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REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL  NO. 3971 OF 2006

Lt. Governor of Delhi & Ors.       ... Appellant (s)

Versus

Matwal Chand (D) Thr. LRs.                ...    Respondent(s)

J U D G M E N T

RANJAN GOGOI, J.

1. The  challenge  in  this  appeal  is  to  an  order  dated

15.04.2004  passed  by  the  High  Court  of  Delhi  in  two  writ

petitions  raising identical  questions of  law on similar  facts.

The writ petitions filed by the respondent have been allowed

and the acquisition proceedings under the Land Acquisition

Act, 1894 (in short ‘the LA Act’) have been declared null and

void.  Aggrieved, the Delhi Administration has filed the instant

appeal.  2. The core facts lie in a short compass and are as follows:

The subject  land,  admittedly,  was  evacuee property.  It

was  acquired  under  Section  12  of  the  Displaced  Persons

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(Compensation  and  Rehabilitation)  Act,  1954  (in  short  ‘the

DPCR Act’).  Thereafter  the  property  was  transferred  to  the

compensation  pool  under  Section  14  of  the  said  Act.  A

decision was taken to transfer the subject property out of the

compensation pool to displaced persons.  In an auction held

on 6.8.1958 the predecessors of the respondents (hereinafter

referred to as the respondents) offered the highest bid which

was accepted on 15.10.1958. After adjustment of the verified

claims,  the  respondents  were  asked  to  deposit  the  balance

price within 15 days which was so done. On 10.3.1959, the

respondents were informed by the appellant that their bid has

been accepted and provisional  possession of the property is

being handed over to them.

 3. On 13.11.1959 a notification under Section 4 of the LA

Act was issued proposing to acquire 34070 acres of land in

several  villages  including  Village  Basai  Darapur  where  the

subject  land was situated.  The notification under  Section 4

specifically  excluded  from  the  purview  of  the  acquisition

Government and evacuee land. After the Section 4 notification

was issued and prior to the declaration under Section 6 made

on 6.1.1969, the sale certificate was issued in respect of the

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subject land on 25.1.1962. The same which was registered on

21.2.1962 clearly recites that the respondents are declared as

the purchasers of the property with effect from 25.1.1962.

4. After publication of the declaration under Section 6 on

6.1.1969, notices under Sections 9 and 10 of the LA Act were

issued on 10.1.1979. The respondents filed their claim before

the competent authority. Thereafter on 7.1.1981 the award in

respect of the subject property was passed which came to be

challenged in the writ petitions out of which this appeal has

arisen.   

5. By the impugned order the High Court on consideration

of the rival contentions and the provisions of the DPCR Act

and the facts set out above came to the conclusion that the

subject  land  was  evacuee  property  on  the  date  of  the

notification issued under Section 4 of the LA Act and as the

said notification had exempted evacuee land from the purview

of acquisition,  the proceedings for acquisition,  including the

award, were null and void.

6. Before us, Ms. Rachana Srivasatava learned counsel for

the  appellant  has  urged  that  the  subject  property,  though

evacuee property, ceased to be so upon acquisition of the same

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under Section 12 of  the DPCR Act.   It  is  urged that  under

Section  12(2)  of  the  said  Act,  upon  publication  of  the

notification under sub-section (1), the right, title and interest

of any evacuee in the evacuee property stands extinguished

and  the  evacuee  property  vests  absolutely  in  the  Central

Government  free  from all  encumbrances.  Under  sub-section

(4) of Section 12 all such evacuee property acquired becomes a

part  of  the  compensation  pool  which  vests  in  the  Central

Government under Section 14(2) of the DPCR Act. Pointing out

the provisions of the Section 20 of the DPCR Act, it is urged

that  property  included  in  the  common  pool  may  be  sold,

leased, allotted or otherwise transferred to a displaced person.

It is therefore urged that upon the acquisition of the subject

property under Section 12 of the DPCR Act the same had shed

its  character  as  evacuee  property  and  by  operation  of  the

provisions of the Act the property stood vested in the Central

Government.  The  exemption  clause  contained  in  the

notification under Section 4 of the LA Act issued in the present

case  on  13.11.1959,  in  so  far  as  evacuee  property  is

concerned, therefore, has no application to the subject land.

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7. It is further argued that though in the present case the

sale  certificate  in  respect  of  the  property  was  issued  on

25.1.1962  and  the  property  therein  was  transferred  to  the

respondents  with  effect  from  the  said  date,  there  is  no

inherent contradiction between the transfer of title in favour of

the respondents on a subsequent date and the acquisition of

the property or initiation of such process of acquisition on a

prior date. In this regard placing reliance on a judgment of this

Court  in  Saraswati  Devi  (Dead)  by  LR  vs.  Delhi

Development Authority & Ors.,1 it is contended that the bid

offered  by  the  respondent;  the  acceptance  thereof  and  the

delivery of provisional possession creates an encumbrance on

the subject land which is amenable to a process of acquisition

under the LA Act as held in Saraswati Devi (supra).  

