Reportable

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 438 OF 2011 [Arising out of SLP [C] No.21512/2005]

Land Acquisition Officer-cum-RDO, Chevella Division Ranga Reddy District … Appellant

Vs.

A.Ramachandra Reddy & Ors. … Respondents

With

CA No. 440 of 2011 (Arising out of SLP [C] No.13268/2006); CA No. 441 of 2011 (Arising out of SLP [C] No.13382/2006); CA No. 442 of 2011 (Arising out of SLP [C] No.13387/2006); CA No. 443 of 2011 (Arising out of SLP [C] No.13388/2006); CA No. 444 of 2011 (Arising out of SLP [C] No.13412/2006);  CA No. 445 of 2011 (Arising out of SLP [C] No.14871/2006).

J U D G M E N T

R.V.RAVEENDRAN, J.

Leave granted in all the SLPs.

2. An extent of 24 acres in Survey No.24 of Peeram Cheruvu Village,  

Rajendranagar Mandal, Ranga Reddy District on the outskirts of Hyderabad  

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was  acquired  for  Andhra  Pradesh  Police  Academy.  For  this  purpose,  a  

preliminary notification under section 4(1) read with section 17 of the Land  

Acquisition Act, 1894 (‘Act’ for short) was issued and published in the A.P.  

Gazette on 3.1.1990. It was also published in two newspapers circulating in  

that locality on 12.2.1990. The final declaration under section 6 of the Act  

was  published  in  the  A.P.  Gazette  dated  10.1.1990  (published  in  two  

newspapers  circulating  in  that  locality  on  12.2.1990).  Possession  of  the  

acquired lands was taken on 18.9.1991 by invoking the urgency clause under  

section 17 of the Act.  

3. The  respondents  filed  W.P.No.14396/1991 in  the  A.P.  High Court  

seeking  a  direction  to  the  appellant  to  pass  an  award.  The  High  Court  

disposed  of  the  said  writ  petition  with  a  direction  to  pass  an  award  

before 11.2.1992 as the final notification had been published in the Gazette  

on 10.1.1992. The award was not be passed within the stipulated two years.  

The  State  government,  being  of  the  view  that  as  a  consequence,  the  

acquisition  had  lapsed,  published  a  fresh  preliminary  notification  dated  

9.9.1993 under section 4(1) of the Act in the A.P. Gazette dated 19.11.1993,  

followed by a fresh final declaration under section 6 of the Act published in  

the Gazette dated 16.2.1994.  

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4. Ultimately,  the  Land  Acquisition  Officer  made  an  award  dated  

31.8.1996. Before doing so he appears to have sought legal opinion as to the  

date with reference to which the compensation should be determined. The  

legal opinion was that as possession was taken on 18.9.1991 by invoking  

section 17, the acquisition proceedings did not lapse under section 11A of  

the  Act  and  the  fresh  acquisition  notifications  dated  19.11.1993  and  

16.2.1994 could be ignored and the award could be passed with reference to  

the market value as on the date of issue of the first preliminary notification  

dated  3.1.1990.  The  Land  Acquisition  Officer,  after  referring  the  sales  

statistics and nature of land, by award dated 31.8.1996 offered compensation  

at the rate of Rs.24,000/- per acre with 30% solatium under section 23(2),  

additional  market  value  at  12%  per  annum  under  section  23(1A)  from  

12.2.1990 to 18.9.1991 and interest  at  the rate  of 9% per annum for the  

period  18.9.1991  to  17.9.1992  and  at  the  rate  of  15%  per  annum  from  

18.9.1992 to 31.8.1996.  

5. Not  being  satisfied  with  the  quantum  of  compensation,  the  

respondents-landowners  sought  reference  to  Civil  Court.  Before  the  

Reference Court, the respondents let in evidence about market value as on  

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19.11.1993,  which  is  the  date  of  publication  of  the  second  preliminary  

notification.  The  Reference  Court  held  that  the  relevant  date  of  

determination of market value was 3.1.1990 (which was the date of the first  

preliminary notification), that there was no evidence about the market value  

as  on  3.1.1990.  He  held  that  none  of  the  sale  deeds  relied  upon by  the  

landowners  was  relevant,  as  they  were  all  with  reference  to  the  second  

preliminary notification published on 19.11.1993.  However having regard  

to the situation and potential of the land, it  concluded that approximately  

double the amount offered by the Land Acquisition Officer would be the  

appropriate market value and therefore awarded compensation at the rate of  

Rs.50,000 per acre.

