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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.  8003  OF 2019 (ARISING OUT OF S.L.P. (C) NO.24726/2019

   D.NO.25495 OF 2019)

SHIV KUMAR & ANR. …APPELLANT(S)

VERSUS

UNION OF INDIA & ORS. …RESPONDENT(S)

J U D G M E N T  

ARUN MISHRA, J.

1. The question involved in the matter is whether a purchaser of

the property after issuance of notification under section 4 of the Land

Acquisition Act, 1894 (for short, “the 1894 Act”), can invoke the

provisions contained in section 24 of the Right to Fair Compensation

and Transparency in Land Acquisition, Rehabilitation and

Resettlement Act, 2013 (for short, "the Act of 2013").

2. Notification No.F.10(29)/96/L&B/LA/11394, dated 27.10.1999,

was issued  for the  acquisition of the land situated in the revenue

estate of Village Pansali, Delhi, for the public purpose of the Rohini

Residential Scheme under planned development of Delhi.   It was

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followed by the declaration under section 6 issued on 3.4.2000.

Possession was  taken on 12.5.2000.  Subsequently, the petitioners

purchased the land           on 5.7.2001 by way of Registered Sale Deed

executed by one Satya Narain, the Power of Attorney holder of original

owners.   The purchasers then participated in the proceedings for the

determination of compensation under sections 9 and 10 of the 1894

Act.   The award was passed on 3.4.2002. In the meanwhile, an

unauthorized colony came up with the name of Deep Vihar, Pansali,

Pooth Kalan, Delhi.  The petitioners claimed that they continued in the

actual physical possession of the land even after passing of the award

on 17.09.2008 and the same formed part of the unauthorized colony.

The Government of NCT of Delhi provisionally regularised the colony.

The Act of 2013 came in force from 1.1.2014.  The respondents never

took the actual physical possession of the land; as such, the

acquisition has lapsed.   The purchasers/ petitioners filed a writ

petition at  the High Court of  Delhi.  A Division Bench of  the High

Court has dismissed the writ application.

3. Learned counsel appearing on behalf of the purchasers

submitted that the High Court has erred in rejecting the writ

application on the ground that the purchasers after issuance of

notification under section 4 of the 1894 Act cannot question the land

acquisition.   The decision runs contrary to the dictum laid down by

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this Court in Government (NCT of Delhi) v. Manav Dharam Trust & Anr.

(2017) 6 SCC 751.   Learned counsel further submitted that the High

Court has also erred in dismissing the writ application on the ground

that petitioners have admitted that the property is part of the

unauthorized colony of Deep Vihar.

4. Shri K.M. Natraj learned Additional Solicitor General has

supported the impugned judgment and order and submitted that the

purchase made after the notification  issued under section 4 of the

1894 Act and declaration under section 6 is void.  The purchasers had

acquired no right, and they cannot question the land acquisition, nor

they can invoke the provisions contained in section 24 of the Act of

2013.  It was further submitted that decision in Manav Dharam Trust

(supra) is per incuriam because of a large number of decisions of this

Court holding that sale made after issuance of notification under

section 4 is void.

5. It is crystal clear that for seeking the relief under section 24, the

proceedings for taking possession under Act of 1894 have been put

into question as illusory one, and possession continues with

appellants.  The  decision in  Manav  Dharam Trust  (supra)  has  been

mainly relied upon by the learned counsel appearing on behalf of the

purchasers/ petitioners in which a Division Bench opined that

subsequent purchasers are affected by the acquisition. Therefore, they

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are entitled to seek a declaration of the lapse of acquisition under the

Act of 2013. It has further opined that since declaration is sought, the

challenge is not to the acquisition proceedings.   Because of the

operation of  section 24(2)  of  the 2013 Act,  the ratio of the various

cases decided by this Court under the Act of 1894, has no application

to such situations.  It has observed thus:

“21. All the decisions cited by the learned Senior Counsel appearing for  the  appellants,  no  doubt,  have  categorically  held  that  the subsequent  purchasers  do  not  have  locus  standi  to  challenge  the acquisition proceedings. However, in the present case, the challenge is not to the acquisition proceedings; it is only for a declaration that the acquisition  proceedings  have  lapsed  because  of  the  operation  of Section 24(2) of the 2013 Act, and therefore, the ratio in those cases has no application to these cases.  22. It is one thing to say that there is a challenge to the legality or propriety or validity of the acquisition proceedings and yet another thing to say that by virtue of the operation of subsequent legislation, the acquisition proceedings have lapsed.  23. In all the decisions cited by the learned Senior Counsel for the appellants, which we have referred to above, this Court has protected the rights of the subsequent purchaser to claim compensation, being a person interested in the compensation, despite holding that they have no locus standi to challenge the acquisition proceedings. 28. Thus,  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 2013 Act. 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."  

