Andhra HC (Pre-Telangana)
Union Of India (Uoi) Rep. By General ... vs Land Acquisition Officer And Revenue ... on 21 October, 1997
Equivalent citations: 1997(6)ALT529
ORDER D.H. Nasir, J.
1. The General Manager, South Central Railway, Secunderabad has filed this Writ Petition No. 8425/96 seeking a Writ of Mandamus to be issued declaring as illegal the Award No. 3/95 dated 13-3-1995 of the Land Acquisition Officer/ 5 Revenue Divisional Officer, Tirupati and also for issuing a direction to the first respondent to allow the petitioner to make his representations in respect of the assessment of the market value of the land under acquisition to determine the compensation payable under the Land Acquisition Act on that basis.
2. The land under acquisition comprises of Ac.4-87 of land in Tirupati behind railway station for construction of staff quarters at Tirupati.
3. The proposition that the petitioner as the beneficiary of the land under acquisition is required to be heard by the concerned authority before awarding any compensation to the landowners, is seriously disputed not only by the land owners being respondents 2 to 12 but also by the first respondent Land Acquisition Officer. The fifth respondent on his behalf and on behalf of the other respondents who claim to be the land owners, in his counter-affidavit disputes the maintainability of the writ petition on the ground that the writ petitioner was already a party to Writ Petition Nos. 17048/88,18554/88 and 8550/90 which were filed by the landowners on account of the fact that the present writ petitioner had not paid the compensation amount. By an order dated 6-10-1994 the High Court was pleased to direct the Land Acquisition Officer to pass appropriate award within a period of three months from the date of order and to submit the copies of the award in the Court by 25 20-1-1995. However, the present writ petitioner absented itself before the Land Acquisition Officer and did not raise any objections before him and therefore the writ petitioner was not entitled to be heard in the present writ petition and on that ground, according to the respondents, the writ petition was liable to be dismissed summarily. Many other contentions and objections have been raised in the counter-affidavit on the merits of the amount awarded as compensation. However, for the purpose of deciding the present writ petition the same, in my opinion, are not relevant, inasmuch as the controversy between the parties revolves round the predominant question whether the beneficiary of the land under acquisition is at all required 10 be heard before passing the award. The answer to this question would decide the fate of this writ petition.
4. The respondent-land owners also dispute the maintainability of this writ petition on the ground that it suffers from the principles of laches and estoppel because the award was passed on 13-3-1995 which, according to the respondent was communicated to the writ petitioner immediately. The present writ petitioner kept quiet for one full year after the declaration of the award and this was done, according to the respondents, with a mala fide intention of protracting the proceedings and creating obstacles in the way of the respondents to receive the compensation. The allegation made by the writ 45 petitioner that there was a collusion between the first respondent (Revenue Divisional Officer/Land Acquisition Officer, Tirupati) and the remaining respondents, is also vehemently denied by the respondents. The respondents decry the attitude adopted by the writ petitioner avoiding to pay the market value after taking possession of the land in question. For all these reasons, therefore, according to the respondents 2 to 12 the writ petition should be dismissed.
5. The writ petitioner has attempted to deal with the contentions raised by the respondents, by filing additional affidavit on 8-7-1996 in which it is contended apart from disputing the legality of the compensation arrived at by the Land Acquisition Officer that the Writ Petition No. 19721/95 filed by the respondents 2 and 12 was barred by the doctrine of res judicata and constructive res judicata as the respondents had already filed earlier Writ PetitionNos.17048/88,18554/88 and8550/90which were decided by the High Court on 6-10-1994 for similar reliefs. Further, according to the writ petitioner, Writ Petition No. 19721/95 was also barred by the principles enunciated in Order II Rule 2 of the Code of Civil Procedure, 1908.
6. On the question of eligibility of the beneficiary of the land acquisition proceedings to be heard during the enquiry before passing the award several authorities have been cited by the rival parties so as to enable the Court to arrive at a conclusion whether the present writ petition is maintainable or relief could be granted in favour of such beneficiary as prayed for in the present writ petition.
