Allahabad High Court
Sursati vs State Of U.P. And 4 Others on 22 January, 2020
Bench: Bala Krishna Narayana, Ravi Nath Tilhari
HIGH COURT OF JUDICATURE AT ALLAHABAD A.F.R. Court No. - 4 Case :- WRIT - C No. - 30608 of 2018 Petitioner :- Sursati Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Ajay Kumar Singh Counsel for Respondent :- C.S.C.,Devendra Kumar,Pramod Kumar Pandey Hon'ble Bala Krishna Narayana,J.
Hon'ble Ravi Nath Tilhari,J.
(Per Justice Ravi Nath Tilhari)
1. Heard Sri Ajay Kumar Singh, learned counsel for the petitioner, learned Standing Counsel for Respondent Nos. 1 to 5 and Sri Devendra Kumar, learned Counsel for National Highways Authority of India, Respondent No.6.
2. The petitioner has filed this petition for the following main reliefs:-
"(A) Issue an appropriate writ order or direction in the nature of mandamus commanding the respondents and directing them (specially respondent No.3 and 5) to decide the claim of the petitioner regarding to ensure the payment of compensation with respect of Arazi No. 535 area 0.0580 hectare which is acquisition the land of the petitioner.
(B) Issue an appropriate writ order or direction in the nature of mandamus commanding the respondents and directing them to decide the representation of the petitioner within stipulated period, which is pending before the respondent No.3 and 5 since 24th February, 2018."
3. Facts of the case are that one Smt. Ram Dulari widow of late Pataru son of Sugriv executed a sale deed dated 21.1.2016 in favour of petitioner for an area of 0.430 hectare out of 0.05804 hectare of gata No. 535 situated in Mauja Pirthipur, Pargana Pachotar, District Ghazipur. On the basis of the said sale deed the petitioner's name was recorded as Bhumidhar in the revenue records on 11.3.2016. Later on, the petitioner acquired knowledge that the land of gata No. 535, purchased by her had already been acquired vide notification under Section 3D of the National Highways Act, 1956. In the notification annexed as Annexure No.3 the name of the original land holder was mentioned in Column 34. The petitioner filed many applications for correction of her name in place of the name of transferor and for payment of compensation for the acquired land to the petitioner in view of the sale deed but the payment has yet not been made.
4. The Repondent Nos. 1 to 5 have set up the case that the Government of India issued two notifications dated 1.12.2014 and 27.11.2015 under Section 3A and 3D of the National Highways Act, 1956, for widening of National Highway No. 29, by which the aforesaid land was also acquired. The petitioner purchased the land in question on 22.1.2016 after publication of the notification and as such the sale deed being void ab initio, the petitioner has no right to claim compensation, hence, the representation of the petitioner is of no consequence.
5. The Project Director National Highways district Gorakhpur has taken a stand that the role of the National Highways Authority of India in respect of land acquisition is limited to the depositing of the awarded amount of compensation with the competent authority. It has also taken a stand that the petitioner's sale deed dated 21.1.2016 is illegal and it is for the competent authority to act according to law.
6. Smt. Ram Dulari, the petitioner's transferor Respondent No.7, having died during pendency of the writ petition, was substituted by her grand son Respondent No. 7/1 who has stated in the counter affidavit that the petitioner is entitled for payment of compensation of the acquired land which was transferred to the petitioner and for payment of such compensation to the petitioner he has no objection.
7. Learned counsel for the petitioner has argued that the petitioner having purchased the land from its tenure holder, may be after the notification under Section 3D of the Act 1956, is entitled for payment of compensation which is being denied illegally by Respondent Nos.1 to 5. He has submitted that the subsequent purchaser has also a right to receive compensation of the acquired land on the strength of the vendor's title. He has placed reliance on the judgment passed by a coordinate Bench of this Court in the case of Surendra Nath Singh Yadav Vs. Union of India decided on 16.1.2018 reported in 2018 (2) ADJ 768.
8. Per contra, learned Standing Counsel for respondent Nos. 1 to 5 and Sri Devendra Kumar learned counsel for Respondent No. 6 have submitted that the subsequent purchaser of the land acquired under the National Highways Act 1956, has no right to claim or receive compensation on the strength of the sale deed after declaration under Section 3-D(2), which is void ab initio. They have placed reliance on the judgment of this Court by other coordinate Benchs in the case of Asha Devi Vs. National Highways Authority of India and four others Writ C No. 9874 of 2018 (DB) decided on 16.3.2018; the case of Smt. Gyanti Singh Vs. State of U.P. and others Writ C No. 12158 of 2018 (DB) decided on 3.5.2018 and the case of Vipin Agrawal Vs. Union of India Writ C No. 10958 of 2018 (DB) decided on 27.3.2018.
9. We have heard the submissions advanced by the learned counsel for the parties and have thoroughly considered the judgments cited from both the sides.
10. The short question involved in the present writ petition is "whether the petitioner who is a subsequent purchaser vide sale deed dated 21.1.2016 after the date of notification for acquisition of land under Section 3-D (1) of the National Highways Act, 1956, has a right to claim and receive compensation of the acquired land from the State?
11. It is relevant to reproduce Sections 4, 5A, 6, 9, 11 and 17 of the Land Acquisition Act, 1894 as under:
"4. Publication of preliminary notification and powers of officers thereupon:
(1) Whenever it appears to the appropriate Government that land in any locality is needed or is likely to be needed for any public purpose or for a company a notification to that effect shall be published in the Official Gazette and in two daily newspapers circulating in that locality of which at least one shall be in the regional language, and the Collector shall cause public notice of the substance of such notification to be given at convenient places in the said locality the last of the dates of such publication and the giving of such public notice, being hereinafter referred to as the date of publication of the notification.
(2) Thereupon it shall be lawful for any officer, either, generally or specially authorised by such Government in this behalf, and for his servants and workmen, to enter upon and survey and take levels of any land in such locality; to dig or bore in the sub-soil; to do all other acts necessary to ascertain whether the land is adapted for such purpose; to set out the boundaries of the land proposed to be taken and the intended line of the work (if any) proposed to be made thereon; to mark such levels, boundaries and line by placing marks and cutting trenches; and, where otherwise the survey cannot be completed and the levels taken and the boundaries and line marked, to cut down and clear away any part of any standing crop, fence or jungle:
Provided that no person shall enter into any building or upon any enclosed court or garden attached to a dwelling-house (unless with the consent of the occupier thereof) without previously giving such occupier at least seven days' notice in writing of his intention to do so.