6. First, we advert to the legal position concerning the purchases

made on 5.7.2001, made after notification under Section 4 had been

issued under the Act of 1894. Law is well settled in this regard by a

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catena of decisions of this Court that an incumbent, who has

purchased the land after section 4 notification, has no right to

question the acquisition.  

6(a). In U.P. Jal Nigam, Lucknow through its Chairman & Anr. v. Kalra

Properties (P) Ltd., Lucknow & Ors. (1996) 3 SCC 124 it was observed :

“3. …...That apart, since M/s. Kalra Properties, the 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  the publication of the declaration under Section 6 was published."

6(b). In Sneh Prabha (Smt.) & Ors. v. State of U.P. & Anr. (1996) 7 SCC

426  it  has been  laid down that subsequent purchaser cannot take

advantage of land policy.  It was observed:

"5. Though at first blush, we were inclined to agree with the appellant but on a 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 the publication of the notification under  Section 4(1),  does so at  his/her  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 a public purpose, and the acquisition proceedings point  out  an  impediment  to  anyone  to  encumber  the  land acquired thereunder. It authorizes 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. Shri  Shivkumar  Bhargava  and  Ors.  [1995]  1  SCR  354

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considered  the  controversy  and  held  that  a  person  who purchases land subsequent to the notification is not entitled to an  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 purchaser was elbowed out from the policy and became disentitled to the benefit of the Land Policy."

6(c). In  Meera Sahni v. Lieutenant Governor of Delhi & Ors.  (2008) 9

SCC 177, the Court had relied upon the decision described above and

observed thus:  

"21. In view of the aforesaid decisions, it is by now well-settled law  that  under  the  Land  Acquisition  Act,  the  subsequent purchaser cannot challenge the acquisition proceedings and that he would be only entitled to get the compensation."

6(d). In  V.  Chandrasekaran  & Anr. v.  Administrative  Officer  & Ors.

(2012) 12 SCC 133, the Court has considered various decisions and

opined that the purchaser after Section 4 notification could not

challenge land  acquisition  on any ground  whatsoever.   The  Court

observed:

"15. The issue of maintainability of the writ  petitions by the person  who  purchases  the  land  subsequent  to  a  notification being issued under Section 4 of the Act has been considered by this Court time and again. In Leela Ram v. Union of India AIR 1975 SC 2112, this Court held that anyone who deals with the land subsequent to a Section 4 notification being issued, does so, at his own peril. In Sneh Prabha v. State of Uttar Pradesh AIR 1996 SC 540, this Court held that a Section 4 notification gives a notice to the public at large that the land in respect to which it has been issued, is needed for a public purpose, and it further points out that there will be "an impediment to anyone to encumber the land acquired thereunder." The alienation after that  does  not  bind  the  State  or  the  beneficiary  under  the acquisition.  The  purchaser  is  entitled  only  to  receive compensation.  While  deciding  the  said  case,  reliance  was placed on an earlier judgment of this Court in Union of India v. Shiv Kumar Bhargava and Ors. (1995) 2 SCC 427.

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18.  In  view  of  the  above,  the  law  on  the  issue  can  be summarized  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 does not confer upon him, any title and at the most he can claim compensation on the basis of his vendor's title.”

(emphasis supplied)

6(e). In Rajasthan State Industrial Development and Investment Corpn.

v. Subhash Sindhi Cooperative Housing Society, Jaipur & Ors. (2013) 5

SCC 427, it is laid down:

“13. There can be no quarrel with respect to the settled legal proposition that  a purchaser,  subsequent  to the issuance of a Section 4 Notification in respect of the land, cannot challenge the acquisition proceedings, and can only claim compensation as  the  sale  transaction  in  such  a  situation  is  Void  qua  the Government. Any such encumbrance created by the owner, or any  transfer  of  the  land  in  question  that  is  made  after  the issuance of such a notification would be deemed to be void and would not be binding on the Government. (Vide: Gian Chand v. Gopala and Ors. (1995) 2 SCC 528; Yadu Nandan Garg v. State of Rajasthan and Ors. AIR 1996 SC 520; Jaipur Development Authority v. Mahavir Housing Coop. Society, Jaipur, and Ors. (1996) 11 SCC 229; Secretary, Jaipur Development Authority, Jaipur v. Daulat Mal Jain and Ors. (1997) 1 SCC 35; Meera Sahni v. Lieutenant Governor of Delhi and Ors. (2008) 9 SCC 177;  Har  Narain (Dead)  by L.Rs.  v.  Mam Chand (Dead)  by L.Rs. and Ors. (2010) 13 SCC 128; and V. Chandrasekaran and Anr.  v. The Administrative Officer and Ors. JT 2012 (9) SC 260)."