7. The Supreme Court approved of this proposition in Neyvely Lignite Corporation Limited v. Special Tahsildar (Land Acquisition), Neyvely, by holding that the beneficiary has the right to be heard by the Collector or the Court, and if the compensation is enhanced it is entitled to canvass the correctness of the original compensation by filing an appeal or defend the award of the Collector, and if there is no right of hearing or appeal given to the beneficiary and if the State does not file the appeal or if filed, with delay, and the same is dismissed, it is the beneficiary who bears the burden of the compensation and as such would be the affected person. It is observed by the Supreme Court that in cases where the beneficiary for whose benefit the land is acquired is served with the notice and brought on record at the stage of enquiry by the Collector and reference Court under Section 18 or in an appeal under Section 54, the beneficiary would be interested to defend the award under Section 11 or Section 26, and as a necessary party or proper party affected by the determination of higher compensation, the beneficiary must have a right to challenge the correctness of the award made by the reference Court under Section 18 or in appeal under Section 54 etc. The Supreme Court further held that if it is not made a party, it is entitled to seek leave of the Court and file the appeal against the enhanced award and decree of the Civil Court under Section 26 or against the judgment and decree under Section 54 or is entitled to file writ petition under Article 226 and assail its legality or correctness.
8. The same view is expressed by the Supreme Court in U.P. Awas Evam Vikas Parishad v. Gyan Devi, (D.N.). The Constitution Bench of the Supreme Court presided over by M.N. Venkatachalaiah, C.J.I., by majority per R.M. Sahai - J held as follows:
"(1) Section 50(2) of the L.A. Act confers on a local authority for whom land is being acquired a right to appear in the acquisition proceedings before the Collector and the reference Court and adduce evidence for the purpose of determining the amount of compensation.
(2) The said right carries with the right to be given adequate notice by the Collector as well as the reference Court before whom acquisition proceedings are pending on the date on which the matter of determination of compensation will be taken up.
(3) The proviso to Section 50(2) only precludes a local authority from seeking a reference but it does not deprive the local authority which feels aggrieved by the determination of the amount of compensation by the Collector or by the reference Court to invoke the remedy under Article 226 of the Constitution as well as the remedies available under the L.A. Act.
(4) In the event of denial of the right conferred by Section 50(2) on account of failure of the Collector to serve notice of the acquisition proceedings the local authority can invoke the jurisdiction of the High Court under Article 226 of the Constitution.
(5) Even when notice has been served on the local authority the remedy under Article 226 of the Constitution would be available to the local authority on grounds on which judicial review is permissible under Article 226.
(6) The local authority is a proper party in the proceedings before the reference Court and is entitled to be impleaded as a party in those proceedings wherein it can defend the determination of the amount of compensation by the Collector and oppose enhancement of the said amount and also adduce evidence in that regard.
(7) In the event of enhancement of the amount of compensation by the reference Court if the Government does not file an appeal, the local authority can file and appeal against the award in the High Court after obtaining leave of the Court.
(8) In an appeal by the person having an interest in land seeking enhancement of the amount of compensation awarded by the reference Court the local authority should be impleaded as a party and is entitled to be served notice of the said appeal. This would apply to an appeal in the High Court as well as the Supreme Court.
(9) Since a company for whom land is being acquired has the same right as a local authority under Section 50(2), whatever has been said with regard to a local authority would apply to a company too.
(10) The matters which stand finally concluded will, however, not be reopened.".
There can, therefore, be no doubt about the fact that the beneficiary enjoys an unassailable right to participate in the award proceeding and to have its objections considered and determined with regard to the conclusion which may be arrived at by the Land Acquisition Officer for determining the correct market value of the property under acquisition and to arrive at compensation which could be awarded to the land owners.