5A. Hearing of objections. (1) Any person interested in any land which has been notified under section 4, sub-section (1) as being needed or likely to be needed for a public purpose or for a Company may, within thirty days from the date of the publication of the notification, object to the acquisition of the land or of any land in the locality, as the case may be.
(2) Every objection under sub-section (1) shall be made to the Collector in writing, and the Collector shall give the objector an opportunity of being heard in person or by any person authorised by him in this behalf or by pleader and shall, after hearing all such objections and after making such further inquiry, if any, as he thinks necessary, either make a report in respect of the land, which has been notified under section 4, sub-section (1) or make different reports in respect of different parcels of such land, to the Government containing his recommendations on the objections, together with the record of the proceedings held by him, for the decision of that Government. The decision of the appropriate Government on the objections shall be final.
(3) For the purposes of this section, a person shall be deemed to be interested in land who would be entitled to claim an interest in compensation if the land were acquired under this Act.
6. Declaration that land is required for a public purpose.
(1) Subject to the provisions of Part VII of this Act, when the appropriate Government is satisfied, after considering the report, if any, made under section 5A, sub-section (2), that any particular land is needed for a public purpose, or for a Company, a declaration shall be made to that effect under the signature of a Secretary to such Government or of some officer duly authorised to certify its orders and different declarations may be made from time to time in respect of different parcels of any land covered by the same notification under section 4, sub-section (1), irrespective of whether one report or different reports has or have been made (wherever required) under section 5A, sub-section (2)]:
[Provided that no declaration in respect of any particular land covered by a notification under section 4, sub-section (1).
(i) published after the commencement of the Land Acquisition (Amendment and Validation) Ordinance, 1967 (1 of 1967) but before the commencement of the Land Acquisition (Amendment) Act, 1984 shall be made after the expiry of three years from the date of the publication of the notification; or
(ii) published after the commencement of the Land Acquisition (Amendment) Act, 1984, shall be made after the expiry of one year from the date of the publication of the notification:] [Provided further that] no suh declaration nshall be made unless the compensation to be awarded for such property is to be paid by a Company, or wholly or partly out of public revenues or some fund controlled or managed by a local authority.
[Explanation 1. In computing any of the periods referred to in the first proviso, the period during which any action or proceeding to be taken in pursuance of the notification issued under section 4, sub-section (1), is stayed by an order of a Court shall be excluded.] Explanation 2- Where the compensation to be awarded for such property is to be paid out of the funds of a corporation owned or controlled by the State, such compensation shall be deemed to be compensation paid out of public revenues.
(2) [Every declaration] shall be published in the Official Gazette, [and in two daily newspapers circulating in the locality in which the situate of which at least one shall be in the regional language, and the Collector shall cause public notice of the substance of such declaration to be given at convenient places in the said locality (the last of the date of such publication and the giving of such public notice, being hereinafter referred to as the date of publication of the declaration), and such declaration shall state] the district or other territorial division in which the land is situate, the purpose for which it is needed, its approximate area, and where a plan shall have been made of the land, the place where such plan may be inspected.
(3) The said declaration shall be conclusive evidence that the land is needed for a public purpose or for a Company, as the case may be; and, after making such declaration, the [appropriate Government] may acquire the land in manner hereinafter appearing.
9 Notice to persons interested:
(1) The Collector shall then cause public notice to be given at convenient places o or near the land to be taken, stating that the Government intends to take possession of the land, and that claims to compensation for all interests in such land may be made to him.
(2) Such notice shall state the particulars of the land so needed, and shall require all persons interested in the land to appear personally or by agent before the Collector at a time and place therein mentioned (such time not being earlier than fifteen days after the date of publication of the notice), and to state the nature of their respective interests in the land and the amount and particulars of their claims to compensation for such interests, and their objections ( if any) to the measurements made under section 8. The Collector may in any case require such statement to be made in writing and signed by the party or his agent.
(3) The Collector shall also serve notice to the same effect on the occupier (if any) of such land and on all such persons known or believed to be interested therein, or to be entitled to act for persons so interested, as reside or have agents authorised to receive service on their behalf, within the revenue district in which the land is situate.
(4) In case any person so interested resides elsewhere, and has no such agent the notice shall be sent to him by post in a letter addressed to him at his last known residence, address or place of business and registered under sections 28 and 29 of the Indian Post Office Act, 1898 (6 of 1898)].
11. Enquiry and award by Collector [(1)] On the day so fixed, or any other day to which the enquiry has been adjourned, the Collector shall proceed to enquire into the objections (if any) which any person interested has stated pursuant to a notice given under Section 9 to the measurements made under Section 8, and into the value of the land at the date of the publication of the notification under Section 4, sub-section (1)], and into the respective interests of the persons claiming the compensation, and shall make an award under his hand of-
(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:
[Provided that no award shall be made by the Collector under this sub-section without the previous approval of the appropriate Government or of such officer as the appropriate Government may authorise in this behalf.
Provided further that it shall be competent for the appropriate Government to direct that the Collector may make such award without such approval in such class of cases as the appropriate Government may specify in this behalf.] [(2)] Notwithstanding anything contained in sub-section (1), if at any stage of the proceedings, the Collector is satisfied that all the persons interested in the land who appeared before him have agreed in writing on the matters to be included in the award of the Collector in the form prescribed by rules made by the appropriate Government, he may, without making further enquiry, make an award according to the terms of such agreement.
(3) the determination of compensation for any land under sub-section (2) shall not, in any way affect the determination of compensation in respect of other lands in the same locality or elsewhere in accordance with the other provisions of this Act.
(4) Notwithstanding anything contained in the Registration Act, 1908 (16 of 1908), no agreement made under sub-section (2) shall be liable to registration under that Act.]