(emphasis supplied)

6(f). A Three­Judge Bench in  Rajasthan Housing Board v. New Pink

City  Nirman Sahkari  Samiti  Ltd.  & Anr., (2015)  7  SCC 601, in the

context of section 4 as well as section 42 of the Rajasthan Tenancy Act

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which also prohibited the transactions from being entered into with

SC/ST persons, has observed:

“33.  The  other  decision  relied  upon  by  the  Society  is  V. Chandrasekaran and Anr.  v.  Administrative Officer  and Ors. 2012 (12) SCC 133] wherein this Court laid down thus:

17. In Ajay Kishan Singhal v. Union of India: AIR 1996 SC 2677; Mahavir and Anr. v. Rural Institute, Amravati and Anr. (1995) 5 SCC 335; Gian Chand v. Gopala and Ors. (1995) 2 SCC 528; and Meera Sahni v. Lieutenant Governor  of  Delhi  and  Ors.  (2008)  9  SCC 177,  this Court  categorically  held  that  a  person who purchases land  after  the  publication  of  a  Section  4  notification with  respect  to  it,  is  not  entitled  to  challenge  the proceedings for the reason, that his title is void and he can at best claim compensation on the basis of vendor's title. In view of this, the sale of land after issuance of a Section 4 notification is void, and the purchaser cannot challenge the acquisition proceedings.  (See also: Tika Ram v. the State of U.P. (2009) 10 SCC 689).

18. In view of the above, the law on the issue can be summarized 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 does not confer upon him, any title and at the most he can claim compensation on the basis of his vendor's title.

34.  Reliance  has  been  placed  on  Dossibai  Nanabhoy Jeejeebhoy v. P.M. Bharucha 1958 (60) Bom.LR 1208] so as to contend that the 'person interested' in the land under Section 9 of the Land Acquisition Act would include a person who claims interest in compensation to be paid on account of acquisition of land  ad  the  interest  contemplated  Under  Section  9  is  not restricted to legal or proprietary estate or interest in the land but such interest  as will  sustain a claim to apportionment,  is  the owner of the land. In our opinion, the decision is of no avail. The  instant  transaction  being  void  as  per  Section  42  of  the Rajasthan  Tenancy  Act,  and  the  property  was  inalienable  to non-SC. Obviously, the logical corollary has to be taken that no right in apportionment to compensation can be claimed by the Society."

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6(g). In M. Venkatesh & Ors. v. Commissioner, Bangalore Development

Authority, etc. (2015) 17 SCC 1, a three­Judge Bench has opined:

“16. That brings us to the question of whether Prabhaudas Patel and  other  respondents  in  SLP (C)  No.  12016  of  2013  were entitled to any relief from the Court. These respondents claim to  have  purchased the  suit  property  in  terms  of  a  sale  deed dated 22-8-1990, i.e., long after the issuance of the preliminary Notification published in July 1984. The legal position about the  validity  of  any  such  sale,  post-issuance  of  preliminary notification, is fairly well settled by a long line of the decisions of this Court. The sale in such cases is void and non-est in the eye of the law giving to the vendee the limited right to claim compensation and no more. Reference may in this  regard be made to the decision of this Court in U.P. Jal Nigam v. Kalra Properties (P) Ltd, wherein this Court said: (SCC pp. 126-27, para 3)

“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 24-3-1973; possession of the  land  admittedly  was  taken  on  5-7-1973,  and  the pumping  station  house  was  constructed.  No  doubt, declaration under Section 6 was published later on 8-7- 1973.  Admittedly  power  under  Section  17(4)  was exercised dispensing with the inquiry under Section 5-A 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  floodwater. 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  11-A,  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 is surrendered pursuant thereto.  That apart, since  M/s  Kalra  Properties,  the  respondent  had purchased the land after the notification under Section 4(1) was published, its sale is void against the State, and

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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  the  publication  of  the declaration under Section 6 was published.

(emphasis supplied)"

7. It has been laid down that the purchasers on any ground

whatsoever  cannot  question  proceedings for taking  possession.  A

purchaser after Section 4 notification does not acquire any right in

the land as the sale is ab initio void and has no right to claim land

under the Policy.  

8. When we ponder as to beneficial provisions of the Act of 2013,

they also intend to benefit landowners mentioned in the notification

under Section 4, not for the benefit of such purchasers who purchase

the land after it has been vested in the State.  