8. Reliance  has  also  been  placed  on  a  judgment  of  this

Court  in  Delhi  Administration  &  Ors.  Vs.  Madan  Lal

Nangia & Ors.2 to contend that the evacuee property vests in

the  Custodian  for  the  purposes  contemplated  by  the

Administration  of  Evacuee  Property  Act,  1950   and  in  the

1

2013 (3) SCC 571 2 2003 (10) SCC 321

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Central Government only after the notification of acquisition

under  Section  12  of  the  DPCR Act  is  issued  but  not  prior

thereto.  

9. On the other hand learned counsel appearing on behalf

of  the  respondents  has  contended  that  the  acquisition  of

evacuee property by the Central Government under Section 12

of  the  DPCR  Act  and  the  transfer  of  such  land  to  the

compensation pool under Section 14 does not divest the status

of  the  subject  land  as  evacuee  property.  Pointing  out  the

provisions of the two enactments i.e. the DPCR Act and the

Administration of Evacuee Property Act, it is contended that

while  the  object  and  purpose  of  the  latter  Act  is  the

administration  of  evacuee  property  by  the  custodian  in

accordance  with  the  provisions  thereof,  acquisition  of  such

property  for  inclusion  in  the  common pool  for  allotment  of

such  land  to  displaced  persons  is  contemplated  under  the

DPCR Act. The transfer of evacuee land to the common pool by

issuance of a notification under Section 12 of the DPCR Act

does not change the character of the land which continues to

remain  evacuee  property.  Hence  it  is  contended  that  the

subject land is covered by the exemption clause of the Section

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4 notification dated 13.11.1959.  It  is also urged that  if  by

virtue of Section 12 of the DPCR Act the property is vested in

the  Central  Government  it  cannot  be  understood  how  the

Central  Government  could  have  initiated  the  process  of

acquisition of its own property under the provisions of the LA

Act.  

10. Learned counsel has further argued that in the present

case  in  terms  of  the  expressed  stipulation  in  the  sale

certificate  dated  25.1.1962  to  the  said  effect,  the  property

stood transferred in the name of the respondents with effect

from the said date and not from any anterior date including

the  date  of  payment  of  the  full  amount  due.   This  is

notwithstanding the fact that under Rule 90 of the Rules of

1955 for sale of properties forming part of the compensation

pool, the sale certificate only formalises the transfer which is

effective from the date of payment of the full price.  Relying on

the clear terms embodied in the sale certificate issued in the

present case it is argued that the subject land continued to

vest  in  the  Central  Government  until  25.1.1962 and  hence

could  not  have  been  acquired  by  the  notification  dated

13.11.1959 under Section 4 of the LA Act, the said date being

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anterior  to  the  date  of  transfer  of  title  in  favour  of  the

respondents.   

11. Two questions as set out below, in our considered view,

arise for determination in the present case. (i) Whether  the  land,  after  issuance  of  notification

under  Section  12  of  the  DPCR Act,  ceased  to  be

evacuee  property  so  as  to  be  excluded  from  the

purview of the notification issued under Section 4 of

the LA Act? (ii) If the subject land vested in the Central Government

upon publication of the notification under Section

12  of  the  DPCR  Act  and  thereby  ceased  to  be

evacuee land, could such land vested in the Central

Government be acquired under the provisions of the

LA Act? 12. A  reading  of  the  provisions  of  the  Administration  of

Evacuee Property Act, 1950 would go to show that the said Act

(since repealed with effect from 5.9.2005) had been enacted for

the  administration  of  evacuee  property  and  for  matters

connected therewith. While it will not be necessary to set out

the definition of “evacuee” and “evacuee property” as defined

in the said Act regard must be had to the provisions of Section

6  which  contemplated  appointment  by  the  Central

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Government by means of a notification in the official gazette, a

Custodian for any State for discharge of duties under the Act.

Section 7 empowers the Custodian to declare any property as

an evacuee property after issuance of appropriate notice in the

manner prescribed and after holding an inquiry in the matter.

Under  Section 8 any property  declared as evacuee property

under Section 7 is deemed to have vested in the Custodian.

Possession of all  such properties is to be taken over by the

Custodian under Section 9 of the Act. Section 10 deals with

the powers and duties of the Custodian and may be usefully

extracted herein below.  