17. Special powers in cases of urgency-
(1) In cases of urgency, whenever the [appropriate Government], so directs, the collector, though no such award has been made, may, on the expiration of fifteen days from the publication of the notice mentioned in section 9, sub-section (1), [take possession of any land needed for a public purpose]. Such land shall thereupon [vest absolutely in the [Government], free from all encumbrances.
(2) Whenever, owing to any sudden change in the channel or any navigable river or other unforeseen emergency, it becomes necessary for any Railway Administration to anquire the immediate possession of any land for the maintenance of their traffic or for the purpose of making thereon a river-side or ghat station, or of providing convenient connection with or access to any such station, [or the appropriate Government considers it necessary to acquire the immediate possession of any land for the purpose of maintaining any structure or system pertaining to irrigation, water supply, drainage, road communication or electricity,] the Collector may, immediately after the publication of the notice mentioned in sub-section (1) and with the previous sanction of the [appropriate Government], enter upon and take possession of such land, which shall thereupon [vest absolutely in the [Government] free from all encumbrances:
Provided that the Collector shall not take possession of any building or part of a building under this sub-section without giving to the occupier thereof at least forty eight hours notice of his intention so to do, or such longer notice as may be reasonably sufficient to enable such occupier to remove his movable property from such building without unnecessary inconvenience.
(3) In every case under either of the preceding sub-sections the Collector shall at the time of taking possession offer to the persons interested, compensation for the standing crops and trees (if any) on such land and for any other damage sustained by them caused by such sudden dispossession and not excepted in section 24; and, in case such offer is not accepted, the value of such crops and trees and the amount of such other damage shall be allowed for in awarding compensation for the land under the provisions herein contained.
[(3A) Before taking possession of any land under sub-section (1) or sub-section (2), the collector shall, without prejudice to the provisions of sub-section (3),
(a) tender payment of eighty per centum of the compensation for such land as estimated by him to the persons interested entitled thereto, and
(b) pay it to them, unless prevented by some one or more of the contingencies mentioned in section 31, sub-section (2), and where the Collector is so prevented, the provisions of section 31, sub-section (2), (except the second proviso thereto), shall apply as they apply to the payment of compensation under that section.
(3B). the amount paid or deposited under sub-section (3A), shall be taken into account for determining the amount of compensation required to be tendered under section 31, and where the amount so paid or deposited exceeds the compensation awarded by the Collector under section 11, the excess may, unless refunded within three months from the date of the Collector's award, be recovered as an arrear of land revenue.] [(4)] In the case of any land to which, in the opinion of the [appropriate Government], the provisions of sub-section (1) or sub-section (2) are applicable, the [appropriate Government] may direct that the provisions of section 5A shall not apply, and, if it does so direct, a declaration may be made under section 6 in respect of the land at any time [after the date of the publication of the notification] under section 4, sub-section (1)].
12. Thus under the Land Acquisition Act vesting of acquired land takes place on possession being taken under section 16 or section 17 of the Act, 1894.
13. So far as the National Highways Act, 1956 is concerned, Section 3A confers the power on the Central Government to acquire land etc. on being satisfied that for a public purpose any land is required for the building, maintenance, management or operation of a national highway or part thereof, by notification in the official Gazette, declaring its intention to acquire such land. Section 3-C provides for opportunity of hearing of objections to the person interested in the land and the order to be passed by the competent authority on those objections. Section 3-D provides for declaration of acquisition. Under Sub-Section (1) where no objection under Section 3-C(1) has been made to the competent authority within the specified period or where the competent authority has disallowed the objection under section 3-C (2), the competent authority shall as soon as may be submit a report to the Central Government and on receipt of such report, the Central Government shall declare by notification in the Official Gazette, that the land should be acquired for purpose or purposes mentioned in sub-section (1) of Section 3-A. Sub-section (2) of Section 3-D provides that on the publication of the declaration under sub-section (1), the land shall vest absolutely in the Central Government free from all encumbrances.
14. It it is relevant to reproduce Section 3-D of National Highways Act, 1956, as under:-
"3-D. Declaration of acquisition-
(1) Where no objection under sub-section (1) of section 3-C has been made to the compentent authority within the period specified therein or where the competent authority has disallowed the objection under sub-section (2) of that section, the competent authority shall, as soon as may be, submit a report accordingly to the Central Government and on receipt of such report, the Central Government shall declare, by notification in the Official Gazette, that the land should be acquired for the purpose or purposes mentioned in sub-section (1) of section 3A.
(2) On the publication of the declaration under sub-section (1), the land shall vest absolutely in the Central Government free from all encumbrances.
(3) Wherein respect of any land, a notification has been published within a period of one year from the date of publication of that notification, the said notification shall cease to have any effect.
Provided that in computing the said period of one year, the period or periods during which any action or proceedings to be taken in pursuance of the notification issued under sub-section (1) of section 3A is stayed by an order of a court, shall be excluded.
(4) A declaration made by the Central Government under sub-section (1) shall not be called in question in any court or by any other authority.
It it also relevant to reproduce Section 3E of the National Highways Act, 1956 as follows:
3-E. Power to take possession-
(1) Where any land has vested in the Central Government under sub-section (2) of section 3-D, and the amount determined by the competent authority under section 3-G with respect to such land has been deposited under sub-section (1) of section 3-H, with the competent authority by the Central by the Central Government, the competent authority may by notice in writing direct the owner as well as any other person who may be in possession of such land to surrender or deliver possession thereof to the competent authority or any person duly authorised by it in this behalf within sixty days of the service of notice.
(2) If any person refuses or fails to comply with any direction made under sub-section (1), the competent authority shall apply-
(a) in the case of any land situated in any area falling within the metropolitian area, to the Commissioner of Police;
(b) in case of any land situated in any area other than the area referred to in clause (a), to the Collector of a District, and such Commissioner or Collector, as the case may be, enforce the surrender of the land, to the competent authority or to the person duly authorised by it."
15. Thus, under the National Highways Act, on the publication of the declaration under sub-section (1) of Section 3-D the land vests absolutely in the Central Government, free from all encumbrances. It is not dependent upon taking of possession.
