Andhra HC (Pre-Telangana)
Shyam Rao vs Land Acquisition Officer (Spl.) ... on 9 November, 1990
Equivalent citations: AIR1991AP219, 1991(1)ALT176, AIR 1991 ANDHRA PRADESH 219, (1992) 6 LACC 137, (1991) 1 APLJ 143, (1991) 1 ANDH LT 176
ORDER Jagannadha Rao, J.
1. The appellant Shyam Rao has preferred this writ appeal questioning the judgment of the learned single Judge in W.P. No. 16600/86 dated 5-7-1990 in so far as the learned Judge did not direct the respondents to deposit in Court the compen-sation of Rs. 1,74,756-94. That sum, according to the appellant, represents the compensation payable in respect of the land which is in dispute between the appellant and the respondents 2 to 7.
2. The notification was issued under S. 4(1) of the Land Acquisition Act (hereinafter referred to as the Act) on 16-10-1980 followed by a declaration under S. 6. In the award enquiry the appellant initially filed a claim petition on 12-8-81 laying claim to certain items covered by the notification. Subsequently, however, the appellant filed a second claim petition on 18-9-1986 claiming 50% of the compensation payable, claiming that the property is joint family property. The contesting respondents also filed a similar claim on 20-9-1986 claiming 50% of the compensation in respect of the lands exclusively claimed by the appellant but subsequently they withdrew the said claim on 22-9-1986. This was done without notice to the appellant. Thereafter the Land Acquisition Officer passed an award on 23-9-1986 rejecting the claim of the appellant as set out in the second claim petition dated 18-9-1986. Notices of the filing of the award were issued by the Land Acquisition Officer to the respondents on 30-9-1986 under Sec. 12(2) of the Act, while similar notices were served on the petitioner on 1-10-1986 as found by the learned single Judge. On 8-10-1986, even before the period of two months specified in Sec. 18(2)(b) (as in Andhra Pradesh) expired, the Land Acquisition Officer paid a sum of Rs. 4,55,717/- out of the total compensation of Rs. 5,61,915/- to the contesting respondents and paid only a sum of Rs. 1,06,203/- to the appellant. Thereafter on 3-11-1986 the appellant applied for a reference under S. 18 of the Act setting up the same title to the property which he has set up in his second claim petition dated 18-9-86. He filed another petition on 26-11-1986 for reference under S. 31. As there was no responce he filed the present writ petiton on 24-12-1986 seeking a writ of Mandamus to the 1st respondent to make a reference in respect of the award dated 23-9-1986 to the Civil court. He prayed for a further direction to the 1st respondent for deposit into Civil Court in a sum of Ru-pees 1,74,756-94 together with interest at 12% p.a. from 30-9-1986 till date of reference.
3. The learned single Judge allowed the appellant's writ petition in part and directed the Land Acquisition Officer to make a reference under S. 18 of the Act to the Civil Court. Though the appellant pleaded that the notice under S. 12(2) was served on him only on 14-10-86, the learned Judge found that it was actually served on 1-10-1986. However, the application for reference under S, 18 dated 3-11-1986 as well as the subsequent application dated 26-11-1986 filed under S.31 were both within two months from 1-10-1986, the learned single Judge made a reference. But so far as the relief of directing the Land Acquisition Officer to deposit a sum of Rs. 1,74,756-94 is concerned, the request is rejected. Aggrieved by the rejection by the learned single Judge of the request for re-deposit of the above said sum the applicant has filed the present appeal.
4. In this appeal it is contended by the learned counsel for the appellant, Sri M. Narender Reddy, that inasmuch as the appellant has raised a claim in respect of title in the proceedings before the Land Acquisition Officer, the latter should have deposited the entire compensation or at any rate the disputed part of the compensation in the civil Court under S. 31(1) of the Act so that the Court should decide the question of title finally and distribute the amount. Various rulings of the High Court have been relied upon. On the other hand it is contended by the learned Government Pleader as well as by Sri C. R. Pratap Reddy for respondents 2 to 7 that until the Civil Court decides the question of title and passes final orders in the reference no deposit can be directed as against the Land Acquisition Officer or as against the respondents 2 to 7. The distribution of money having been made as per the award, it is not permissible for this Court to issue any directions contrary to the award. In the event of the award being set aside it will be for the civil Court while disposing of the reference, to issue appropriate directions under the third proviso to S.31(2).
