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REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOs. 1587-1636 OF 2017

SATISH KUMAR GUPTA ETC. ETC. …APPELLANTS

VERSUS

STATE OF HARYANA  &  ORS. ETC.                    ...RESPONDENTS

WITH

CIVIL APPEAL NOs.1637 OF 2017, 1638-1653 OF 2017, 1655-1658 OF 2017,  1659-1663  OF  2017,  1664  OF  2017,  1665-1669  OF  2017, 1670-1675 OF 2017, 1677-1691OF 2017, 1692 OF 2017, 1693 of 2017, 1694 of 2017, 1695 OF 2017, 1696 OF 2017, 1699-1701 OF 2017, 1702 OF  2017,  1703-1780  OF  2017,  1783-1852  OF  2017,  1853-1927  OF 2017, 1930-2003 OF 2017, 2004-2058 OF 2017, 2059-2111 OF 2017, 2112-2114  OF  2017,   2117-2118  OF  2017,  2123-2126  OF  2017, 2127-2128  OF  2017,  2129-2132  OF  2017,  2133-2138  OF  2017, 2139-2143  OF  2017,  2144-2145  OF  2017,  2146-2200  OF  2017, 2201-2203   OF   2017,  2204 of 2017, 2205-2206 OF 2017, 2207-2214 OF 2017, 2215-2219 OF 2017, 2220 OF 2017, 2221-2223 OF 2017, 2224 OF 2017, 2226-2227 OF 2017, 2228 OF 2017, 2232-2246 OF 2017 AND 2249-2279 OF 2017.

J U D G M E N T

ADARSH KUMAR GOEL, J.

1. These  appeals  have  been  preferred  against  judgment  and  order

dated  06th October,  2015  passed  by  the  High  Court  of  Punjab  and

Haryana at Chandigarh in R.F. A. Nos.4316 of 2010 etc. etc.  

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2. Question for consideration is whether a post-acquisition allottee of

land is necessary or proper party or has any locus to be heard in the

matter of determination of compensation under the scheme of the Land

Acquisition Act,  1894  (the  Act).   If  not,  whether  the  impugned  order

permitting additional evidence and directing remand is sustainable.     

3. Facts  giving  rise  to  the  question  may  be  briefly  noted.   Huge

chunks of land were acquired by the State of Haryana in different phases

for the public purpose of setting-up Industrial Model Township by the

Haryana State Industrial Development Corporation (HSIDC) in Gurgaon

District in Haryana. Substantial part of the acquired land was allotted by

the HSIDC to Maruti Suzuki India Limited (MSIL). One of the clauses in

the Conveyance Deed executed in favour of the allottee provided that if

compensation was enhanced, the allottee shall be liable to pay additional

price on that basis.  In HSIDC v. Pran Sukh1, issue of compensation for

land acquired in Phase I was decided by this Court.  Review Petitions

against the said judgment were dealt  with in  HSIDC v. Mawasi2 and

HSIDC v. Pran Sukh3.   Matter of determining compensation in respect

1

(2010) 11 SCC 175 2

(2012) 7 SCC 200 3

(2012) 7 SCC 721

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of Phase II and Phase III came-up for consideration in HSIDC v. Udal4.

As  noticed  in  judgment  of  this  Court  in  Udal  (supra),  the  Reference

Court awarded compensation in the light of compensation determined in

the  judgment  of  this  Court  in  Pran Sukh  (supra)  and  other  awards

relating  to  land  acquired  for  Phase  III.   Against  the  decision  of  the

Reference Court,  the land owners as well  as  the HSIDC filed appeals

under Section 54 of the Act.  The High Court assessed the compensation

based on judgment of this Court in  Pran Sukh  (supra).  Reference to

paras 29 to 33 of the judgment of this Court  Udal  (supra) shows that

after referring to the plea of the HSIDC that the annual increase of 12%

for  the  time  gap  was  erroneous  in  view  of  ONGC  v. Rameshbhai

Jivanbhai Patel5 and  Valliyammal  v. Special  Tehsildar (LA)6,  this

Court  found  merit  in  the  arguments  of  the  land  owners  that  an

important  piece  of  evidence  was  not  taken  into  account  which

necessitated remand.  The matter was remanded to the High Court for

fresh disposal and it  was also observed that MSIL was free to file an

4

(2013) 14 SCC 506 5

(2008) 14 SCC 745 6

(2011) 8 SCC 91

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appropriate  application  for  its  impleadment  or  for  leave  to  act  as

intervenor.   

