PRAHLAD SINGH & ORS. v.

UNION OF INDIA & ORS. (Civil Appeal No. 3779 of 2011)

APRIL 29, 2011 [G. S. Singhvi and Asok Kumar Ganguly, JJ.]

[2011] 5 SCR 1002

The following order of the Court was delivered

O R D E R

Delay condoned.

Leave granted.

Whether the acquired land can be treated to have vested in the State  

Government under Section 16 of the Land Acquisition Act, 1894 (for short,  

“the Act”) on the making of an award by the Collector though the actual and  

physical  possession  continues  with  the  landowner  is  the  question  which  

arises for consideration in this appeal filed against the order of the Division  

Bench of the Punjab and Haryana High Court whereby the writ petition filed  

by the appellants questioning the acquisition of their land was dismissed.

In exercise of the power vested in it under Section 4(1) of the Act, the  

Government  of  Haryana  issued  notification  dated  17.4.2002  for  the  

acquisition of the appellants' land along with other parcels of land of village  

Baloure, Tehsil Bahadurgarh, District Jhajjar for development and utilization  

thereof for residential, commercial and institutional parts of different sectors of  

Bahadurgarh.

The predecessors of the appellant and other landowners filed objections  

under Section 5-A(1) and prayed that their land may not be acquired because  

they had developed the same for agricultural activities like dairy, gardening  

etc. by investing huge money. They claimed that the acquisition proceedings

were initiated without application of  mind and there was no justification to  

acquire fertile and irrigated land. They also pointed out that land acquired for  

the same purpose in 1965 was still lying vacant and undeveloped. Another  

objection taken by the predecessors of the appellant and other landowners  

was that the area proposed to be acquired falls in the National Capital Region  

under the National Capital Region Planning Board Act, 1985 (for short, “the  

1985 Act”) and in the Regional Plan prepared by the National Capital Region  

Planning Board (for short, “the Board”), land in question has been shown as  

part of Green Belt/Green Wedge and, as such, the same cannot be acquired  

for residential, commercial and institutional purposes. In support of this plea,  

the landowners relied upon an order passed by this Court in C.A. Nos.4384  

and 4385 of 1994.

Although, it is not clear from the record as to how the Collector dealt with  

the objections and submitted recommendations to the State Government, this  

much  is  evident  that  the  State  Government  issued  declaration  dated  

10.4.2003 under Section 6 of  the Act reiterating its resolve to acquire the  

entire area notified under Section 4(1) on 17.4.2002. Thereafter,  the Land  

Acquisition Collector passed award dated 25.6.2004.

Immediately after pronouncement of the award, the predecessors of the  

appellant  and  other  landowners  filed  69  writ  petitions  questioning  the  

acquisition  proceedings  on various  grounds including non-consideration  of  

their objections, non-application of mind by the Collector and the concerned  

authorities  of  the State Government  and violation of  the provisions of  the  

1985 Act and Regional Plan 2001 prepared by the Board. They pleaded that  

being  a  participating  State,  the  State  of  Haryana  is  bound  to  act  in  

consonance with the provisions of the 1985 Act and it cannot acquire land in  

violation of Regional Plan 2001. They relied upon the judgment of this Court  

in Ghaziabad Development Authority v. Delhi Auto & General Finance (Pvt.)  

Ltd. (1994) 4 SCC 42 and pleaded that the land which has been identified in  

Regional  Plan 2001 as  Green Belt/Green Wedge cannot  be used for  the

purpose of urbanization. They also claimed that possession of the acquired  

land was still with them and they were cultivating the same.

The Division Bench of the High Court did not deal with the grounds on  

which the appellants questioned the acquisition of their land including the one  

that the impugned acquisition was contrary to the provisions of the 1985 Act  

and Regional Plan 2001 and dismissed the writ  petitions by observing that  

once the land has vested in the State Government, the writ petitioners do not  

have the locus to challenge the acquisition proceedings. The Division Bench  

relied upon the judgments of this Court in  Municipal Corporation of Greater   

Bombay v. Industrial Development and Investment Company (P) Ltd. (1996)  

11 SCC 501,  C. Padma v.  Deputy Secretary to the Government of  Tamil   

Nadu (1997) 2 SCC 627, Municipal Council, Ahmednagar v. Shah Hyder Beig  

(2000) 2 SCC 48,  Star Wire (India) Ltd. v. State of Haryana (1996) 11 SCC  

698, Swaika Properties (P) Ltd. v. State of Rajasthan (2008) 4 SCC 695 and  

Sawaran Lata v. State of Harayana (2010) 4 SCC 532 and held as under:

“It  is,  thus,  well  settled  that  no writ  petition  would  be competent  after  

passing of award because possession of land is taken and it is deemed to  

vest in the State Government free from all encumbrances. The petitioners  

would of course be entitled to compensation at the market value prevalent  

at  the  time  of  issuance  of  notification  under  Section  4  of  the  Act  in  

accordance with the award subject to further remedies of reference etc.  