5. The point for consideration is: Whether the pending disposal of the O.P. by the Civil Court pursuant to the reference under S. 18, it is open to this Court to issue directions under Art. 226 of the Constitution of India directing the Land Acquisition Officer or the rival claimants to deposit in to Court the compensation referable to the disputed portion of the property?
6. Before going to the main question, it is necessary to notice the relevant provisions of the Land Acquisition Act, 1894.
7. Under S. 3(b), the expression 'person interested' includes all persons claiming an interest in the compensation to be made on account of the acquisition of land under the Act; and a person shall be deemed to be interested in land if he is interested in an easement affecting the land. Sec. 11 deals with the inquiry and award by the Collector. The Collector is to inquire into the objections which any 'person interested' has stated pursuant to a notice given under Sec. 9 to the measurement made under S. 8, and into the value of the land at the date of publication of the notification under S. 4(1), and into the respective interests of the persons claiming the compensation and he is to make an award under his hand (i) the true area of the land; (ii) the compensation which, in his opinion, should be allowed for the land and (iii) the apportionment of the said compensation among all the persons known or believed to be interested in the land of whom, or of whose claims, he has information, whether or not they have respectively appeared before him. Under S. 12(1), the Award of the Collector shall be final and conclusive evidence, as between the Collector and the persons interested whether they have respectively ap-peared before the Collector or not, of the true area and value of the land, and the apportionment of the compensation among the persons interested. Under S. 12 the Collector is to give immediate notice of award to such of the persons interested as are not present personally or by their representatives when the award is made.
8. Then comes the important provision contained in S, 18. It reads as follows :
"S. 18: Reference to Court :-- (1) Any person interested who has not accepted the award may, by written application to the Collector, require that the matter be referred by the Collector for the determination of the Court, whether his objection be to the measurement of the land, the amount of the compensation, the persons to whoin it is payable or the apportionment of the compensation among the persons interested.
(2) The application shall state the grounds on which objection to the award is taken, Provided that every such application shall be made
(a) if the person making it was present or represented before the Collector at the time when he made his award, within six weeks from the date of the Collector's award;
(b) in other cases, within two months from the date or service of the notice from the Collector under S. 12, sub-section (2)".
It will be noticed that the reference under ,S. 18 is not merely in respect of the quantum of compensation but could also be in respect of the measurement of the land, the persons to whom it is payable or the apportionment of the compensation among the persons interested. Reference could be made not only by persons present or represented before the Collector at the time when the award is made but also by others who receive notice of the filing of the award under S. 12(2).
9. There is one other provision which permits the making of a reference and that is contained in S. 30. It reads :
"S. 30 : Dispute as to apportionment : when the amount of compensation has been settled under S. 11, if any dispute arises as to the apportionment of the same or any part there-of or as to the persons to whom the game or any part thereof is payable, the Collector may refer such dispute to the decision of the Court".
10. The reference under S. 18 of the Land Acquisition Act, 1894 is not merely confined to the question of enhancement of compensation but may also be in respect of the measurement of the land, the persons to whom it is payable or the apportionment of the compensation among the persons interested. Under S. 18 the reference is at the instance of persons present or represented before the Collector at the time when the award is made or the persons on whom there is notice of the filing of the award under S. 12(2). Others could seek reference under S. 30. The Collector could also make a reference suo motu wherever he considered that complicated questions of fact and law are involved. However, a person covered by S. 18, who failed to seek a reference under S. 18 within the period of limitation cannot ask the Collector to exercise his powers under S. 30 nor could be file a suit. Only those not falling under S. 18, could seek a reference under S. 30 or file a suit, (see G. Venkata Reddy v. K. Krishna Rao, (Dr. G. H. Grant v. State of Bihar, .
11. Coming to the question of distribution of the compensation amount as per the award, it is provided in S. 31(1) that such distribution could be made by the Collector unless he is 'prevented' by some one or more of the 'contingencies' mentioned in sub-section (2) of S. 31. It is necessary to refer the contingencies mentioned in S. 31(2) :
"S. 31(2) :-- If they shall not consent to receive it, or if there be no person competent to alienate the land, or if there be any dispute as to the title to receive the compensation or as to the apportionment of it, the Collector shall deposit the amount of the compensation in the Court to which a reference under S. 18 would be submitted, Provided that any person admitted to be interested may receive such payment under protest as to the sufficiency of the amount.
Provided also that no person who has received the amount otherwise than under protest shall be entitled to make any application under S. 18, Provided also that nothing herein contained shall afffect the liability of any person, who may receive the whole or any part of any compensation awarded under this Act, to pay the same to the person lawfully entitled thereto".