16. In the case of Surendra Nath Singh Yadav (supra) the notification under Section 3A of The National Highways Act, 1956 was published on 1.12.2014 and the notification under Section 3-D (1) of the Act, 1956 was published on 24.9.2015. The petitioner therein had purchased the land from its earstwhile owner, vide registered sale deed dated 22.7.2016, after the notification under Section 3A and 3-D (1) of the Act, 1956. The Division Bench of this Court, after considering the judgments of the Hon'ble Apex Court in V. Chandrashekharan Vs. Administrative Officer reported in (2012) 12 SCC 133; and Government (NCT) of Delhi Vs. Manav Dharm Trust reported in 2017 (6) SCC 751, held that the subsequent purchaser, is a person interested only to the extent of claiming compensation of the land, subject matter of acquisition, and, as such, right of compensation being claimed by the petitioner therein was worthy of consideration. This Court directed the Land Acquisition Officer/Additional District Magistrate, (Finance and Revenue), Gandhipur to consider the representation of the petitioner therein (the subsequent purchaser) for making payment of compensation to him.
It is relevant to reproduce paragraphs 4 to 8 of the case of Surendra Nath Singh Yadav (supra), as under:
"(4) It is well settled proposition of law by judicial pronouncement of the Apex Court that purchaser of the land subsequent to initiation of the acquisition proceedings has no locus standi to challenge the acquisition proceedings but certainly he is a person interested in the compensation.
(5) Reference may be made to the decision of the apex Court in the case of Vs. Chandrasekaran v. Administrative Officer, (2012) 12 SCC 133 wherein it has been held as under:
(6) The same view has been reiterated in a recent decision of the apex Court in the case of Government (NCT of Delhi) v. Manav Dharm Trust and another, (2017) 6 SCC 751.
(7) In view of the settled law on the subject, subsequent purchaser is a person interested only to the extent of making a claim of compensation of the land, subject matter of acquisition.
(8) In view of above, right of compensation being claimed by the petitioner is worthy of being considered. However, since the issue involves adjudication into a question of fact, we feel appropriate that the fact finding authority may consider the claim of the petitioner at the initial stage."
17. In the case of Asha Devi (supra) the Division Bench of this Court held that the sale deed executed in favour of a person, subsequent to the publication of the declaration under Section 3-D (I) of the Act, 1956, is void ab initio and does not confer any right upon such person to claim compensation. It is relevant to reproduce relevant portion of the judgment of Asha Devi (supra) as under:-
"Section 3-D(2) of the Act provides that on publication of the declaration under Section 3-D(1), the land shall vests absolutely in the Central Government free from all encumbrances. In the present case, the declaration under Section 3(D) was published on 27 November 2015. The person from whom the petitioner purchased the land, therefore, did not have any title on 11 February, 2016 to sell the land to the petitioner. The sale deed executed in favour of the petitioner is, therefore, void ab initio and does not confer any right upon the petitioner to claim compensation. At best the petitioner can, if so advised, file a Suit against the vendor for recovery of the amount and for consequential reliefs"
18. In Asha Devi Case (supra) the judgment of the co-ordinate bench in Surendra Nath Singh Yadav (supra) does not find mention and appears not to have been brought to the notice of this Court.
19. In the case of Vipin Agrawal (supra) it has been held that on publication of the declaration in the official gazette under Section 3-D(1) of the National Highways Act, 1956, the land vests absolutely in the Central Government free from all encumbrances and thereafter the erstwhile owner is left with no title to such land and any sale deed executed thereafter would be void ab initio and would not confer any right on the subsequent purchaser to receive compensation.
20. In Vipin Agrawal case (supra) this Court considered the case of Surendra Nath Singh Yadav (supra) and held that the case of Government of ( NCT of Delhi) Vs. Manav Dharm Trust 2017 (6) SCC 751, and relied upon in Surendra Nath Singh Yadav (supra), was under the provisions of the Land Acqusition Act, 1894, and as such it was not applicable to the acquisitions made under the National Highways Act, 1956, in as much as under the Land Acquisition Act, the property vests in the Government free from all encumbrances either under section 16 or under Section 17 on possession being taken and not on the publication of declaration under Section 6; whereas under the National Highways Act, 1956, the land vests in the Government free from all encumbrances on publication of the declaration under Section 3D (1). It is relevant to reproduce portion of Vipin Agrawal case (supra) as follows:
"It is, therefore, clear that on receipt of the report, the Central Government declares by notification in the official gazette that the land should be acquired for the purpose mentioned in sub-section (1) of Section 3A. Sub-section (2) of Section 3 provides that on the publication of the declaration under sub-section (1), the land shall vest absolutely in the Central Government free from all encumbrances. Thus, on publication of the declaration in the official gazette on 7 August 2012, the land stood vested in the Central Government free from all encumbrances and the erst while owner did not have any right to execute the sale deed in favour of the petitioner. The sale deed was executed by the petitioner is void ab initio and does not confer any right upon the petitioner to receive compensation.
Learned counsel for the petitioner has placed reliance upon a Division Bench of this Court in Surendra Nath Singh Yadav v. Union of India and Others reported in 2018 (2) ADJ 760. This decision relies upon the decision of the Supreme Court in the case of Government (NCT) of Delhi) v. Manav Dharam Trust and Another reported in (2017) 6 SCC 751 which is in connection with the acquisition under the provisions of the National Highways Act, 1956. Unlike the provisions of sub-Section 3D(2) of the Act under the Land Acquisition Act, the property vests in the State Government free from all encumbrances either under Section 16 or under Section 17, on possession being taken and not on the publication of the declaration under Section 6 of the Act.
Thus, the decision in the case of Surender Nath, does not help the petitioners. The petitioners can initiate appropriate proceedings against the erst while owner."
21. In the case of Smt. Gyanti Singh (supra) it was held that in the light of the law laid down in the case of Vipin Agrawal (supra) the sale deed executed after declaration, as per Section 3D (2) of National Highways Act, 1956, was void ab initio and did not confer any right on the vendee/ transferee to claim compensation. Relevant portion of Gyanti Singh Case (supra) is as under:
"Suffice to mention, in the instant matter the declaration as per Section 3-D of the National Highways Act, 1956 was made on 27 November, 2015 and the sale deed was executed on 7 April, 2017. In this factual background and in the light of the law laid down in the case of Vipin Agarwal, the sale deed is void ab initio and that does not create any right of the petitioner to claim compensation."