9. On the other hand the learned Counsel for the respondents pressed into service the decision of the Supreme Court in Santosh Kumar v. Central Warehousing Corporation, in which the Supreme Court observed in paragraph 4 as follows:
"In our view there cannot be any possible doubt that the scheme of the Act is that, apart from fraud, corruption or collusion, the amount of compensation awarded by the Collector under Section 11 of the Act may not be questioned in any proceeding either by the Government or by the Company or Local authority at whose instance the acquisition is made. Section 50(2) and Section 25 lead to that inevitable conclusion. Surely what may not be done under the provisions of the Act may not be permitted to be done by invoking the jurisdiction of the High Court under Article 226. Article 226 is not meant to avoid or circumvent the processes of the law and the provisions of the statute. When Section 50(2) expressly bars the company or local authority at whose instance the acquisition is made from demanding a reference under Section 18 of the Act, notwithstanding that such company or local authority may be allowed to adduce evidence before the Collector, and when Section 25 expressly prohibits the Court from reducing the amount of compensation while dealing with the reference under Section 18, it is clearly not permissible for the company or the High Court under Article 226 to challenge the amount of compensation awarded by the Collector and to have it reduced."
What is highlighted by the Supreme Court in the above case is the absence of right of moving the authority for making a reference to Section 18 of the Land Acquisition Act to Civil Court for enhancement of the compensation which, indeed is prohibited under the proviso to sub-section (2) of Section 50 of the Act, which provides that in any proceeding held before a Collector or Court the local authority or Company concerned may appear and adduce evidence for the purpose of determining the amount of compensation. In the concluding part of paragraph 4 of the judgment in Santosh Kumar's case, , it is observed that it was not permissible for the Company or local authority to invoke the jurisdiction of the High Court under Article 226 to challenge the amount of compensation awarded by the Collector so as to have it reduced.
10. The minority view in U.P. Awas case (supra) while dealing with the decision of the Supreme Court in Santosh Kumar's case (supra) made the following observations in the concluding part of paragraph 43:
"In Santosh Kumar v. Central Warehousing Corporation, it was held that the company or the local authority at whose instance the acquisition is made is not entitled to challenge the determination of compensation except on the ground of fraud, corruption or collusion and therefore, it is in the interest of the person whose land has been acquired that the necessary intimation should be given to the acquiring body at the earliest so that it may not raise the plea of fraud, corruption or collusion after conclusion of the proceedings either before the Court or in appeal. But the obligation of the Collector or the Court to issue notice shall be prospective in operation. That is it shall apply to only those proceedings which are initiated hereinafter or are pending before the Collector or Court. It shall not be available in appeals pending against the order passed in reference in High Court or this Court except in those rare cases where the local authority is able to establish that it had no knowledge about the proceedings at any stage and the proceedings were vitiated because of fraud or collusion."
11. Thereafter in Paragraph No. 44 the Supreme Court (minority decision) in U.P. Awas case (2nd cited supra) recorded the conclusions arrived at as follows:
"(i) An acquiring body including local authority or company is not a necessary party either before the Collector who makes the award or before the Court which hears the reference.
(ii) Any proceeding for determination of compensation is not vitiated nor is liable to be set aside for non-impleadment or non-issuance of notice to the acquiring body, including local authority or the company,
(iii) (a) The Collector and the Court hereinafter shall be under an obligation to intimate the local authority or the company of pendency of the proceedings to enable it to lead evidence.
(b) Non-appearance by the local authority or company in pursuance of notice sent by Collector would not absolve the reference Court from issuing any notice.
(iv) (a) If a local authority or company appears in proceedings and leads evidence as provided by sub-Section (2) of Section 50 in proceedings which were initiated earlier it shall be made party in subsequent proceedings and its non-impleadment shall render the proceedings invalid.
(b) But if the local authority or the company on whom notice was served or it had knowledge of the proceedings but it did not appear then it shall not be entitled to claim at a later stage or in appeal that the proceedings were vitiated due to its non-impleadment.
(v) Any proceeding taken under the L.A. Act as amended by the State law or if specifically provided in the State enactment under which the land is being acquired providing for issuance of notice or giving an opportunity of hearing is required to be followed and if such notice is not issued or hearing is not afforded then the proceedings as in the Karnataka Act or in the Krishi Upaj Mandi Samithi Adhiniyam referred to earlier are liable to be set aside.
(vi) In appeal pending in the High Court or this Court the local authority or the company shall not be entitled to claim setting aside of the order except if it establishes fraud or collusion. No order shall be set aside on the ground if it is only in the realm of appreciation of evidence."
Obviously, the majority view is binding on this Court and therefore the writ petitioner's case receives ample support.
