1995) 6 SCC 150, Venkatrao Anantdeo Joshi v. Malatibai (2003) 1 SCC 722, Raj Kumar v. Sardari Lal (2004) 2 SCC 601 and Sanjay Verma v. Manik Roy (2006) 13 SCC 608.)
12. In Rajender Singh v. Santa Singh (1973) 2 SCC 705, while dealing with the application of doctrine of lis pendens, this Court held as under:
“15. The doctrine of lis pendens was intended to strike at attempts by parties to a litigation to circumvent the jurisdiction of a court, in which a dispute on rights or interests in immovable property is pending, by private dealings which may remove the subject-matter of litigation from the ambit of the court's power to decide a pending dispute or frustrate its decree.”
(See also T.G Ashok Kumar v. Govindammal (2010) 14 SCC 370.)
13. In view of the above, we are of the considered opinion that it is not permissible to say that in case the petitioners had purchased the suit property during the pendency of the appeal filed by Respondent 3 before this Court, the petitioners are not bound by the final orders of this Court.
14. By operation of law, as this Court quashed the denotification of acquisition proceedings, the proceedings stood revived. In V. Chandrasekaran v. Administrative Officer (2012) 12 SCC 133, this Court considered the right of purchaser of land subsequent to the issuance of Section 4 notification and held that anyone who deals with the land subsequent to a Section 4 notification being issued, does so, at his own peril. Section 4 notification gives a notice to the public at large that the land in respect to which it has been issued, is needed for a public purpose, and it further points out that there will be “an impediment to anyone to encumber the land acquired thereunder”. The alienation thereafter does not bind the State or the beneficiary under the acquisition. In fact, purchase of land after publication of a Section 4 notification in relation to such land, is void against the State and at the most, the purchaser may be a person interested in compensation, since he steps into the shoes of the erstwhile owner and may therefore, merely claim compensation. Thus, the purchaser cannot challenge the acquisition proceedings. While deciding the said case this Court placed reliance on a very large number of its earlier judgments including Lila Ram v. Union of India (1975) 2 SCC 547, Sneh Prabha v. State of U.P (1996) 7 SCC 426, Meera Sahni v. Lt. Governor of Delhi (2008) 9 SCC 177 and Tika Ram v. State of U.P (2009) 10 SCC 689
15. The law on the issue can be summarised to the effect that a person who purchases land subsequent to the issuance of a Section 4 notification with respect to it, is not competent to challenge the validity of the acquisition proceedings on any ground whatsoever, for the reason that the sale deed executed in his favour does not confer upon him any title and at the most he can claim compensation on the basis of his vendor's title.
16. In order to meet the menace of sale of land after initiation of acquisition proceedings, various States enacted the Acts and making such transfers as punishable e.g the Delhi Lands (Restrictions on Transfer) Act, 1972 made the sales permissible only after grant of permission for transfer by the authority prescribed therein. In absence of such permission if the sale is made in contravention of the statutory provisions it is a punishable offence with imprisonment for a term which may extend to 3 years or with fine or with both. Therefore, we do not see any cogent reason to accept any plea taken by the petitioners that they could purchase the suit land even subsequent to Section 4 notification.
17. We do not find force in the submission made by Shri Kailash Vasdev, learned Senior Counsel that this Court had quashed the denotification of acquisition proceedings only on technical ground as the respondent Society was not heard. This Court in State Govt. Houseless Harijan Employees' Assn. v. State of Karnataka (2001) 1 SCC 610, AIR 2001 SC 437 held as under:
“72. From all this, the ultimate position which emerges is that the acquisition in favour of the appellant was properly initiated by publication of the notification under Section 4(1) and by the declaration issued under Section 6. The withdrawal of the acquisition under Section 48(1) was vitiated not only because the appellant was not heard but also because the reason for withdrawal was wrong. The High Court erred in dismissing the appellant's writ petition. The decision of the High Court is accordingly set aside. The impugned notification under Section 48(1) is quashed and the appeal is allowed with costs.”
(emphasis added)
18. There is ample evidence on record to show that possession of the suit land had been taken on 6-9-2002. In such a fact situation, question of denotifying the acquisition of land could not arise. Thus, the order dated 27-2-2004 could not be passed. There cannot be a dispute in law that upon possession being taken under Section 16 or 17 of the 1894 Act, the land vests in the State free from all encumbrances. Thus, in case possession of the land has been taken, application for release of land from acquisition is not maintainable. Once the land is vested in the State free from encumbrances, it cannot be divested. (See Lt. Governor of H.P v. Avinash Sharma (1970) 2 SCC 149, Satendra Prasad Jain v. State of U.P (1993) 4 SCC 369, Mandir Shree Sita Ramji v. Collector (LA) (2005) 6 SCC 745 and Sulochana Chandrakant Galande v. Pune Municipal Transport (2010) 8 SCC 467.)
19. In view of the above, we do not think it necessary to examine the other issues raised in the petitions particularly, the competence of the Hon'ble Minister to deal with the matter.
20. The petitions are devoid of any merit and are accordingly dismissed. However, it is made clear that the petitioners shall be entitled to compensation as determined under the provisions of the 1894 Act.
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