22. Thus, in Surendra Nath Singh Yadav (supra) the subsequent purchaser has been held entitled to receive compensation of the land acquired under the National Highways Act, 1956 although the sale took place after the notification under Section 3-D (1); whereas in Asha Devi (Supra), Vipin Agarwal (supra) and Gyanti Singh (supra), the coordinate Benches have held that the subsequent purchaser has no right to receive compensation. Surendra Nath Singh case (supra) has been distinguished on the ground that the Judgment of the Supreme Court in Manav Dharm Trust Case (supra) was under the Land Acquisition Act, 1894, and not under the National Highways Act, 1956.
23. The basic distinction as pointed out in the case of Vipin Agarwal (supra) is that under the Land Acquisition Act, 1894, vesting takes place after taking of possession in pursuance of the notification under Sections 4 and 6, either under Section 16 or Section 17, but under the National Highways Act, 1956, vesting takes place on declaration under Section 3D(1) and as such any sale deed executed thereafter i.e. after vesting of the land in the Government, by the erstwhile owner, is void ab initio.
24. The right of the subsequent purchaser to receive compensation on the strength of his vendor's title has been judicially recognised.
25. In U.P. Jal Nigam Vs. Kalara Properties (P) Ltd. Reported in 1996 (3) SCC 124, M/s Kalara Properties had purchased the land after the notification under Section 4 (1) of the Land Acquisition Act was published. It was held that the sale was void against the State and M/s Kalara Properties acquired no right, title or interest in the land. It could not challenge the validity of the notification or the irregularity in taking possession of land before publication of the declaration under Section 6. Any encumbrance created by the owner after Section 4(1) notification is published does not bind the Government and such a purchaser does not acquire any title on the property. The purchaser is a person interested in the compensation, since he steps into the shoes of earstwhile owner, and is entitled to claim compensation. Relevant part of Paragraph 3 and 4 of the U.P. Jal Nigam (supra) is being reproduced as under:
"3.........It is settled law that after the notification Under Section 4(1) is published in the Gazette any encumbrance created by the owner does not bind the Government and the purchaser does not acquire any title to the property.
In this case notification Under Section 4(1) was published on March 24, 1973, possession of the land admittedly was taken on July 5, 1973 and pumping station house was constructed. No doubt, declaration Under Section 6 was published later on July 8, 1973. Admittedly power Under Section 17(4) was exercised dispensing with the enquiry Under Section 5A and on service of the notice Under Section 9 possession was taken, since urgency was acute, viz., pumping station house was to be constructed to drain out flood water. Consequently, the land stood vested in the State Under Section 17(2) free from all encumbrances. It is further settled law that once possession is taken, by operation of Section 17(2), the land vests in the State free from all encumbrances unless a notification Under Section 48(1) is published in the Gazette withdrawing from the acquisition. Section 11A, as amended by Act 68 of 1984, therefore, does not apply and the acquisition does not lapse. The notification Under Section 4(1) and the declaration Under Section 6, therefore, remain valid. There is no other provision under the Act to have the acquired land divested, unless, as stated earlier, notification Under Section 48(1) was published and the possession are surrendered pursuant thereto.
That apart, since M/s. Kalra Properties, respondent had purchased the land after the notification Under Section 4(1) was published, its sale is void against the State and it acquired no right, title or interest in the land. Consequently, it is settled law that it cannot challenge the validity of the notification or the regularity in taking possession of the land before publication of the declaration Under Section 6 was published."
26. In Sneh Prabha (Smt.) Vs. State of U.P. and another (1996) 7 SCC 426 the Hon'ble Supreme Court reiterated that any alienation of land after publication of the notification under section 4 (1) of the 1894 Act did not bind the Government or the beneficiary under the acquisition. It was also held that if any subsequent purchaser acquires land, his/her only right would be subject to the provisions of the Act and/or to receive compensation for the land. Paragraph 5 of the judgment in the case Sneh Prabha (supra) is being reproduced as under:
"5. Though at first blush, we were inclined to agree with the appellant but on deeper probe, we find that the appellant is not entitled to the benefit of the Land Policy. It is settled law that any person who purchases land after publication of the notification under Section 4(1), does so at his/her own peril. The object of publication of the notification under Section 4(1) is notice to everyone that the land is needed or is likely to be needed for public purpose and the acquisition proceedings point out an impediment to anyone to encumber the land acquired thereunder. It authorises the designated officer to enter upon the land to do preliminaries etc. Therefore, any alienation of land after the publication of the notification under Section 4(1) does not bind the Government or the beneficiary under the acquisition. On taking possession of the land, all rights, titles and interests in land stand vested in the State, under Section 16 of the Act, free from all encumbrances and thereby absolute title in the land is acquired thereunder. If any subsequent purchaser acquires land, his/her only right would be subject to the provisions of the Act and/or to receive compensation for the land. In a recent judgment, this Court in Union of India V. Shivkumar Bhargava considered the controversy and held that a person who purchases land subsequent to the notification is not entitled to alternative site. It is seen that the Land Policy expressly conferred that right only on that person whose land was acquired. In other words, the person must be the owner of the land on the date on which notification under Section 4(1) was published. By necessary implication, the subsequent purchase was elbowed out from the policy and became disentitled to the benefit of the Land Policy."
27. In V. Chandrasekaran and another Vs. Administrative Officer and others (2012) 12 SCC 133 it has been reiterated that at the most, the subsequent purchaser can claim compensation on the basis of his vendor's title. Paragraph 18 of the judgment is being reproduced as under:
"In view of the above, 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 dos not confer upon him, any title and at the most he can claim compensation on the basis of his vendor's title.