9. Sub­section 4 of Section 11 of the Act of 2013, which is akin to

section 4 of the Act of 1894, contains a prohibition that no person

shall make any transaction or cause any transaction of land or create

any encumbrance on land from the date of publication of such

notification. Section 11(4) is extracted hereunder:  

“11. Publication of preliminary notification and power of officers thereupon.–

                                                         x x x x x (4) No person shall make any transaction or cause any transaction of land  specified  in  the  preliminary  notification  or  create  any encumbrances  on  such  land  from  the  date  of  publication  of  such notification till  such time as the proceedings under this Chapter are completed:

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    Provided that the Collector may, on the application made by the owner of the land so notified, exempt in special circumstances to be recorded in writing, such owner from the operation of this subsection:      Provided further that any loss or injury suffered by any person due to his wilful violation of this provision shall not be made up by the Collector.”

Without seeking exemption from the Collector, there is a total

prohibition  on  any transaction  of land.  Whereas the legal  position

under the Act of 1894 was that a transaction effected after section 4

notification was illegal and void.  

10. When we consider other provisions, the ‘affected family' has been

defined under section 3(c)  of  the 2013 Act.  The definition reads as

under:   

“3. Definitions.–In this Act, unless the context otherwise requires,—

(c) “affected family” includes—  (i) a family whose land or other immovable property has been acquired;  (ii) a family which does not own any land but a member or members of such family may be agricultural labourers, tenants including any form of tenancy or holding of usufruct right,  share-croppers or artisans or who may be working in the affected area for three years prior to the acquisition  of  the  land,  whose  primary  source  of  livelihood  stand affected by the acquisition of land;  

(iii) the Scheduled Tribes and other traditional forest dwellers who have lost any of their forest rights recognized under the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 (2 of 2007) due to acquisition of land;

(iv) family whose primary source of livelihood for three years prior to the acquisition of the land is dependent on forests or water bodies and includes gatherers of forest produce, hunters, fisherfolk and boatmen, and such livelihood is affected due to acquisition of land;  

(v) a member of the family who has been assigned land by the State Government or the Central Government under any of its schemes and such land is under acquisition;

(vi) a family residing on any land in the urban areas for preceding three years  or  more prior  to  the acquisition of the land or whose primary

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source of livelihood for three years prior to the acquisition of the land is affected by the acquisition of such land;”

 The affected family includes landowners for whose benefit land is

held before the acquisition.   A person acquiring interest after section

11 notification cannot be said to be included in the “affected family” at

all.

11. Definition of ‘family' is in section 3(m), it is extracted hereunder:

“3. Definition.–In this Act, unless the context otherwise requires,— ….. (m)  "family"  includes  a  person,  his  or  her  spouse,  minor  children, minor  brothers  and  minor  sisters  dependent  on  him:  Provided  that widows,  divorcees,  and  women  deserted  by  families  shall  be considered separate families;

Explanation.—An adult  of  either  gender  with  or  without  spouse  or children or dependents shall be considered as a separate family for the purposes of this Act.”   

12. The definition of ‘landowner' is in section 3(r), the same is

extracted hereunder:  

“3. Definition.–In this Act, unless the context otherwise requires,— ….. (r) "landowner" includes any person,— (i) whose name is recorded as the owner of the land or building or part thereof, in the records of the authority concerned; or (ii) any person who is granted forest rights under the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act,  2006 (2 of 2007) or under any other  law for the time being in force; or  (iii) who is entitled to be granted Patta rights on the land under any law of the State including assigned lands; or (iv) any person who has been declared as such by an order of the court or Authority;”

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Landowner is a person who is recoded as the owner of land or

building.   The record of  date of  issuance of  preliminary notification

under section 11 is relevant. A purchaser after section 11 cannot be

said to be a landowner within the purview of section 3(r).

13. Person interested is defined in section 3(x) thus :

“3. Definition.–In this Act, unless the context otherwise requires,—

(x) “person interested” means—  (i)  all  persons  claiming  an  interest  in  compensation  to  be  made  on account of the acquisition of land under this Act;  (ii) the Scheduled Tribes and other traditional forest dwellers, who have lost any forest rights recognized under the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 (2 of 2007); (iii) a person interested in an easement affecting the land;  (iv)  persons  having  tenancy  rights  under  the  relevant  State  laws including share-croppers by whatever name they may be called; and  (v)  any  person  whose  primary  source  of  livelihood  is  likely  to  be adversely affected;”

14. A rehabilitation  and resettlement scheme  has to  be  prepared

under Section 16. Section 17 deals with the review of such a scheme.