The petitioners would also be entitled to compensation for the user of the  

land from the date of possession to the date of notification issued under  

Section 4. Thus, no ground is made out to accept the contention raised by  

the petitioners and to quash the acquisition proceedings subject matter of  

these petitions.”

Mrs. Rani Chhabra, learned counsel appearing for the appellants argued  

that the impugned order is liable to be set aside because the premise on  

which  the  High  Court  dismissed  the  writ  petition,  namely,  vesting  of  the

acquired  land  in  the  State  Government  is  ex  facie  erroneous.  Learned  

counsel submitted that at no point of time possession of the acquired land  

was taken by the State authorities and, therefore, the same cannot be treated  

to have vested in the State Government. Mrs. Chhabra invited our attention to  

the  assertion  contained  at  page  'Y'  of  the  List  of  Dates  and  documents  

marked Annexures-P5 and P6 to show that physical possession of the land is  

still  with  the  appellants.  Learned  counsel  emphasised  that  the  appellants  

have been in continuous possession of the land and carrying on agricultural  

operations and submitted that the High Court gravely erred by declaring that  

the acquired land will  be deemed to have vested in the State Government  

under Section 16 of  the Act.  Mrs.  Chhabra submitted that  the High Court  

should have examined the important issues raised by the appellants including  

the  violation  of  the  provisions  of  the  1985  Act  and  Regional  Plan  2001  

prepared by the Board in which the acquired land is shown as part of the  

Green Belt/Green Wedge and decided the writ petition on merits keeping in  

view the fact that the same remained pending for 10 years and during that  

period the landowners had been undertaking agricultural operations.

Learned counsel appearing for the State could not draw our attention to  

any material to show that actual and physical possession of the acquired land  

had been taken by the State authorities. He, however, argued that by virtue of  

Section 16 of the Act the acquired land will be deemed to have vested in the  

State Government because the Land Acquisition Collector has passed award  

on 25.6.2004.

We have  given  our  serious  thought  to  the  entire  matter  and carefully  

examined  the  records.  Section  16 lays  down that  once the  Collector  has  

made an award under Section 11, he can take possession of the acquired  

land. Simultaneously, the section declares that upon taking possession by the  

Collector, the acquired land shall vest absolutely in the Government free from  

all encumbrances. In terms of the plain language of this section, vesting of  

the acquired land in the Government takes place as soon as possession is

taken by the Collector after passing an award under Section 11. To put it  

differently, the vesting of land under Section 16 of the Act presupposes actual  

taking  of  possession  and  till  that  is  done,  legal  presumption  of  vesting  

enshrined in Section 16 cannot be raised in favour of the acquiring authority.

Since  the  Act  does  not  prescribes  the  mode  and  manner  of  taking  

possession of the acquired land by the Collector, it will be useful to notice  

some of the judgments in which this issue has been considered. In Balwant  

Narayan Bhagde v. M.D. Bhagwat  (1976) 1 SCC 700, Bhagwati J., (as he  

then was), speaking for himself and Gupta J. disagreed with Untwalia J., who  

delivered separate judgment and observed:

“………We think it is enough to state that when the Government proceeds  

to take possession of the land acquired by it under the Land Acquisition  

Act, 1894, it must take actual possession of the land, since all interests in  

the land are sought to be acquired by it.  There can be no question of   

taking  “symbolical”  possession  in  the  sense  understood  by  judicial   

decisions  under  the  Code  of  Civil  Procedure.  Nor  would  possession  

merely on paper be enough. What the Act contemplates as a necessary  

condition of vesting of the land in the Government is the taking of actual   

possession  of  the  land.  How  such  possession  may  be  taken  would  

depend on the nature of the land. Such possession would have to be  

taken as the nature of the land admits of. There can be no hard and fast  

rule  laying  down  what  act  would  be  sufficient  to  constitute  taking  of  

possession of land. We should not, therefore, be taken as laying down an  

absolute and inviolable rule that merely going on the spot and making a  

declaration by beat of drum or otherwise would be sufficient to constitute  

taking of possession of land in every case. But here, in our opinion, since  

the land was lying fallow and there was no crop on it at the material time,  

the act of the Tehsildar in going on the spot and inspecting the land for   

the purpose of determining what part was waste and arable and should,   

therefore,  be  taken  possession  of  and  determining  its  extent,  was

sufficient to constitute taking of possession. It appears that the appellant   

was not present when this was done by the Tehsildar, but the presence   

of the owner or the occupant of the land is not necessary to effectuate the   

taking of possession. It is also not strictly necessary as a matter of legal  

requirement that notice should be given to the owner or the occupant of  

the land that possession would be taken at a particular time, though it  

may be desirable where possible, to give such notice before possession  

is taken by the authorities, as that would eliminate the possibility of any  

fraudulent or collusive transaction of taking of mere paper possession,  

without the occupant or the owner ever coming to know of it.”