4. Thereafter,  the matter  was  dealt  with  by the High Court  in  the

impugned judgment.  The High Court held that the allottee had a right to

be impleaded as a party for the following reasons:

a) The State or the local authority for whose benefit the land is

acquired  may  not  lead  proper  evidence  or  advance  effective

arguments.  

b)  A clause in the deed of allotment in favour of the allottee

provides  for  payment  of  additional  price  as  a  consequence  of

enhancement of compensation.

c)  As  a  result  of  enhancement  of  compensation  by  the

Reference  Court,  the  company  in  question  was  required  to  pay

about Rs.900 crores.

d) Under Order 1 Rule 10(2) CPC the Court can add or delete a

party at any stage.

e) Section 50 of the Act provides a right to a local authority or a

company for whose benefit the land is acquired to be represented

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before the Collector or the Court in the process of determination of

compensation.  

f) The principle behind giving the right of  representation to a

local authority or a company for whose benefit the land is acquired

can also be applied to any person who is liable to pay the enhanced

compensation treating such person to be the “person interested”

under Section 3(b) of the Act.

5. After permitting the allottee to be impleaded as a party, the High

Court also allowed application to lead additional evidence on the ground

that the acquiring authority did not defend the case properly.  Similar

application  filed  by  the  HSIDC  to  lead  additional  evidence  was  also

allowed and,  thereafter,  on considering the additional  evidence it  was

observed  that  it  was  not  possible  for  the  High  Court  to  assess  the

compensation  as  there  was  no  site  plan  showing  the  location  of  the

transactions  relied.   It  was  also  considered  necessary  to  give  an

opportunity to MSIL, who was impleaded for the first time.  On that basis

the matter was remanded to the Reference Court for fresh decision.  

6. Aggrieved by the order of the High Court these appeals have been

preferred.  Contentions of the appellants are as follows:  

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i) The post-acquisition allottee had no right to be heard in the

matter  of  compensation.   Reliance  has  been  placed  on  Hindu

Kanya  Maha  Vidyalaya,  Jind  and  anr.   v.  Municipal

Committee,  Jind  and  ors.7;  Haryana  State  Industrial

Development Corporation  v.  Pran Sukh and ors. (supra) and;

Peerappa Hanmantha Harijan (Dead) by legal representatives

and ors.  v.  State of Karnataka and anr.8  

ii) Applications for impleadment have been filed by MSIL 12 years

after the acquisition and applications for additional evidence were

also filed after a long delay and for the first time after remand by

this Court, which could not be considered within the scope of Order

XLI Rule 27 of CPC.   

(iii) Application for additional evidence was rejected by this Court in

the earlier round.  The remand by this Court was limited to the

question whether there was a need for further enhancement in the

light of evidence which was not earlier considered.

7. On the other hand, learned counsel for the MSIL as well as the

HSIDC and other allottees have supported the impugned judgment.  They

7

1988 (Supp) SCC 719 8

(2015) 10 SCC 469

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submit that since allottees have to pay the enhanced compensation, they

ought to be treated as “person interested” under Section 3 (b) of the Act.

Reliance  has  been placed  on judgments  of  this  Court  in  Himalayan

Tiles and Marble (P) Ltd.   v.   Francis  Victor Coutinho (Dead) by

Lrs.  9;  Santosh  Kumar  and  ors.   v.   Central  Warehousing

Corporation  and  anr.10;  Neyvely  Lignite  Corporation  Ltd.   v.

Special Tahsildar  (Land Acquisition)   Neyvely  and  Ors.11 and;

U.P. Awas Evam Vikas Parishad  v.  Gyan Devi (Dead) by Lrs. and

Ors.  12.

8. We have given our due consideration to the rival submissions.

9. To determine the question whether the post-acquisition allottee of

land is necessary or proper party or has any locus to be heard in the

matter of determination of compensation, we may refer to the scheme of

the Act.  The acquisition may either be for a “public purpose” as defined

under Section 3(f) or for a company under Part-VII of the Act.  If  the

acquisition is for a public purpose (as the present case), the land vests in

9

(1980) 3 SCC 223 10

(1986) 2 SCC 343 11

(1995) 1 SCC 221 12

(1995) 2 SCC 326

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the  State  after  the  Collector  makes  an  award  and  the  possession  is

taken.   Till the award is made, no person other than State comes into

the picture.  Once the land vests in the State, the acquisition is complete.