An approved scheme to be made public under Section 18. Section 19

deals with the publication of declaration and summary of

rehabilitation and resettlement scheme.   After inquiry, Award is

passed by the Collector under Section 23. The Collector is required to

consider, among other things, the interest of the person claiming the

compensation, rehabilitation, and resettlement while making an

award.

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15. Section 24 of the Act of 2013, which deals with land acquisition

made under the Act of 1894, is also relevant.   The same is extracted

hereunder:

“24.  Land acquisition process  under Act No.  1  of  1894 shall  be deemed  to  have  lapsed  in  certain  cases  –  (1)  Notwithstanding anything  contained  in  this  Act,  in  any  case  of  land  acquisition proceedings initiated under the Land Acquisition Act, 1894,—  

(a) where no award under section 11 of the said Land Acquisition Act has been made, then, all provisions of this Act relating to the determination of compensation shall apply; or  

(b) where an award under said section 11 has been made, then such proceedings shall continue under the provisions of the said Land Acquisition Act, as if the said Act has not been repealed.  

(2) Notwithstanding anything contained in sub-section (1), in case of land acquisition proceedings initiated under the Land Acquisition Act, 1894 (1 of 1894), where an award under the said section 11 has been made five years or more prior to the commencement of this Act but the physical possession of the land has not been taken, or the compensation has not been paid the said proceedings shall be deemed to have lapsed and  the  appropriate  Government,  if  it  so  chooses,  shall  initiate  the proceedings  of  such  land  acquisition  afresh  in  accordance  with  the provisions of this Act:

Provided that where an award has been made, and compensation in respect of a majority of land holdings has not been deposited in the account  of  the  beneficiaries,  then,  all  beneficiaries  specified  in  the notification for acquisition under section 4 of the said Land Acquisition Act, shall be entitled to compensation in accordance with the provisions of this Act.”

(emphasis supplied)

16. Section 24 (2) provides that in case the award has been passed

five  years  or  more prior to the commencement of the Act,  but  the

physical possession of the land has not been taken, or the

compensation has not been paid, the said proceedings shall be

deemed to have lapsed.   It is not the case set up that compensation

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had not been paid to purchasers/owners.  The only case set up is that

physical possession has not been taken and proceedings of taking over

possession have been questioned to take advantage of provisions

under Section 24(2) of the Act of 2013. Whereas, averment in the writ

petition  itself indicates that possession had been taken over  in the

year 2000 and that unauthorized colonies have come up in the area.

Thus, it is  clear  that possession, if  any, is illegal,  and  in  fact, the

actual physical possession had been taken, and re­entering in

possession in an unauthorized manner can confer no right.  There is

nothing to doubt that actual physical possession had been taken in

2000.  Thus, Section 24(2) is not attracted in the case.

17. Even otherwise,  proviso  to Section 24(2)  does not recognize  a

purchaser after Section 4 notification  inasmuch as  it  provides that

where an award has been made, and the compensation in respect of a

majority of land holdings has not been deposited in the account of the

beneficiaries, then,  all  beneficiaries specified in the  notification for

acquisition issued under the Act of 1894, shall be entitled to

compensation under the provisions of the Act of 2013.   The proviso

makes it clear that in case of compensation concerning the majority of

landholding has  not  been deposited, then recorded owner(s)  at the

time of issuance of notification under section 4 of the Act of 1894 shall

have the right to receive the compensation.  Purchasers after section 4

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notification have not been given the right to receive the higher

compensation under the provisions contained in the act of 2013

18. The  Act of 2013  presupposes that a person is required to  be

rehabilitated and resettled. Such a person who has purchased after

section  4  notification  as sale  deed is void  under the  Act  of  1894,

cannot claim rehabilitation and resettlement as per policy envisaged

under the Act of 2013, as his land has not been acquired, but he has

purchased a property which has already been acquired by the State

Government, he cannot claim even higher compensation, as per

proviso to section 24(2) under the Act of 2013.  An original landowner

cannot  be deprived  of  higher value  under the  Act of 2013,  which

higher compensation was not so contemplated when the void

transaction of  sale  had been entered,  and right is  conferred under

proviso to Section 24(2) on recorded owners under Act of 1894. We

have come across instances in which after notifications under section

4 were issued and, the property was purchased at throwaway prices

by the builders and unscrupulous persons, such purchases are void

and confer no right even to claim higher compensation under Section

24(2) of the Act of 2013 as it is to be given to the owner as mentioned

in the notification.