(emphasis supplied)  

In  Balmokand Khatri Educational and Industrial Trust v. State of Punjab  

(1996)  4  SCC  212,  the  Court  negatived  the  argument  that  even  after  

finalization of the acquisition proceedings possession of the land continued  

with the appellant and observed:

“It  is  seen  that  the  entire  gamut  of  the  acquisition  proceedings  stood  

completed by 17-4-1976 by which date possession of the land had been  

taken.  No  doubt,  Shri  Parekh  has  contended  that  the  appellant  still  

retained their  possession.  It  is  now well-settled legal  position that  it  is  

difficult  to  take  physical  possession  of  the  land  under  compulsory  

acquisition.  The  normal  mode  of  taking  possession  is  drafting  the  

panchnama in the presence of panchas and taking possession and giving  

delivery to the beneficiaries is the accepted mode of taking possession of  

the  land.  Subsequent  thereto,  the  retention  of  possession  would  

tantamount only to illegal or unlawful possession”.

In P.K.  Kalburqi  v.  State of  Karnataka (2005)  12 SCC 489,  the Court  

referred  to  the  observations  made  by  Bhagwati,  J.  in Balwant  Narayan  

Bhagde v. M.D. Bhagwat (supra) that no hard and fast rule can be laid down  

as to what act would be sufficient to constitute taking of possession of the

acquired land and observed that when there is no crop or structure on the  

land only symbolic possession could be taken.

In  NTPC  v.  Mahesh  Dutta  (2009)  8  SCC  339,  the  Court  noted  that  

appellant  NTPC  paid  80  per  cent  of  the  total  compensation  in  terms  of  

Section  17(3A)  and  observed  that  it  is  difficult  to  comprehend  that  after  

depositing that much of amount it had obtained possession only on a small  

fraction of land.

In Sita Ram Bhandar Society v. Govt. of NCT, Delhi (2009) 10 SCC 501  

and  Omprakash Verma v. State of Andhra Pradesh (2010) 13 SCC 158, it  

was held that when possession is to be taken of a large tract of land then it is  

permissible to take possession by a properly executed panchnama. Similar  

view was expressed in the recent judgment in  Brij Pal Bhargava v. State of   

UP 2011(2) SCALE 692.

The same issue was recently considered in  C.A.  No.  3604 of  2011 –  

Banda  Development  Authority,  Banda  v.  Moti  Lal  Agarwal  decided  on  

26.4.2011.  After  making  reference  to  the  judgments  in  Balwant  Narayan  

Bhagde  v.  M.D.  Bhagwat  (supra),  Balmokand  Khatri  Educational  and  

Industrial Trust v. State of Punjab (supra), P.K. Kalburqi v. State of Karnataka  

(supra), NTPC v. Mahesh Dutta (supra), Sita Ram Bhandar Society v. Govt.   

of NCT, Delhi (supra), Omprakash Verma v. State of Andhra Pradesh (supra)  

and Nahar Singh v. State of U.P. (1996) 1 SCC 434, this Court laid down the  

following principles:

“(i) No hard and fast rule can be laid down as to what act would constitute  

taking of possession of the acquired land.

(ii) If the acquired land is vacant, the act of the concerned State authority  

to go to the spot and prepare a panchnama will ordinarily be treated as  

sufficient to constitute taking of possession.

(iii) If crop is standing on the acquired land or building/structure exists,  

mere going on the spot by the concerned authority will, by itself, be not

sufficient for taking possession. Ordinarily, in such cases, the concerned  

authority will have to give notice to the occupier of the building/structure  

or the person who has cultivated the land and take possession in the  

presence  of  independent  witnesses  and  get  their  signatures  on  the  

panchnama.  Of  course,  refusal  of  the  owner  of  the  land  or  

building/structure may not lead to an inference that the possession of the  

acquired land has not been taken.