“10 - Powers and duties of the Custodian generally- (1) Subject to the provisions of any rules that may be  made  in  this  behalf,  the  Custodian  may  take such  measures  as  he  considers  necessary  or expedient  for  the  purposes  of  securing, administering,  preserving  and  managing  any evacuee property and generally for the purpose of enabling him satisfactorily to discharge any of the duties  imposed on him by or  under  this  Act  and may, for any such purpose as aforesaid, do all acts and  incur  all  expenses  necessary  or  incidental thereto.

(2) Without  prejudice  to  the  generality  of  the provisions  contained  in  sub-  section  (1),  the Custodian may, for any of the purposes aforesaid,--

(a) carry on the business of the evacuee;

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provides  that  on  publication  of  a  notification  under

sub-section (1) of  Section 12 “the right, title and interest of

any  evacuee  in  the  evacuee  property  specified  in  the

notification shall,  on and from the beginning of the date on

which the notification is so published be extinguished and the

evacuee  property  shall  vest  absolutely  in  the  Central

Government free from all encumbrances.” Under sub-section

(4) of Section 12 all such evacuee property acquired forms part

of the compensation pool which under Section 14 vests in the

Central Government “free from all encumbrances and shall be

utilised in accordance with the provisions of this Act and the

rules  made  thereunder”.  The  vesting  of  the  property  in  the

Custodian under the Administration of Evacuee Property Act

(Section 8) and in the Central Government (after issuance of

Section 12 notification under the DPCR Act) are two distinct

and different  phases which are contemplated to be brought

into  effect  by  specific  acts  and  conscious  decisions  as

contemplated by the  provisions of  the  two enactments.  The

clear  language  of  Section  8  of  Administration  of  Evacuee

Property Act and Sections 12(2) & (4) and 14 of the DPCR Act

makes it abundantly clear that the transition from the vesting

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of  the  evacuee  property  in  the  Custodian  to  the  Central

Government is a distinct and identifiable process under the

law. The acquisition of the land under Section 12 of the DPCR

Act brings the evacuee property into a common pool which is

to  be utilised in accordance with the  provisions of  the  Act.

Specifically, once the property is included in the common pool

and vests in the Central Government, under Section 16 of the

DPCR Act, the Central Government may take such measures

as  it  considers  necessary  or  expedient  for  the  custody,

management and disposal of such property including transfer

of the property out of the compensation pool to a displaced

person.  In  the  face  of  the  clear  provisions  of  the  two

enactments  and  the  respective  schemes  contemplated

thereunder,  it  is  difficult  to  hold  that  the  evacuee property

continues  to  retain  such  status  after  issuance  of  the

notification under Section 12 of the DPCR Act.   In fact the

above view would find resonance in an old vintage decision in

Major  Gopal  Singh  and  Others  vs.  Custodian,  Evacuee

Property, Punjab an Others3 though rendered in a somewhat

different context.  The relevant details thereof in para 9 may be

extracted below.   3 AIR 1961 SC 1320

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“9.    Section 12 of  the  1954  Act  empowers  the Central Government to acquire evacuee property for rehabilitation of displaced persons by publishing in the official gazette a notification to the effect that it has  decided  to  acquire  such  evacuee  property  in pursuance of this provision. …………………………… Sub-section 2 of s.12 of the Act provides that on the publication of  the  notification under  sub-s.  1  the right, title or interest of any evacuee in the property specified in the notification shall immediately stand extinguished and that property shall vest absolutely in  the  Central  Government  free  from  all encumbrances. The power of the Custodian under the Administration of Evacuee Property Act, 1950, to  allot  any property  to a person or  to cancel  an allotment existing in favour of a person rests on the fact  that  the  property  vests  in  him.  But  the consequence of the publication of the notification by the  Central  Government  under  s.  12(1) of  the Displaced  Persons  (Compensation  and Rehabilitation) Act with respect to any property or a class of property would be to divest the Custodian completely of his right in the property flowing from s.8 of  the Administration of Evacuee Property Act, 1950,  and  vest  that  property  in  the  Central Government. He would, therefore, not be competent to  deal  with  the  property  in  any  manner  in  the absence  of  any  provision  in  either  of  these  two enactments permitting him to do so. No provision was, however, pointed out to us in either of these Acts whereunder despite the vesting of the property in  the  Central  Government  the  Custodian  was empowered to deal with it. Sub-s. 4 of s. 12 of the 1954  Act  provides  that  all  evacuee  property acquired under that section shall form part of the compensation pool.  Under  s.  16(1) of  this  Act  the Central  Government  is  empowered  to  take  such measures as it considers necessary or expedient for the  custody,  management  and  disposal  of  the compensation pool. Sub-s. 2 of s. 16 empowers the Central Government to appoint such officers as it deems  fit  or  to  constitute  such  authority  or