Any  transferee  from  the  State  is  not  concerned  with  the  process  of

acquisition.  The State may transfer the land by public auction or by

allotment at any price with which the person whose land is acquired has

no concern.  The mere fact that the Government chooses to determine

the allotment price with reference to compensation price determined by

the Court does not provide any locus to an allottee to contest the claim

for enhancement of compensation.   

10. This  legal  position  is  well  settled  on  principle  as  well  as  the

precedent.  In Hindu Kanya Maha Vidyalaya (supra)  it was observed:

“3. … … …Indisputably the land in dispute was not acquired for the purpose of appellants instead the land was acquired for the Municipal Committee for the purpose of developing its Scheme  No.  5.  After  the  declaration  of  award  Municipal Committee  took  possession  of  the  land  and  thereafter transferred a portion of the same to the appellants under an agreement. In these circumstances the ratio laid down by this Court in  Himalayan Tiles & Marble (P) Ltd. v.  Francis Victor Countinho  [(1980)  3  SCC  223] does  not  apply  as  the appellants are not interested persons and they have no right to question the award. … … …”  

11. Again,  in  Peerappa Hanmantha  (supra)  inter  alia the  following

questions were framed for consideration.

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“30.1.  (i)  Whether  the  allottee  Company  (M/s.  Ultra  Tech Cement  Ltd.)  is  either  a  beneficiary  or  interested  person entitled for hearing before determination of the market value to award just and reasonable compensation in respect of the acquired  land  of  the  appellants  either  before  the  Deputy Commissioner or Reference Court?

(ii)  Whether the writ petition filed by the allottee Company before the High Court is maintainable in law?

(iii) Whether the order of remand allowing the writ petition of the  allottee  Company  to  the  Reference  Court  is  legal  and valid?”

12. The above questions were answered as follows:

“63. In view of the foregoing reasons recorded by us on the basis  of  the  acquisition  notifications  issued  by  the  State Government under the statutory provisions of  the KIAD Act and therefore,  we have to  answer Points (i),  (ii)  and (iii)  in favour of the landowners holding that the Company is neither the  beneficiary  nor  interested  person of  the  acquired  land, hence, it has no right to participate in the award proceedings for  determination  of  the  market  value  and  award  the compensation amount of the acquired land of the appellants. Hence, the writ petition filed by the Company questioning the correctness  of  the  award  passed  by  the  Reference  Court which is affirmed by the High Court is not at all maintainable in  law.  On this  ground itself,  the  writ  petition  filed  by the Company  should  have  been  rejected  by  the  High  Court, instead  it  has  allowed  and  remanded  the  case  to  the Reference  Court  for  reconsideration  of  the  claims  after affording  opportunity  to  the  Company,  which  order  suffers from error in law and therefore, the same is liable to be set aside.”

13. Judgments  in  U.P.  Awas  Evam  Vikas  Parishad  (supra),

Himalayan Tiles (supra) and P. Narayanappa and anr.  v.  State of

Karnataka and ors.13 as  mentioned  in  para  61  of  the  judgment  in

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Peerappa Hanmantha  (supra)  were  held to  be not  applicable as the

same applied  only  when the  acquisition  is  for  a  company or  for  the

beneficiary  of  the  acquisition  as  mentioned  in  the  notification  for

acquisition itself.  This is clear from the following:

“61. Further,  both the learned Senior  Counsel  on behalf  of KIADB and  the  Company  have  placed  reliance  on  various decisions  rendered by  this  Court  in  support  of  their  above respective  legal  submissions  that  the  Company  is  an interested person and, therefore, it has got right to participate in  the  proceedings  before  the  Reference  Court  for determination  of  compensation  before  passing  the  award either  by  the  Land  Acquisition  Officer  or  the  Deputy Commissioner or the Reference Court at the instance of the owner  or  any  other  interested  person.  These  include judgments rendered by this Court in  U.P. Awas Evam Vikas Parishad v. Gyan Devi, Himalayan Tiles and Marble (P) Ltd. v. Francis  Victor  Coutinho and  P.  Narayanappa v.  State  of Karnataka and other decisions which are not required to be mentioned in this judgment as they are all reiteration of the law laid down in the above cases.