Therefore, the three contingencies which 'prevent' payment by the Collector as per the award are : where the persons interested shall not consent to receive the compensation, where there is no person competent to alienate the land, and 'if there be' any dispute as to the title to receive the compensation or as to the apportionment of it.
12. It is argued for the respondents that once the award is made, the Collector is bound to tender payment in accordance with the terms of the award until the Civil Court while disposing of the reference under S. 18, sets aside or modifies the Collector's award. In our opinion, this submission cannot be accepted as it ignores the conditions laid down in S. 31(1). Under that sub-section payment could be made, 'unless prevented' by one or more of the contingencies mentioned! in sub-section (2) of S. 31.
13. As pointed out above, one of the contingencies referred to in S.31(2) can be said to have occurred 'if there be any dispute, as to title to receive the compensation or as to apportionment of it, such dispute arising in the course of the award inquiry itself. The words 'there be any dispute', in our view, do not mean that there must have arisen a fresh dispute after the passing of the award by the Collector. The contingency refers to the dispute which has already arisen in the award inquiry and in such a case, the Collector is statutorily 'prevented' from making any payment as per the award and he is bound to wait and see till the expiry of the period of limitation under S. 18(2), whether any of the parties to the award is not satisfied with the title to the compensation or its apportionment as decided by him. If any such reference is sought for under S. 18 to the civil Court, he is bound to deposit the compensation - at any rate, the disputed part of the compensation - in the civil Court along with the reference under S. 31(2). The idea is that the amount should be 'ready'for disposal as soon as the Civil Court, acting on the reference, decides the question of title and apportion-ment.
14. It is, however, argued that the words 'prevented' used in S. 31(1) and the words 'stop' used by the Division Bench of this Court in G. Venkata Reddy v. K. Krishna Rao, , meant that unless the Collector is 'prevented -or stopped' afresh, after the passing of the award, from distributing the compensation as per the award, he could distribute the same notwithstanding the existence of any of the contingencies in S. 31(2). In our view, this contention cannot be accepted. The 'prevention or the stoppage' of the distribution flows directed by force of the statute itself and no fresh action by the parties is contemplated. If there had been a dispute as to title or apportionment in the award inquiry the Collector cannot distribute the compensation amount on the basis of the award before the expiration of the period of limitation specified in S. 18(2).
15. If, however, the Collector has by mistake or otherwise, distributed the compensation as per the award and without obeying the mandate of S. 31(2), what is the remedy of the parties is the next question.
16. We shall refer to several important aspects that arise in connection with the procedure to be adopted by the reference Court for recovering back the disputed amount paid away by the Collector without deposit into Court in spite of the happening of the contingencies mentioned in S. 31(2) : Is it open to the Civil Court which is dealing with the reference, to exercise powers over the Collector and direct him to deposit the disputed amount in Court, if so, can the Court direct such a deposit only after disposal of the reference or as an interim measure pending disposal of the reference; can the Court issue such directions not merely to the Collector but also to the party who has received the disputed amount from the Collector; if the Court is to direct the Collector to make an interim deposit or a deposit at the time of disposal of the reference, what are the remedies of the Collector against the party to whom he has paid the disputed amount earlier; is the Court's power to direct deposit traceable to the main part of S. 31(2) and the incidental powers attributable to that power or to the inherent power of the Court; what is the purpose of the 3rd proviso to S. 31(2) and is it applicable only to cases of superior claims established in a suit or in any further reference under S. 30?
17. In our view, the answers to these issues can be arrived at by examining the legislative purpose of the main part of S. 31(2) itself. As pointed out by the Supreme Court in G. H. Grant v. State of Bihar, , the Collector's determination of the conflicting rights of the parties in the award is not final even in respect of the parties before the Collector in case a reference is sought for under S. 18(2). If the contingencies referred to S. 31(2) occur, he has a mandatory duty to make a reference and also to deposit the disputed compensation in the civil Court after waiting till the expiry of the period of limitation mentioned in S. 18(2) and in case a reference is sought for. The legislative in-tendment is" that the Court and not the Collector is to be the final arbiter of the question of title in the reference under S. 18, so far as the parties to the award are concerned. The scheme of the Act is therefore that the disputed amount must be deposited in the reference Court so that the Court could invest the same under S. 32 and then distribute the same to the parties as per its judgment, (subject of course to the other provisions of C.P.C.). The Collector cannot send an incomplete reference to the Court without sending the disputed amount to Court along with the reference. The Court therefore has the incidental power to direct the Coliector to deposit the money before it so that the reference could be made complete. We are therefore of the view that the power to issue directions to the Collector is clearly incidental to the provisions of the main part of Section 31(2).