12. Two factors, viz., 'knowledge' and 'laches' however, still survive for our consideration before arriving at a final conclusion. There can be no denial of the fact that the writ petitioner was aware of the proceedings taken by the land owners by filing Writ Petition Nos. 17048/88, 18554/88 and 8550/90 in which the Division Bench of this High Court by order dated 6-10-1994 directed the Land Acquisition Officer/Revenue Divisional Officer, Tirupati, to pass an award within a period of three months and eventually the award was passed on 13-3-1995 after obtaining extension from the High Court. The Writ Petitioner itself has produced a copy of the common order passed by the Division Bench of this High Court in the afore-said Writ Petitions. It is evident that the Union of India represented by the General Manager, South Central Railway, Secunderabad, has been pleaded as respondent in all the above three writ petitions. A reference is also made in the common order passed by the Division Bench that the copy of the award should be furnished to the Union of India represented by South Central Railway so as to enable it to deposit the amount of compensation so awarded if not already deposited.
13. The Railways, therefore, had sufficient knowledge right from 1988 onwards when the first Writ Petition No. 17048/1988 was filed by the land owners for quick disposal of the award proceedings. The railways in fact could be treated as having the knowledge of the land acquisition proceedings right from the date when the railways itself moved the Government for the acquisition of the land in question because the same was required for the purpose of the railways. It is not understandable how the railways chose to intervene by filing W.P.No.8425 of 1996 (present Writ Petition) only after the award was passed. The railways do no come forward with any excuse that they were not conscious of their right of intervening in the proceedings for determining the compensation payable to the land owners. In my opinion, therefore, the conduct of the railways is inexplicable and unexcusable. It was highly unjust on part of the railways to intervene at the stage of the proceedings when the liability of depositing the amount payable by way of compensation to the land owners had crystalised and was intimated by the Land Acquisition Officer to the railways.
14. It is also not disputed by the railways that they were called upon by the Land Acquisition Officer to deposit a sum of Rs. 1.33 crores by letter dated 13-1-1995 but instead of complying with the demand, the railways by its reply dated 21-5-1995 raised a grievance before the first respondent that it had not been given an opportunity of being heard before determining the compensation payable to the land owners. According to the petitioner, the quantum of compensation determined by the 1st respondent was very much on high side and was not in accordance with the prevailing market value as on 21-5-1981 on which the notification under Section 4(1) and Declaration under Section 6 of the Act was issued. However, the petitioner did not make any allegation of fraud or collusion in the affidavit filed on 18-4-1996 in support of the present writ petition. Subsequently, however, on 8-7-1996 the railways filed an additional affidavit sworn by Vijay Agarwal working as Senior Divisional Engineer, Co-ordination, South Central Railway, Guntakal in which it is stated in para 1 that the 1st respondent by his letter dated 13-1-1995 called upon the writ petitioner to deposit a sum of Rs. 1.33 crores towards compensation payable to the land owners and it was revealed from the said letter that the 1st respondent called respondents 2 to 12 for discussion on 10-1-1995 in respect of assessment of compensation and that respondents 2 to 12 claimed compensation at Rs. 1,000/- per square yard including solatium on additional market value and interest and ultimately agreed to receive Rs. 900/- per square yard which was based upon the value of the land as reflected in the Basic Valuation Register maintained in the Sub-Registrar's office, Tirupati. The 1st respondent opined that the market value of Rs. 900/- per square yard was quite reasonable and relying upon the basic Valuation register called upon the railways to deposit the said sum of Rs. 1.33 crores towards compensation. This letter, according to the Divisional Engineer- Vijay Agarwal, clearly demonstrated that the first respondent had colluded with respondents 2 to 12 in arriving at the alleged market value of the said land under acquisition without independently applying his mind to the assessment of the market value of the said land with reference to the sale transaction which took place within three years prior to the notification dated 25-4-1981.
15. The allegation of collusion which is sought to be made out from the aforesaid communication between the railways and the first respondent cannot easily be inferred or deduced from the material which came on record. In fact, this allegation seems to be an after-thought so as to cover up the lacunae left in the first affidavit for the purpose of making out a prima facie case in the writ petition. However, in my opinion, this allegation made in the additional affidavit is grossly insufficient for arriving at even a prima facie conclusion that an element of collusion could be seen between the Land Acquisition Officer and the land owners.