28. To the same effect are the decisions of Hon'ble Supreme Court in Rajasthan Housing Board Vs. New Pink City Nirman Sahkari Samiti (2015) 7 SCC 601 and M. Venktesh and others Vs. Commissioner, Bangalore Development Authority (2015) 17 SCC 1, wherein it has been held that the legal position about the validity of any sale, post issuance of a preliminary notification is fairly well settled by long line of decisions. The sale in such cases is void and non east in the eye of the law giving to the vendee the limited right to claim compensation and no more.
29. In Government (NCT of Delhi) Vs. Manav Dharm Trust and another (2017) 6 SCC 751, the Hon'ble Supreme Court held that the subsequent purchaser, the assignee, the successor in interest, the power of attorney holder etc. are all persons who are interested in compensation/landowners/ affected persons in terms of the 2013 Act and such persons are entitled to file a case for a declaration that the land acquisition proceedings have lapsed by virtue of operation of Section 24(2) of the Act, 2013. It is a declaration qua the land wherein indisputably they have an interest and they are affected by such acquisition. For such a declaration, it cannot be said that the respondent-writ petitioners do not have any locus standi.
30. In Shiv Kumar and others Vs. Union of India (UOI) and others reported in (2019) 10 SCC 229 the Hon'ble Supreme Court held that Manav Dharm Trust case does not lay down the law correctly. It was held that when a purchase is void, then no declaration can be sought on the ground that the land acquisition under the Act of 2013 has lapsed due to illegality/irregularity of taking possession under the Act 1894.
31. In Manav Dharm Trust (supra) as well as in Shiv Kumar (supra) the Hon'ble Supreme Court referred to its earlier judgments which recognized that the subsequent purchaser has right to receive compensation on the basis of his vendor's title, although the purchase made after section 4 notification was held to be void against the State.
32. So far as acquisition of the land for national highways is concerned, it was earlier made under the Land Acquisition Act, 1894. The National Highways Act, 1956 as originally enacted did not provide for acquisition of land. The National Highways Act, 1956 was amended by the National Highways Laws (amending) Act, 1997 and Sections 3A to 3J were added. After such amendment, the acquisition of land for the national highways was made and is being made under the National Highways Act, itself.
33. The object of amendment of 1997, was, interalia, to reduce delay and make speedy implementation of highway projects. In order to expedite the process of land acquisition, it was proposed, once the Central Government declares that the land is required for public purposes for development of a highway, that land will vest in the Government and only the amount by way of compensation is to be paid and any dispute relating to the compensation will be subject to adjudication through process of arbitration.
34. In the case of Union of India Vs. Tarsem Singh reported in AIR 2019 SC 4689, vires of Section 3J of the National Highways Act, 1956, was under challenge, as being violative of Article 14 of the Constitution of India, to the extent of non grant of solatium and interest to lands acquired under the National Highways Act; which was available if the lands were acquired under the Land Acquisition Act. The Hon'ble Supreme Court considered the object of the Amendment Act, 1997, in the National Highways Act, 1956 by which Section 3A to 3J were introduced. It is relevant to reproduce paragraphs 6,7,9 and 18 of the judgment in Tarsem Singh (supra) as under:-
6. Having heard the learned Counsel on both sides, it is necessary to first mention that the National Highways Act, 1956, as originally enacted, did not provide for acquisition of land. Thus, till the National Highways Laws (Amendment) Act, 1997, all acquisitions for the purpose of National Highways were made under the Land Acquisition Act, and the owners were given, in addition to market value, solatium as well as interest under the provisions of that Act.
7. Coming to the Amendment Act of 1997, it is important to set out the Objects and Reasons that led to the aforesaid amendment. They are:
1. In order to create an environment to promote private investment in national highways, to speed up construction of highways and to remove bottlenecks in their proper management, it was considered necessary to amend the National Highways Act, 1956 and the National Highways Authority of India Act, 1988.
2. One of the impediments in the speedy implementation of highways projects has been inordinate delay in the acquisition of land. In order to expedite the process of land acquisition, it is proposed that once the Central Government declares that the land is required for public purposes for development of a highway, that land will vest in the Government and only the amount by way of compensation is to be paid and any dispute relating to compensation will be subject to adjudication through the process of arbitration.
3. It was also felt necessary to ensure continuity of the status of bypasses built through private investment. To achieve this, it is proposed to amend the National Highways Act, 1956 so as to include the highway stretches situated within any municipal area as a part of National Highway. Further, as the National Highways Act, 1956 permits participation of the private sector in the development of the National Highways, it became imperative to amend the National Highways Authority of India Act, 1988 so as to provide that the National Highway Authority of India may seek the participation of the private sector in respect of the highways vested in the Authority.
4. With a view to provide adequate capital and loans to the National Highways Authority of India by the Central Government, it is proposed to make amendment in the National Highways Authority of India Act, 1988.
5. With a view to achieve the above objectives and also as both Houses of Parliament were not in session and the President was satisfied that circumstances existed which rendered it necessary for him to take immediate action, the National Highways Laws (Amendment) Ordinance, 1997 was promulgated by the President on the 24th day of January, 1997.
6. The Bill seeks to replace the aforesaid Ordinance.
9. Keeping in view the object of reducing delay and speedy implementation of highway projects, the amended National Highways Act does away with any "award" by way of an offer to the landowner. Post the notification Under Section 3A, objections are to be heard by the competent authority, whose order is then made final. The moment the authority disallows the objections, a report is submitted to the Central Government, and on receipt of such report, the Central Government, by a declaration, states that the land should be acquired for the purpose mentioned in Section 3A. The important innovation made by the Amendment Act is that vesting is not postponed to after an award is made by the Competent Authority. Vesting takes place as soon as the Section 3D declaration is made. One other important difference between the Amendment Act and the Land Acquisition Act is that determination of compensation is to be made by the competent authority under the Amendment Act which, if not accepted by either party, is then to be determined by an Arbitrator to be appointed by the Central Government. Such arbitrator's Award is then subject to challenge under the Arbitration and Conciliation Act, 1996. Thus, delays in references made to District Judges and appeals therefrom to the High Court and Supreme Court have been obviated. Section 3G(7) does not provide for grant of solatium, and Section 3H(5) awards interest at the rate of 9% on the excess amount determined by the arbitrator over what is determined by the competent authority without the period of one year contained in the proviso to Section 28 of the Land Acquisition Act, after which interest is only awardable at the rate of 15% per annum, if such payment is made beyond one year.
