Supreme Court Rules Acquisition Proceedings Not Lapsed If Possession Taken or Compensation Paid

07 May 2024 8:19 AM

By: Admin

In a landmark judgment, the Supreme Court of India has ruled that acquisition proceedings under the Land Acquisition Act, 1894, do not lapse if possession of the land has been taken or compensation has been paid. The decision came in the case of National Capital Territory of Delhi & Anr. vs. Subhash Chander Khatri & Ors., where the High Court of Delhi had declared the acquisition proceedings as lapsed due to non-payment of compensation. The Supreme Court, overturning the High Court's decision, held that the acquisition should continue and compensation must be determined as per the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.

The Constitution Bench, in its ruling, observed, "The deemed lapse of land acquisition proceedings under Section 24(2) of the 2013 Act takes place where due to inaction of authorities for five years or more prior to the commencement of the said Act, the possession of land has not been taken nor compensation has been paid. In other words, in case possession has been taken, compensation has not been paid, then there is no lapse."

The Court emphasized that the previous decision in Pune Municipal Corporation vs. Harakchand Misirimal Solanki case, which had been relied upon by the High Court, had been overruled. Instead, the Court referred to the Indore Development Authority vs. Manoharlal and Ors. case, stating that compensation should be determined under the provisions of the Act, 2013.

In the present case, it was established that the possession of the subject land had been taken and it had been put to use for the construction of Bankner Link Drain. Consequently, the Supreme Court held that there was no lapse of the acquisition with regard to the subject land, setting aside the High Court's judgment.

The ruling clarifies that possession and payment of compensation are crucial factors in determining whether an acquisition has lapsed or not. It provides much-needed clarity and a consistent approach to land acquisition proceedings under the Act, 2013, and establishes a precedent for future cases.

Date of Decision: February 24, 2023

National Capital Territory of Delhi & Anr. vs Subhash Chander Khatri & Ors.