6. The respondents were not satisfied with the amount awarded by the  

Reference Court. They therefore filed a batch of appeals before the Andhra  

Pradesh High Court. Some of the appeals were decided by judgment dated  

16.2.2005 and some were decided by judgment dated 3.1.1996 following the  

judgment dated 16.2.2005. The High Court was of the view that the relevant  

date  for  determination  of  compensation  was  not  3.1.1990  as  the  said  

preliminary notification was superseded by notification under section 4(1) of  

the Act published on 19.11.1993 and therefore the compensation had to be  

determined with reference to the said date. The High Court relied upon a  

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sale deed dated 12.11.1993 (Ex. A7) relating to sale of a land at a distance of  

about 30 yards from the acquired lands to arrive at the market value of the  

acquired land as on 19.11.1993. The said sale deed (Ex.A7) related to a sale  

of an area of 1 acre 38 guntas (a little less than two acres) in favour of an  

educational institution for a consideration of Rs.490,000/- (which works out  

Rs.250,000/- per acre). The High Court rounded off the market value to Rs.  

250,000/-  per  acre,  deducted  40%  from  the  said  value  to  make  it  a  

comparable transaction for determination of market value and consequently  

awarded  compensation  at  the  rate  of  Rs.150,000/-  per  acre.  The  said  

judgment is under challenge in these appeals by special leave by the Land  

Acquisition Officer.

7. On the contentions urged, two questions arise for consideration :  

(i) Whether relevant date for determination of market value is 3.1.1990  as contended by the appellant (or 19.11.1993)?  

(ii) Whether  the  compensation  determined  at  Rs.150,000/-  per  acre  requires interference?  

8. The appellant submitted that the first preliminary notification under  

section  4(1)  read  with  section  17  of  the  Act  was  gazetted  on  3.1.1990  

followed by a final declaration under section 6 of LA Act on 10.1.1990. As  

the urgency provision in section 17 of the Act was invoked, there was no  

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inquiry under section 5A of the Act and possession was taken on 18.9.1991  

even  before  making  an  award.   The  appellant  contended  that  where  

possession is taken invoking section 17 of the Act, the acquisition would not  

lapse under section 11A of the Act even if the award was not made within  

two  years  from  the  date  of  final  declaration.  In  support  of  the  said  

contention, the appellant relied upon the decision of this Court in Satendra  

Prasad Jain v. State of U.P. [1993 (4) SCC 369], wherein it was held that  

when section 17(1) of the Act is invoked by reason of urgency and the State  

Government takes possession of the land prior to the making of the award  

under section 11 of the Act and thereupon the owner is divested of the title  

of the land which vested in the Government, section 11A would have no  

application. It was also held that ordinarily if the Government fails to make  

an award within two years of the declaration under section 6 of the Act, the  

acquisition would lapse, if the land had not vested in the Government. But  

where the land has already vested in the Government by taking possession,  

there is no provision in the Act by which the lands statutorily vested in the  

Government could revert back to the land owner and therefore section 11A  

was inapplicable.  This  Court further  held that  even if  the 80% estimated  

compensation required to be paid under section 17(3-A) of Act was not paid  

to the owner, that would not mean that the possession was taken illegally or  

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that the land did not vest in the Government.  

9. The appellant contended that as the land vested in the government by  

reason  of  possession  being  taken  by  invoking  section  17  of  the  Act  on  

18.9.1991, section 11A of the Act would be inapplicable and the acquisition  

did not lapse. It was further submitted that as a consequence, the preliminary  

notification dated 3.1.1990 and final declaration dated 10.1.1990 continued  

to operate and consequently, the fresh notification dated 9.9.1993 (gazetted  

on  19.11.1993)  followed  by  final  declaration  dated  16.2.1994  became  

redundant and inapplicable. The appellant contends that the High Court was  

therefore  not  justified  in  proceeding  on  the  basis  that  the  compensation  

should  be  fixed  with  reference  to  the  date  of  publication  of  the  second  

preliminary  notification  that  is  19.11.1993,  instead  of  determining  the  

market value as on 3.1.1990.  