18. Looking at the matter from another angle -- the purpose of the deposit being its availability for distribution at the time of disposal of the reference, the Court must be deemed to have inherent powers so as to make its final orders effective, efficacious and meaningful. Every Civil Court has inherent powers to pass interlocutory orders so that its final orders can achieve the real purposes for which they are intended, and here, the purposes of adjudication of rights and immediate distribution. Therefore the powers to direct deposit by the Collector pending the reference are incidental and inherent in the Court.
In fact, S. 53 of the Act states clearly that, save in so far as they are anything inconsistent -with the Act, the provisions of the Code of Civil Procedure shall apply to all proceedings before the Court under the Act. Under S. 26(2) the award is to be deemed a decree and the grounds therefor, a judgment. The Court dealing with the award, in our view, is not a Court of limited jurisdiction after the amendments to Ss. 26 and 53 by Act 19 of 1921. The Collector continues to be a party before the Court even after the reference and the Court can certainly issue appropriate directions to him. Such power being incidental and inherent, it will be for the Collector to initially make the interim deposit, if so directed by the Court and seek such remedies as are open to him under law to recover the amount from the party to whom he had made the excess payment. He cannot shift this burden to the Court or to the party who is to be ultimately successful before the reference Court.
The purpose behind the 3rd proviso to S. 31(2) is totally different. The award made by the Collector is subject to the decision or the reference if a reference is made under S. 18. The award of the Collector as well as the judgment of the Civil Court on reference, if any, under S. 18 are subject to decision in any suit or reference under S. 30, if such suit or reference are filed by persons who have not received notice under S. 9(2) and who for that reason could not participate in the award inquiry. The purpose of the 3rd proviso to S. 31(2) is to declare that the comperisation paid under the Act is subject to other liabilities of the persons so receiving the compensation, as may be adjudicated in a Civil suit or reference under S. 30, if such suit or reference are filed by persons not served with notice under S. 9(2).
19. Our view as stated above is consistent with the opinion expressed by a Division Bench of the Madras High Court in Deputy Collector, Cocoanada v. Maharaj of Pitta-pur, AIR 1926 Madras 492(1). That decision is in fact, binding on us. In that case, the Collector had paid away the disputed amount of compensation to one of the parties without depositing the same in the Civil Court. The Court no doubt did not direct any interim deposit but directed the Collector to deposit the amount into Court in view of its final decision in the reference. The Collector filed an appeal in the High Court contending that the Court had no such power and that, in any event, in view of the 3rd proviso to S. 31(2), the Court should have directed the party who has received the excess payment, to redeposit the same in Court. Rejecting the said contentions Wallace and Madhavan Nair, JJ. observed that the direction granted by the Civil Court, at the time of disposal of the reference was correct. The Collector ought to have made the deposit along with the reference and kept it ready for disbursement by the Court and by failing to do so, he could not be in a better position. The inference is that the Madras High Court accepted that the Civil Court had such power under the main part of S. 31(1). This is made further clear from the view expressed by the learned Judges that the 3rd proviso to S. 31 was not applicable in such situations. It was applicable only if "S. 31(2) itself has been obeyed" i.e., where the Collector has made a deposit as per S. 31(2) and the Court has paid away the amount as per its judgment. Obviously, the claim, in such cases, for purposes of the 3rd proviso, could be only by persons who are not before the reference Court, such as those who have filed a Civil suit, having not received notices under S. 9(2) or who have got a reference made under S, 30 later. We may add, that such persons could rely on the proviso even where the distribution is by the Collector and there has been no reference under S. 18. The judgment of the Madras High Court which accepts the power of the Civil Court to direct deposit at the time of disposal of the reference, leads also to the conclusion that the Court has an incidental or inherent power to direct an interim deposit by the Collector, pending reference, so that the money is readily available for distribution by the Court later.
20. The Division Bench of the Patna High Court in Ramhit v. Mahadeo, AIR 1920 Pat 222 (2) has held that the District Collector cannot be said to have no jurisdiction to decide the reference merely because the Collector had not deposited the money into Court. After referring to the mandatory language of S. 31(2), the learned Judges observed that the idea was that the money is kept ready in the Court for disposal. They observed that the District Judge had also a right to demand that the deposit of the money be made in the Court and insist on the same being so deposited.