18. When we examine the Objects and Reasons which led to the 1997 amendment of the National Highways Act, we do not find mentioned therein any object relating to distribution of the material resources of the community. The object of the Amendment Act has no relationship whatsoever to the Directive Principle contained in Article 39(b), inasmuch as its limited object is to expedite the process of land acquisition by avoiding inordinate delays therein. The object of the Amendment Act was not to acquire land for the purpose of national highways as, pre-amendment, the Land Acquisition Act provided for this. The object of the Amendment Act was fulfilled by providing a scheme different from that contained in the Land Acquisition Act, making it clear that the stage of offer of an amount by way of compensation is removed altogether; vesting takes place as soon as the Section 3D notification is issued; and most importantly, the tardy Court process is replaced by arbitration. Obviously, these objects have no direct and rational nexus with the Directive Principle contained in Article 39(b). Article 31-C is, therefore, out of harm's way. Even otherwise, on the assumption that Article 31-C is attracted to the facts of this case, yet, as was held by Bhagwati, J. in Minerva Mills Ltd. v. Union of India.
...it is not every provision of a statute, which has been enacted with the dominant object of giving effect to a directive principle, that it entitled to protection, but only those provisions of the statute which are basically and essentially necessary for giving effect to the directive principle are protected under the amended Article 31-C (at page 338-339) This passage was specifically referred to in Tinsukhia Electric Supply Co. Ltd. v. State of Assam MANU/SC/0027/1990 : (1989) 3 SCC 709 at 735. Also, in Maharashtra State Electricity Board v. Thana Electric Supply Co.
43. The idea of nationalisation of a material resource of the community cannot be divorced from the idea of distribution of that resource in the community in a manner which advances common good. The cognate and sequential question would be whether the provisions of the Amending Act, 1976, had a reasonable and direct nexus with the objects of Article 39(b). It is true, the protection of Article 31-C is accorded only to those provisions which are basically and essentially necessary for giving effect to the objects of Article 39(b). The High Court from the trend of its reasoning in the judgment, appears to take the view that while the provision for the takeover in the principal Act might amount to a power to acquire, however, the objects of the Amending Act of 1976, which merely sought to beat down the price could not be said to be part of that power and was, therefore, incapable of establishing any nexus with Article 39(b). There is, we say so with respect, a fallacy in this reasoning.
The test of Article 31-C's protection being accorded only to those provisions which are basically and essentially necessary for giving effect to the objects of Article 39(b) is lifted from Akadasi Padhan v. State of Orissa MANU/SC/0089/1962 : 1963 Supp. (2) SCR 691, where this Court held, with reference to Article 19(6), that qua laws passed creating a State monopoly, it is only those essential and basic provisions which are protected by the latter part of Article 19(6). This Court stated the test thus:
17. In dealing with the question about the precise denotation of the Clause "a law relating to", it is necessary to bear in mind that this Clause occurs in Article 19(6) which is, in a sense, an exception to the main provision of Article 19(1)(g). Laws protected by Article 19(6) are regarded as valid even though they impinge upon the fundamental right guaranteed Under Article 19(1)(g). That is the effect of the scheme contained in Article 19(1) read with Clauses (2) to (6) of the said Article. That being so, it would be unreasonable to place upon the relevant Clause an unduly wide and liberal construction. "A law relating to" a State monopoly cannot, in the context, include all the provisions contained in the said law whether they have direct relation with the creation of the monopoly or not. In our opinion, the said expression should be construed to mean the law relating to the monopoly in its absolutely essential features. If a law is passed creating a State monopoly, the Court should enquire what are the provisions of the said law which are basically and essentially necessary for creating the State monopoly. It is only those essential and basic provisions which are protected by the latter part of Article 19(6). If there are other provisions made by the Act which are subsidiary, incidental or helpful to the operation of the monopoly, they do not fall under the said part and their validity must be judged under the first part of Article 19(6). In other words, the effect of the amendment made in Article 19(6) is to protect the law relating to the creation of monopoly and that means that it is only the provisions of the law which are integrally and essentially connected with the creation of the monopoly that are protected. The rest of the provisions which may be incidental do not fall under the latter part of Article 19(6) and would inevitably have to satisfy the test of the first part of Article 19(6). (at page 707) Even if the Amendment Act, 1997 be regarded as an Act to carry out the purposes of Article 39(b), the object of the Amendment Act is not served by removing solatium and interest from compensation to be awarded. It is obvious, therefore, that the grant of compensation without solatium and interest is not basically and essentially necessary to carry out the object of the Amendment Act, 1997, even if it is to be considered as an acquisition Act pure and simple, for the object of the said Amendment Act as we have seen is to obviate delays in the acquisition process of acquiring land for National Highways. On application of this test as well, it is clear that the grant of compensation without solatium and interest, not being basically and essentially necessary to carry out the object of the Amendment Act, would not receive the protective umbrella of Article 31-C and, therefore, any infraction of Article 14 can be inquired into by the Court."
35. The object of the Amendment Act 1997, as seen above, was not to deprive the subsequent purchaser, after the notification of declaration under Section 3D (1), of his right to receive compensation of the acquired land on the strength of his vendor's title. The object of the 1997 Amendment was to speed up the process of acquiring lands for National Highways, to be achieved in the manner of Sections 3A to 3H.
36. Under the Land Acquisition Act, 1894, sale executed after the publication of notification under section 4(1) was void and not binding on the State but inspite thereof the right of the subsequent purchaser to receive compensation was a judicially recognized right. Such right of a subsequent purchaser, appears to us to be still substituting under the National Highways Act, 1956, even if the sale is made after publication of declaration under Section 3D(1). The sale shall be void against the Government as it was earlier. But the same shall not deprive subsequent purchaser from receiving compensation of the acquired land on the strength of vendor's title.
37. The Government has to make payment of compensation. Its payment to the tenure holder whose land is acquired or to the subsequent purchaser has nothing to do with achieving the object of the amendment Act 1997 i.e. speedy acquisition of land for National Highways nor it comes in the way of achieving that object.