19. Given that, the transaction of sale, effected after section 4

notification, is void, is ineffective to transfer the land, such

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incumbents cannot invoke the provisions of section 24. As the sale

transaction did not clothe them with the title when the purchase was

made; they cannot claim ‘possession' and challenge the acquisition as

having lapsed under section 24 by questioning the legality or

regularity of proceedings of taking over of possession under the Act of

1894.  It would be unfair and profoundly unjust and against the policy

of the law to permit such a person to claim resettlement or claim the

land back as envisaged under the Act of 2013. When he has not been

deprived of his livelihood but is a purchaser under a void transaction,

the outcome of exploitative tactics played upon poor farmers who were

unable to defend themselves.

20. Thus,  under the  provisions of Section  24  of the  Act of 2013,

challenge to acquisition proceeding of the taking over of possession

under the Act of 1894 cannot be made, based on a void transaction

nor declaration can be sought under section 24(2) by such

incumbents to obtain the land. The declaration that acquisition has

lapsed under the Act of 2013 is to get the property back whereas, the

transaction once void, is always a void transaction, as no title can be a

+cquired in the land as such no such declaration can be sought.   It

would not be legal, just and equitable to give the land back to

purchaser as land was not capable of being sold which was in process

of acquisition under the Act of 1894. The Act of 2013 does not confer

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any right on purchaser whose sale is  ab initio  void.   Such void

transactions are not validated under the Act of 2013.   No rights are

conferred  by the  provisions contained in the  2013  Act on such  a

purchaser as against the State.

21. ‘Void  is,  ab initio,' a nullity, is inoperative, and a person cannot

claim the land or declaration once no title has been conferred upon

him to claim that the  land should be given back to him. A person

cannot enforce and ripe fruits based on a void transaction to start

claiming title  and  possession  of the land  by  seeking  a  declaration

under Section 24 of the Act of 2013; it will amount to conferment of

benefit never contemplated by the law. The question is, who can claim

declaration/ rights under section 24(2) for the restoration of land or

lapse of acquisition. It cannot be by a person with no title in the land.

The provision of the Act  of  2013 cannot be said to be enabling or

authorizing a purchaser after Section 4 to question proceeding taken

under the Act of 1894 of taking possession as held in U.P. Jal Nigam

(supra) which is followed in M. Venkatesh (supra) and other decisions

and consequently  claim declaration under Section 24 of the Act  of

2013.   What cannot be done directly cannot be permitted in an

indirect method.

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22. The provisions of the Act of 2013 aimed at the acquisition of land

with least disturbance to the landowners and other affected families

and to provide just and fair compensation to affected families whose

land has been acquired or proposed to be acquired or are affected  and

to make adequate provisions for such affected persons for their

rehabilitation and resettlement. The provisions of Act of 2013 aim at

ousting all inter­meddlers from the fray by ensuring payment in the

bank account of landholders under section 77 of the Act.

23. The intendment of Act of 2013 is to benefit farmers etc.

Subsequent purchasers cannot be said to be landowners entitled to

restoration of land and cannot be termed to be affected persons within

the provisions of Act of 2013. It is not open to them to claim that the

proceedings have lapsed under Section 24(2).  

24. Apart from  that the claims  have  been  made on transactions

based on the power of attorneys, agreements, etc.; as such also they

are not  entitled to any  indulgence and cannot  invoke provisions of

section 24(2) of the 2013 Act.  The Court has considered the question

of the validity of transactions in the form of power of attorney in Suraj

Lamp and Industries Pvt. Ltd. through Director v. State of Haryana &

Anr. (2012) 1 SCC 656, and has held that no rights could be accrued

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on such transactions as this is not a legal mode of transfer. This Court

has observed :

"20. A power of attorney is not an instrument of transfer in regard to any right, title, or interest in an immovable property. The Power of Attorney is a creation of an agency whereby the grantor authorizes the grantee to do the acts specified therein, on behalf of the grantor, which when executed will be binding on the grantor as if done by him (see Section 1A and Section 2 of  the  Powers  of  Attorney  Act,  1882).  It  is  revocable  or terminable at any time unless it is made irrevocable in a manner known to law. Even an irrevocable attorney does not have the effect of transferring title to the grantee.    

21. In-State of Rajasthan v. Basant Nehata 2005 (12) SCC 77 this Court held:

"13. A grant of power of attorney is essentially governed by Chapter X of the Contract Act. By reason of a deed of power of attorney, an agent is formally appointed to act for the principal in one transaction or a series of transactions or to manage the affairs of the principal generally conferring necessary authority upon another person. A deed of power of attorney is executed by the principal in favor of the agent. The agent derives a right to use his name and all acts, deeds, and things are done by him and subject to the limitations contained in the said deed, the same shall be read as if done by the donor. A power of attorney is, as is well known, a document of convenience.