21. The Punjab and Haryana High Court in Jog Raj v. Banarsi Das, AIR 1978 Punj & Har 189 resolved the issue by adjusting the excess payment made by the Collector from out of the enhanced compensation payable to that party by the Civil Court.
22. The Madhya Pradesh High Court, in Hitkarini Sabha v. Jabalpur Corporation, has also upheld the power of the Civil Court to direct an interim deposit in the Court, pending disposal of the reference, so that the money is kept ready for disposal. Hidyatullah, C.J. (as he then was) speaking for the Bench observed that it was open to the Court to direct the party who has received the disputed money, to make the deposit into Court, for being dealt with immediately after its judgment. For that purpose, the Court relied upon the principle, that an act of Court should not prejudice any parly and applied the principle to the actions of the Collector. In our view, it is not necessary to resort to the above principle so far as the Collector's action is concerned.
23. We arc also of the view, that the proper course is to direct not the party but the Collector, either as an interim measure or at the time of disposal of the reference by '' z Court, to deposit the disputed amount with the Civil Court leaving it to the Collector to take such steps as he may deem fit in order to secure the interests of the State. Firstly, the Collector who is the person at fault must bear the responsibility. He cannot, as pointed out by the Madras High Court in Deputy Collector, Coconada v. Raja of Pittapur (AIR 1926 Mad 492 (1)), shift the risk or burden of recovering the disputed amount, to the reference Court or to those who succeed in the reference. Secondly, the legislative purpose of keeping the money for ready disposal by the Court is not likely to be achieved if the Court is to try to recover the amounts from the party. Thirdly, laying down such a principle is likely to result in more and more unauthorised and unwarranted disposals by the Collectors leading to uncertainty, prolonged litigation and lack of discipline. If the Collectors are made to deposit the monies in Court pending reference, the State will be in a position to keep track of such cases and if it thinks that the distribution of the monies was not for good reason but on account of any corrupt motives or misconduct, it could take action forthwith. Therefore we are of the view that the proper course would be for the Court to direct the Collector to deposit the monies into Court.
24. However, the Rangoon High Court in K.N.K.R.M.K. Chettyar Firm v. Secretary of State, AIR 1933 Rangoon 176 has held that the Court cannot direct the Collector to deposit the amount into Court unless there is negligence on his part and that the court cannot also go ito the question of negligence. A Full Bench of the Lahore High Court has held in Abdul Sattar v. Hamida Bibi, AIR 1950 Lahore 229 that it is not open to the Court to recall the money. Similar observa-
tions are also made by the Calcutta High Court in Gobindaranee v. Binda Ranee Dases (1908) ILR 35 Call 104 : 12 Cal WN 1039. We respectfully dissent from the above judgments of the Rangoon, Lahore and Calcutta High Courts.
25. One other class of cases, however, presents nadifficulty. Persons concerned who have not received notice under S. 9(2) can file suits to recover the amount of compensation due to them against the State as well as the parlies who have earlier received the same from the Collector and recover the same by invoking the 3rd proviso to S. 31(2). (Vide Birendra Nath v. Mritunjoy, ; Shivmal v. Ramachandra Bapu, AIR 1933 Nagpur 322; State of M.P. v. Sugandhi, .
26. For the reasons given above, we hold that this is a fit case not only to direct the 1st respondent to make the reference under S. 18 but also lo direct him to deposit in Court the sum of Rs. 1,74,756-94 in the Civil Court, along with the reference or, if the reference has already been made as directed by the learned single Judge, within two months from the dale of receipt of this order. We accordingly so direct. After the amount is deposited, it shall be open to the Civil Court to invest the amount as per S. 32 of the Act. In case the claim of the appellant is negatived by the Civil Court it is needless to say that the Collector/L.A.O, is entitled to withdraw the amount from Court with interest accrued (hereon. It shall also be open to the Collector to take appropriate steps against respondents 2 to 7 either to get back the disputed amount of Rs. 1,74,756-94 from them or to ask them to furnish security. He can also apply to the reference Court for appropriate orders with regard to recovery of amount from respondents in case such need arises in the light of Civil Court's judgment. The direction given by the learned single Judge to the 1st respondent to make a reference shall continue to remain in force. The writ appeal is allowed as stated above. There will be no order as to costs. Advocate's fee Rs. 250/-.
27. Order accordingly.