(iv) If the acquisition is of a large tract of land, it may not be possible for  

the acquiring/designated authority to  take physical  possession of  each  

and  every  parcel  of  the  land  and  it  will  be  sufficient  that  symbolic  

possession is taken by preparing appropriate document in the presence  

of independent witnesses and getting their signatures on such document.

(v)  If  beneficiary  of  the  acquisition  is  an  agency/instrumentality  of  the  

State and 80% of the total compensation is deposited in terms of Section  

17(3A) and substantial portion of the acquired land has been utilised in  

furtherance  of  the  particular  public  purpose,  then  the  Court  may  

reasonably  presume  that  possession  of  the  acquired  land  has  been  

taken.”

If the present case is examined in the light of the facts which have been  

brought  on record and the principles laid  down in the judgment  in  Banda  

Development Authority's  case, it  is  not  possible to sustain the finding and  

conclusion recorded by the High Court that the acquired land had vested in  

the State Government  because the actual  and physical  possession of  the  

acquired land always remained with the appellants and no evidence has been  

produced  by  the  respondents  to  show  that  possession  was  taken  by  

preparing a panchnama in the presence of independent witnesses and their  

signatures were obtained on the panchnama.

A reading of the Khasra Girdawari and Jamabandis, copies of which have  

been placed on record,  shows that  actual  and physical  possession of  the

acquired land is still with the appellants. Jamabandis relate to the year 2005-

2006.  Copies  of  notice  dated  10/11.2.2011  issued  by  Uttar  Haryana  Bijli  

Vitran Nigam Ltd. relates to appellant No.1 – Prahlad Singh and this, prima  

facie, supports the appellants' assertion that physical possession of the land  

is still  with them. Respondent Nos. 3 to 6 have not placed any document  

before this Court to show that actual possession of the acquired land was  

taken  on  the  particular  date.  Therefore,  the  High  Court  was  not  right  in  

recording a finding that the acquired land will be deemed to have vested in  

the State Government.

The judgments, which have been referred to in the impugned order really  

do not have any bearing on the case in hand because in all those cases, the  

Court had found that possession of the acquired land had been taken.

In  Municipal Corporation of Greater Bombay v. Industrial  Development  

and Investment Company (P) Ltd. (supra), this Court declined to interfere with  

the acquisition proceedings on the ground of delay. The facts of that case  

were that after preparation of the draft development plan for 'G' Ward of the  

Bombay Municipal Corporation, notification dated 6.7.1972 was issued under  

Section 126(2) of the Maharashtra Regional and Town Planning Act, 1966 for  

the  acquisition  of  land  needed  for  implementing  the  development  plan.  

Respondent Nos.1 and 2, who were in possession of the land as tenants,  

filed claim for compensation. They were heard by the competent authority in  

1979.  In  the  meanwhile,  the  Bombay  Metropolitan  Region  Development  

Authority Act, 1974 was enacted by the State Legislature and notifications  

were issued under that Act. In 1979, City Survey No.503 was de-reserved  

from the earlier public purpose of locating the extension of Dharavi Sewage  

Purification  Plant  and  the  entire  land  was  to  be  utilized  for  residential,  

commercial, para-commercial and social facilities by the local residents of the  

area. After the award was made by the Collector, possession of the acquired  

land was taken. The respondents filed writ petition after lapse of four years  

from the date of taking possession. The learned Single Judge dismissed the

writ petition but the Division Bench allowed the appeal. This Court held that  

once  the  award  was  passed  and  possession  was  taken,  the  High  Court  

should not have exercised its power to quash the award.

In  C.  Padma v.  Deputy  Secretary  to  the  Government  of  Tamil  Nadu  

(supra),  the  Court  held  that  once  the  acquired  land  vested  in  the  State  

Government  and  compensation  was  paid  after  taking  possession,  the  

appellant was not entitled to question the acquisition proceedings.

In Municipal Council, Ahmednagar v. Shah Hyder Beig (supra), this Court  

reversed the judgment of the Bombay High Court on the ground that they had  

moved the Court after 21 years of the issue of notifications under Section 6  

and 16 years from the date of making an award and taking of possession.

The same view was reiterated in  Swaika Properties (P) Ltd. v. State of   

Rajasthan (supra). In that case, the writ petition was filed in 1989 after the  

award was passed and possession of the acquired land was taken.

In  Sawaran  Lata  v.  State  of  Harayana  (supra),  the  landowners  were  

denied relief because they had approached the High Court after 8 years of  

the notification issued under Section 4(1) and about 5 years of the passing of  

award and taking of possession.

In the result, the appeal is allowed. The impugned order is set aside and  

the matter is remitted to the High Court for disposal of the writ petition on  

merits. The parties are left to bear their own costs.