Execution of a power of attorney in terms of the provisions of the Contract Act as also the Powers-of-Attorney Act is valid. A power of attorney, we have noticed hereinbefore, is executed by the donor so as to enable the done to act on his behalf. Except in cases where power of attorney is coupled with an interest, it is  revocable.  The  done in  exercise  of  his  power  under  such power of attorney only acts in place of the donor subject, of course,  to  the  powers  granted  to  him by reason thereof.  He cannot use the power of attorney for his own benefit. He acts in a fiduciary capacity. Any act of infidelity or breach of trust is a matter between the donor and the done.

An  attorney  holder  may,  however,  execute  a  deed  of conveyance in the exercise of the power granted under a power of attorney and convey title on behalf of the grantor.

Scope of Will

14. A will is the testament of the testator. It is a posthumous disposition of the estate of the testator directing the distribution

21

of his estate upon his death. It is not a transfer inter vivo. The two essential characteristics of a will are that it is intended to come  into  effect  only  after  the  death  of  the  testator  and  is revocable at any time during the lifetime of the testator. It is said that so long as the testator is alive, a will is not be worth the paper on which it is written, as the testator can at any time revoke  it.  If  the  testator,  who  is  not  married,  marries  after making the will, by operation of law, the will stands revoked. (see Sections 69 and 70 of the Indian Succession Act, 1925). Registration of a will does not make it any more effective.

Conclusion

15.  Therefore,  a  SA/GPA/WILL transaction does  not  convey any title nor create any interest in an immovable property. The observations  by  the  Delhi  High  Court,  in  Asha  M.  Jain  v. Canara Bank 94 (2001) DLT 841 that the "concept of power of attorney sales have been recognized as a mode of transaction" when dealing with transactions by way of SA/GPA/WILL are unwarranted  and  not  justified,  unintended  misleading  the general  public  into  thinking  that  SA/GPA/WILL transactions are some kind of a recognized or accepted mode of transfer and that it can be a valid substitute for a sale deed. Such decisions to  the  extent  they  recognize  or  accept  SA/GPA/WILL transactions  as  concluded  transfers,  as  contrasted  from  an agreement to transfer, are not good law.

16.  We,  therefore,  reiterate  that  immovable  property  can  be legally and lawfully transferred/ conveyed only by a registered deed of conveyance. Transactions of the nature of 'GPA sales' or  'SA/GPA/WILL transfers'  do  not  convey  title  and  do not amount to transfer, nor can they be recognized or valid mode of transfer of immovable property. The courts will not treat such transactions  as  completed  or  concluded  transfers  or  as conveyances as they neither convey title nor create any interest in an immovable property. They cannot be recognized as deeds of  title,  except  to  the  limited  extent  of  Section  53A of  the Transfer  of  Property  Act.  Such transactions  cannot  be  relied upon or made the basis for mutations in Municipal or Revenue Records. What is stated above will apply not only to deeds of conveyance in regard to freehold property but also to transfer of leasehold  property.  A lease  can  be  validly  transferred  only under a registered Assignment of Lease. It is time that an end is put  to  the  pernicious  practice of  SA/GPA/WILL transactions known as GPA sales.

17.  It  has  been  submitted  that  making declaration  that  GPA sales and SA/GPA/WILL transfers are not legally valid modes of  transfer  is  likely  to  create  hardship to  a  large  number  of persons  who  have  entered  into  such  transactions,  and  they

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should be given sufficient time to regularize the transactions by obtaining deeds of conveyance.  It  is  also submitted that  this decision  should  be  made  applicable  prospectively  to  avoid hardship.”

No  right can  be  claimed  based  on  a transfer  made  by  way  of

execution of Power of Attorney, Will,  etc.,  as it does not create any

interest in immovable property.

25. In Manav Dharam Trust (supra), even the provisions of the Act of

2013 have not been taken into consideration, which prohibits such

transactions in particular provisions of section 11, including the

proviso to section 24(2).  Apart from that, it was not legally permissible

to a Division Bench to ignore the decisions of the larger Bench

comprising of three Judges and of Co­ordinate Bench. They were not

per incuriam  and were relevant for deciding the issue of taking

possession under Act of 1894, at the instance of purchaser. In case it

wanted to depart from the view taken earlier, it ought to have referred

the matter to a larger bench. It has been ignored 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 proceedings of taking possession under the Act

of 1894.  No declaration can be sought by a purchaser under Section

24 that acquisition has lapsed, effect of which would be to get back

the land.   They cannot seek declaration that acquisition made under

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the Act  of  1894 has  lapsed by the challenge to the proceedings of

taking possession under the Act of 1894.  Such right was not available

after the purchase in 2000 and no such right has been provided to the

purchasers under the Act of 2013 also. Granting a right to question

acquisition  would  be  against the  public policy and the law  which

prohibits  such  transactions; it  cannot  be given effect to  under  the

guise of subsequent legislation containing similar provisions.