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corporation  as  it  deems  fit  for  the  purpose  of managing and disposing of  the properties forming part of the compensation pool. Section 19 of the Act provides  that  notwithstanding  anything  contained in any contract or any other law for the time being in force but subject to the rules that may be made under  the  Act  the  managing  officer  or  managing corporation  may  cancel  any  allotment  etc.,  under which any evacuee property acquired under the Act is  held  or  occupied  by  a  person  whether  such allotment or lease was granted before or after the commencement  of  the  Act.  This  provision  thus confers  the  power  to  deal  with  evacuee  property acquired under the Act only on a managing officer appointed  or  managing  corporation  constituted under the Act and makes no mention whatsoever of the Custodian appointed under the Administration of  Evacuee Property  Act.  No doubt,  under  s.10 of the  Administration  of  Evacuee  Property  Act  the Custodian  is  empowered  to  manage  evacuee property  and  in  exercise  of  his  power  he  will  be competent to allot such property to any person or to cancel  an allotment  or  lease made in favour of  a person.  Apart from the fact that subsequent to the issue  of  the  notification  under  s.  12(1)     of  the Displaced  Persons  (Compensation  and Rehabilitation) Act, the property would cease to be evacuee  property,  the  aforesaid  powers  of  the Custodian would be in conflict with those conferred by s.19     of the 1954 Act on a managing officer or a managing corporation constituted under that Act.”  

14. In view of the above it has to be held that the subject

land ceased to  be evacuee property  after  publication of  the

notification of acquisition under Section 12 of the DPCR Act.

Consequently the exemption clause in the notification issued

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under Section 4 exempting from its purview evacuee land will

have no application to the present case.  

15. This will bring us to the second question that has been

formulated for an answer in the present appeal. In Saraswati

Devi (supra) on an exhaustive consideration of the issue with

regard to the effect of delivery of provisional possession, which

in the present case was handed over to the respondents on

approval of the highest bid, it was held that such provisional

possession gives the auction purchaser possessory rights as

distinguished  from  proprietary  rights  in  the  auctioned

property. The above proposition culled out in a judgment of

the Punjab High Court in  Roshan Lal Goswami vs. Gobind

Raj4 was approved by this  Court  to further  hold  that  such

proprietary  rights  occasioned  by  the  delivery  of  provisional

possession creates an encumbrance on the property  which

can be  the  subject  of  acquisition  under  the  LA Act.  In  the

present case also the facts being identical,  we have to hold

that  an  encumbrance  had  been  created  in  the  subject

property, which, as held in Saraswati Devi (supra), could be

acquired under the LA Act although the ownership in the land

vested in the Central Government. In this regard we must also 4 AIR 1963 Punj 532

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take note of the manner in which the earlier decision of this

Court  in  Sharda  Devi  vs.  State  of  Bihar5 has  been

understood in Saraswati Devi (supra), namely, it is only such

land in respect of which the entirety of the rights vests in the

State  and  on  which  land  there  are  no  private  rights  or

encumbrances which would be outside the purview of the LA

Act.  

16. In  view  of  the  above  discussions  we  arrive  at  the

conclusion  that  the  judgment  and  order  of  the  High  Court

under challenge in the present appeal  is  not sustainable  in

law.  We, therefore, set aside the same and allow this appeal.

..……..……......................J.                                          (RANJAN GOGOI)

….……..…….....................J.                                              (PRAFULLA C. PANT)

NEW DELHI SEPTEMBER 04, 2015.

5 2003 (3) SCC 128

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IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

I.A. NO. 12 OF 2015 IN

CIVIL APPEAL  NO. 3971 OF 2006

Lt. Governor of Delhi & Ors.       ...Appellant (s)/                                                           Non-Applicants

Versus

Matwal Chand (D) Thr. LRs.                ...Respondent/(s)                                                        Applicant(s)  

O R D E R

This  application  seeks  directions  that  the  subject  land

acquisition proceedings are deemed to have lapsed under Section

24(2) of the Right to Fair Compensation & Transparency in Land

Acquisition, Rehabilitation and Resettlement Act, 2013.

In view of the issues raised and the consistent orders of this

Court on similar applications, we leave it open to the respondents to

approach the appropriate forum, if they are so advised, to initiate

appropriate  proceedings  under  Section  24  of  the  Right  to  Fair

Compensation & Transparency in Land Acquisition, Rehabilitation

and Resettlement Act, 2013.  Any such approach, if made,  shall be

within eight weeks from today.

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The I.A. stands disposed of in the above terms.

...……..……......................J.                                             (RANJAN GOGOI)

….……..…….....................J.                                                  (PRAFULLA C. PANT)

NEW DELHI SEPTEMBER 04, 2015.