38. We are thus faced with a situation where there are conflicting judgments of co-ordinate Benches on the point in issue. On the one hand there is judgment in Surendra Nath Singh Yadav (supra) and on the other the judgments in the cases of Asha Devi, Vipin Agrawal and Smt. Gyanti Singh (supra). Both the judgments in Surendra Nath Yadav as well as in Vipin Agrawal considered the judgment of the Hon'ble Supreme Court in the case of Manav Dharm Trust (supra); the former case holding that the subsequent purchaser has a right to receive compensation but the later case taking a contrary view distinguishing Manav Dharm Trust Case as being under the Land Acquisition Act and not under the National Highways Act.
39. In the case of Usha Kumar Vs. State of Bihar (1998) 2SCC 44, the Hon'ble Supreme court has held that judicial discipline requires that if two Division Benches of the same High Court take different views, the matter should be referred to a larger bench. The Division Bench cannot ignore or refuse to follow the decision of an earlier Division Bench of the same court and proceed to give its decision contrary to the decision given by the earlier Division Bench. It is relevant to reproduce relevant para 3 of Usha Kumar (supra) as under:
In the impugned judgment of a Division Bench of the Patna High Court (Hon'ble Aftab Alam and A.N. Trivedi, JJ.) dated 1-5-1995, the Division Bench has taken a view which is different from the view taken by the two earlier Division Benches of the same High Court. The judgment itself sets out that normally the matter should have been referred to a larger Bench; but this may further delay the matter and hence the Division Bench was proceeding with its judgment. This course which is taken by the Division Bench has created obvious difficulties. Judicial discipline requires that if two Division Benches of the same High Court take different views, the matter should be referred to a larger Bench. One Division Bench cannot ignore or refuse to follow the decision of an earlier Division Bench of the same Court and proceed to give its decision contrary to the decision given by the earlier Division Bench. If it is inclined to take a different view, a request should be made to the Chief Justice to refer the same to a Full Bench. Even the purpose of saving time has not been served in the present case. The decision has merely generated these appeals which are filed in view of the conflicting views taken by two Division Benches. The State has also come in appeal before us. All the parties are agreed that the appropriate course would be to refer the matter to the Full Bench of the Patna High Court. All these appeals are, therefore, remanded to the High Court of Patna. The Chief Justice of that High Court may constitute a Full Bench for deciding all issues which were raised before the Division Bench in the impugned judgment. Although the departure from the earlier decisions of the Division Bench may not be on all issues raised before the Court, since the appeals are being remanded to the High Court, it is desirable that the Full Bench, in considering all these matters, deals with all the issues which were raised and considered by the Division Bench in the impugned judgment.
40. Similarly in the case of Rajasthan Public Commission and others Vs. Hari reported in 2003 (5) SCC 480 the Hon'ble Supreme Court has reiterated that if the Bench hearing matters subsequently entertains any doubt about the correctness of the earlier decision the only course open to it is to refer the matter to a larger Bench. The Hon'ble Supreme Court quoted its earlier judgment in State of Tripura Vs. Tripura Bar Association and others AIR 1999 SC 1494. It is relevant to reproduce paragraph12, 13 and 14 of the said judgment as under:-
"12. Before parting with the case we would like to point out one disturbing feature which has been brought to our notice. On 13-12-2001 a Division Bench dismissed an application containing identical prayers. Even before the ink was dry on the judgment, by the impugned judgment, another Division Bench took a diametrically opposite view. It is not that the earlier decision was not brought to the notice of the subsequent Division Bench hearing the subsequent applications. In fact, a reference has been made by the submissions made by the Commission where this decision was highlighted. Unfortunately, the Division Bench hearing the subsequent applications did not even refer to the conclusions arrived at by the earlier Division Bench. The earlier decision of the Division Bench is binding on a Bench of coordinate strength. If the Bench hearing matters subsequently entertains any doubt about the correctness of the earlier decision, the only course open to it is to refer the matter to a larger Bench.
13. The position was highlighted by this Court in a three-Judge Bench decision in State of Tripura v. Tripura Bar Assn. [(1998) 5 SCC 637 : 1998 SCC (L&S) 1426] in the following words: (SCC p. 639, para 4) "4. We are of the view that the Division Bench of the High Court which has delivered the impugned judgment being a coordinate Bench could not have taken a view different from that taken by the earlier Division Bench of the High Court in the case of Durgadas Purkayastha v. Hon'ble Gauhati High Court[(1988) 1 Gau LR 6] . If the latter Bench wanted to take a view different than that taken by the earlier Bench, the proper course for them would have been to refer the matter to a larger Bench. We have perused the reasons given by the learned Judges for not referring the matter to a larger Bench. We are not satisfied that the said reasons justified their deciding the matter and not referring it to the larger Bench. In the circumstances, we are unable to uphold the impugned judgment of the High Court insofar as it relates to the matter of inter se seniority of the Judicial Officers impleaded as respondents in the writ petition. The impugned judgment of the High Court insofar as it relates to the matter of seniority of the respondent Judicial Officers is set aside. The appeals are disposed of accordingly. No costs."
14. In the instant case, the position is still worse. The latter Bench did not even indicate as to why it was not following the earlier Bench judgment though brought to its notice. Judicial propriety and decorum warranted such a course indicated above to be adopted."
42. We, therefore, consider it appropriate to refer and we hereby refer the following questions for authoritative pronouncement by Hon'ble the Full Bench:
(i) Whether a subsequent purchaser of the land acquired under the National Highways Act, 1956, after publication of declaration under Section 3D (1), is not entitled to receive compensation on the strength of his vendor's title in view of Section 3D(2)?
(ii) Which of the judgments (i) Surendra Nath Singh Yadav (supra) or (ii) Vipin Kumar Agarwal, Asha Devi and Smt. Gyanti Singh, lay down the law correctly?
43. The Registry is directed to place the papers of this case before Hon'ble the Chief Justice for appropriate orders.
44. List this petition after the reference is answered.
Order date: 22.1.2020 Manish Tripathi