Subsequent legislation  does  not confer any  new right to a  person

based on such void transaction; instead, it includes a provision

prohibiting such transactions  without permission of the Collector  as

provided in Section 11(4).

26. Thus,  we have to  follow the decisions  including that of larger

Bench mentioned above, laying down the law on the subject, which

still holds the field and were wrongly distinguished.  The binding value

of the decision of larger and coordinate Benches have been ignored

while deciding the Manav Dharam Trust case (supra), it was not open

to it to take a different view.   The decision in  Manav Dharam  Trust

(supra) is per incuriam in light of this decision of this Court in

Mamleshwar Prasad v. Kanahaiya Lal, (1975) 2 SCC 232,  A.R.

Anutulay v. R.S. Nayak, (1988) 2 SCC 602,  State of Uttar Pradesh v.

Synthetics and Chemicals Ltd., (1991) 4 SCC 139,  State of B. Shama

Rao v. Union Territory of Pondicherry,  AIR 1967 SC 1480,  Municipal

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Corporation  of  Delhi  v.  Gurnam Kaur, (1989)  1  SCC 101,  Narmada

Bachao Andolan (III) v. State of Madhya Pradesh, AIR 2011 SC 1989,

Hyder Consulting (UK) Ltd. v. State of Odisha, (2015) 2 SCC 189 and

Sant Lal Gupta v. Modern Coop. Societies Ltd. 2010 13 SCC 336.

27. We hold that  Division Bench  in  Manav Dharam Trust  (supra)

does not lay down the law correctly. Given the several binding

precedents which are available and the provisions of the Act of 2013,

we cannot follow  the  decision  in  Manav Dharam Trust  (supra)  and

overrule it.   Shri S.N. Bhatt, learned counsel submitted that in case

this Court does not agree with the  Manav Dharam Trust  (supra), the

case may be referred to Hon’ble the Chief Justice of India under the

provisions of Order VI Rule 2 of the Supreme Court Rules, 2013.  He

has relied upon the decision of this court in Vineeta Sharma v. Rakesh

Sharma (2019) 6 SCC 162 in which, in view of the conflict of opinion of

two Division Bench judgments of this Court as to the interpretation of

section 6 of the Hindu Succession Act, 1956 the matter was referred to

the Hon’ble the Chief Justice of India, for constituting an appropriate

Bench. However, in the instant case, the issue is different, whether we

have to follow the  decision in  Manav  Dharam Trust  (supra) or the

earlier decisions of this Court mentioned above.   It is apparent that

the decisions of the Three Judges Bench are binding on us, and in

view of  other  consistent  decisions  of this  Court,  we  have to follow

25

them. It  is not appropriate to refer the case to larger Bench under

Order VI Rule 2 of  Supreme Court Rules.  We find no fault in the

Judgments laying down the law that the purchase after section 4 is

void as against the State.  We are not impressed with the submission

raised on behalf of the purchasers to refer the matter for the

constitution of  a  Larger  Bench to the  Hon’ble  Chief  Justice.  When

decisions of Larger Bench and other Division Bench are available, the

case cannot be referred to a Larger Bench.

28. Concerning the illegal colony, averments have been made that

the colony  is an unauthorized and provisional order was passed to

regularise it.  The plea taken is contradictory and shows the falsity of

the claim raised by the purchasers. That, apart predecessors of the

purchaser obtained the land­based on Power of Attorney, Agreement

to Sell, and Will on 9.12.1982.   As per averments made in the writ

application, Bijender Singh, who was owning ½ share, sold the share

to Satya Narain by the documents like Agreement to Sell,  Power of

Attorney, or Will.  It has also been averred that Om Prakash sold the

remaining ½ share to Satya Narain on 11.3.1984 by way of Agreement

to  Sale, Power of  Attorney, or  Will.   The  purchase  made through

Agreement to Sale, Power of Attorney, or Will by Satya Narain did not

confer a title upon him to transfer it to the purchasers apart from the

fact that it was void in view of purchase after Section 4.   Based on

26

purchase made from such owners whose title was not perfect,

purchasers  had no derivative  title in the eye  of law.  There  was no

legally recognized title deed in favor of Satya Narain.

29. Resultantly,  we  hold that  no interference is called for in the

judgment and order passed by the High Court.   Accordingly, the

appeal is dismissed.  

…………………………. J.    (ARUN MISHRA)

…………………………. J.    (M.R. SHAH)

…………………………. J.            (B.R. GAVAI)

NEW DELHI; OCTOBER 14, 2019.