10. On a careful  consideration, we are of the view that the decision in  

Satayender Prasad Jain will not apply to this case. The issue in this case is  

not  whether  the  acquisition lapsed or  not.  The issue is  where  the earlier  

preliminary  and  final  notifications  are  superseded  by  the  subsequent  

preliminary and final notifications and whether the market value should be  

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fixed  with  reference  to  the  first  preliminary  notification  or  the  second  

preliminary  notification.  Section  17  as  amended  in  Andhra  Pradesh,  no  

doubt provided that the land would vest absolutely in the government even  

before making  the award,  on taking possession of  the land needed for a  

public purpose. But as the Land Acquisition Officer failed to estimate the  

compensation and tender 80% thereof to the land-owners, as required under  

section 17(3A) of the Act, the land-owners approached the High Court by  

filing WP No.14396 of 1991 seeking a direction to the appellant to pass the  

award. As possession had been taken as the land had already vested in the  

government, the land owners could not and did not challenge the acquisition  

in  the  said  writ  petition.  Keeping  these  facts  in  view,  the  High  Court  

disposed of the said writ petition with a specific direction to make an award  

before 11.2.1992. Admittedly, the award was not made and the order of the  

High Court was not complied with. It is also of some relevance to note that  

under  sub-section  (5)  of  section  17  of  the  Act,  inserted  by  a  State  

Amendment in Andhra Pradesh, if the Collector does not take possession of  

the land within three months from the date when State Government directs  

under sub-section (4) of section 17 that the provisions of section 5A shall  

not apply, the effect would be that the provisions of section 5A would apply  

and the period of 30 days referred to in section 5A shall be reckoned from  

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the date of expiration of three months. In these peculiar circumstances, the  

government after considering the facts and circumstances,  with a view to  

avoid further challenge, issued a fresh notification dated 9.9.1993 (gazetted  

on  19.11.1993)  followed by final  declaration  dated  16.2.1994.  The  State  

Government did not subsequently cancel/rescind/withdraw the notifications  

dated 9.9.1993 and 16.2.1994. The State Government had clearly abandoned  

the  earlier  notifications  dated  3.1.1990  and  10.1.1990  by  issuing  the  

subsequent notifications dated 9.9.1993 and 16.2.1994. The appellant cannot  

therefore contend that the second preliminary notification is  redundant or  

that  first  preliminary  notification  continues  to  hold  good.  In  the  

circumstances,  the  High  Court  was  justified  in  holding  that  the  

compensation should be determined with reference to the date of publication  

of the second preliminary notification, namely 19.11.1993.  

11. If  we examine the quantum of compensation awarded by the High  

Court  with  reference  to  the  date  of  gazetting  of  the  second  preliminary  

notification, that is 19.11.1993, we find that the compensation award is not  

excessive and does not call  for interference.  It  has been determined with  

reference to a sale transaction dated 12.11.1993, just a few days prior to the  

publication  of  the  second  preliminary  notification  in  the  gazette  dated  

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19.11.1993. The High Court has also made a deduction of 40% in the market  

value disclosed by the said sale transaction.

12. In some of the counter affidavits filed in the special leave petitions by  

the  claimants,  they  have  alleged  that  their  special  leave  petitions  

(challenging  the  judgment  of  the  High  Court  and  seeking  higher  

compensation) were dismissed as barred by time and therefore, they may be  

permitted to make a counter claim for a higher compensation. Such counter-

claims in counter-affidavits in special leave petitions are impermissible and  

not maintainable and cannot be entertained.  

13. In view of the above, these appeals are dismissed.  

………………………….J. (R V Raveendran)

New Delhi; …………………………J. January 12, 2011. (H L Gokhale)                       

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