16. A note is also required to be taken of the fact that even after receipt of communication from the Land Acquisition Officer by letter dated 13-1-1995 to deposit a sum of Rs. 1.33 crores towards compensation, the railways took more than 15 months to file this Writ Petition without explaining how and why the delay of as many as 15 months took place in filing the writ petition, which gives the colour of laches to the action taken by the railways.
17. Therefore, in spite of the fact that the right of the beneficiary could not be denied to participate in the award proceedings so as to ensure that the minimum possible amount was awarded as compensation, the bona fides on part of the railways in urging such right by the present writ petition suffers a serious set-back on account of the infirmities produced by in-action on part of the railways in spite of the knowledge at the relevant time and on account of delay of 15 months in filing the present writ petition as well as the allegation of collusion made as an after-thought without any reasonable ground to do so.
18. In U.P. Awas's case (supra), the Supreme Court in its majority view observed in paragraph 9 that the right to appear in the acquisition proceedings before the Collector and adduce evidence for the purpose of determining the amount of compensation would be effectively exercised by the local authority only if it has information of the proceedings which are pending before the Collector as well as the reference Court and unless it could be shown that the local authority had 'knowledge' about the pendency of the acquisition proceedings before the Collector or the reference Court and had not suffered any prejudice on account of failure to give such notice. In paragraph 20, the Supreme Court observed that the proviso to Section 50(2) only took away the remedy of a reference under Section 18 of the L.A. Act. Examining this question in the context of the proceedings before the Collector, the Supreme Court observed that the following situations could be envisaged:-
"(i) No notice was given to the local authority under Sub-section(2) of Section 50 of the L.A. Act and as a result the local authority could not appear before the Collector or adduce evidence;
(ii) Notice was served on the local authority and in response to said notice the local authority appeared before the Collector; and
(iii) Notice was served on the local authority but in spite of service of such notice the local authority failed to appear and adduce evidence before the Collector."
With the above situations in view, the Supreme Court observed in the concluding part of paragraph 21 that in a case where the local authority failed to appear in spite of service of notice, the local authority could not have any cause or grievance. In the instant case though no notice had been served, the petitioner-railways cannot deny 'knowledge' which was also a relevant factor as held by the Supreme Court in the above case and, therefore, the petitioner could not be permitted to be heard on any grievance against the compensation determined by the Land Acquisition Officer.
19. The Supreme Court also observed in para 21 of the Awas's case (supra) that even in such a case it may be permissible for the local authority to invoke the jurisdiction of the High Court under Article 226 of the Constitution of India to assail the award if it was vitiated by mala fides or was perverse. On the basis of this observation of the Supreme Court, this Writ Petition under Article 226 of the Constitution could have merited the judicial review of the award if at all the railways had succeeded in impressing upon the Court that the award was vitiated by mala fides or was perverse. There is no pleading to this effect in the writ petition. However, only by way of an after-thought, the railways have made a feeble attempt to assail the award by making an unsubstantiated allegation of collusion. The allegation of the award being perverse does not find place at all the writ petition.
20. With the above situation in view though no notice was served upon the writ petitioner (railways) for participating in the award proceedings, the writ petitioner cannot take advantage of the decision of the Supreme Court in U.P. Awas's case (supra) largely on account of the fact that the requirement of notice was served by specific 'knowledge' of the present writ petitioner as also on account of the principles of laches not having been satisfactorily explained. The railways therefore cannot be treated as entitled to annulment of the award for the purpose of giving the opportunity of being heard to the railways.
21. In view of the facts and circumstances of the case before us being stated above, and having regard to the position of law, the Writ Petition No. 8425 of 1996 filed by the railways deserves to be dismissed and it is hereby dismissed. As a direct consequences of this decision, the writ petition No. 19721 of 1995 filed by the land owners is allowed and the respondents-authorities are directed to take necessary steps forthwith in accordance with law and to pay the amount awarded as compensation to the writ petitioners. No costs.