62. The reliance placed on the various decisions of this Court by both the learned Senior Counsel on behalf of KIADB and the Company,  is  misplaced as none of  the said judgments relied upon are applicable to the fact situation in the present case for the reason that those cases dealt with reference to the  acquisition of  land under  the  provisions  of  the  LA Act, either in favour of the company or development authorities, whereas  in  the  case  on  hand,  the  acquisition  proceedings have  been  initiated  under  the  KIAD  Act  for  industrial development  by  KIADB.  Further,  the  original  acquisition record  in  respect  of  the  acquired  land  involved  in  the proceedings by the learned Standing Counsel on behalf of the State  of  Karnataka  as  per  our  directions  issued  vide  our

(2006) 7 SCC 578

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orders dated 17-11-201414 and 24-3-201515, do not disclose the fact that the acquisition of lands covered in the acquisition notifications  are  in  favour  of  the  Company.  Thus,  the acquisition of  land in  favour  of  KIADB is  abundantly  clear from  the  preliminary  and  final  notifications  issued  by  the State  Government  and  thereafter  following  the  procedure under sub-sections (6) and (7) of Section 28 of the KIAD Act, it took possession of  the acquired land from the owners who were in possession of the same and was transferred in favour of KIADB for its disposal for the purpose for which lands were acquired as provided under Section 32(2) of the KIAD Act read with  the  Regulations  referred  to  supra  framed  by  KIADB under Section 41(2)(b) of the KIAD Act. Therefore, the reliance placed upon the judgments of this Court by the learned Senior Counsel  on behalf  of  the Company and KIADB, are wholly inapplicable to the fact situation and do not support the case of the Company.”

14

Peerappa Hanmantha Harijan  v.  State of Karnataka,  SLP(C)No. 19819 of 2013, order  dated 17-11-2014 (SC), wherein it was directed:     “Issue notice to the State Government.  The learned counsel for the petitioners to take out notice to the  learned  Standing  Counsel  appearing  for  the  State  Government.   Dasti,  in addition, is also permitted.  Mr. V.N. Raghupathy, learned counsel accepts notice for the State of Karnataka and Mr. Nishanth Patil, learned counsel accepts notice for Karnataka  Industrial  Area  Development  Board  (for  short  ‘KIADB’).   The  learned counsel appearing for the State Governument and the learned counsel appearing for KIADB are directed to produce the relevant records in respect of the proceedings relating to land acquisition involved in these matters.  There shall be stay of the effect and operation of the impugned order during the pendency of these petitions. List the matters after four weeks.  In the meanwhile, all  the respondents are at liberty to file written statements, if any.”

15

Peerappa Hanmantha Harijan  v.  State of Karnataka,  SLP(C)No. 19819 of 2013, order  dated 24-3-2015(SC), wherein it was directed:     “Heard Ms. Kiran Suri, learned Senior Counsel for the petitioners in SLPS(C)Nos. 31624-25 of 2014 in part.  List all the matters as part for further hearing.  Vide order dated 17-11-2014, learned counsel for the State as well as the learned counsel for KIADB were directed to  produce  the  relevant  records  in  respect  of  the  proceedings  relating  to  land acquisition  involved  in  these  matters,  record  as  well  as  the  records  relating  to allotment of land.  However, as per office records, nothing has been produced so far.  In this view of the matter, the learned counsel for the State as well as the learned counsel for KIADB are directed to comply with the order dated 17-11-2014 and produce the relevant records in respect of the proceedings relating to land acquisition and the allotment of land involved in these matters before the next date of hearing.  List the matters on 15-4-2015.”

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14. We are in respectful agreement with the above view in Hindu

Kanya Maha Vidyalaya (supra) and Peerappa Hanmantha (supra).

No contrary view of this Court has been brought to our notice.  The

judgments  relied  upon  by  the  respondents  are  distinguishable  as

already held by this Court.

 15. In  Himalayan  Tiles (supra)  the  acquisition  was  under

Part-VII  of  the  Act.   In  Santosh Kumar  (supra) the  question was

whether  award  of  the  Collector  could  be  challenged,  to  which this

Court  answered  in  the  negative  except  on  the  ground  of  fraud,

corruption  or  collusion.   In  Neyvely  Lignite  (supra)  again  the

acquisition was  under Part-VII  of  the  Act  and in that  context  this

Court  held  that  the  expression  “person  interested”  could  include  a

company or local authority for whose benefit the land was acquired.

The post-acquisition allottee cannot by any stretch of imagination be

treated at par with beneficiary for whom the land was acquired.  In

U.P. Awas Evam Vikas Parishad (supra), the matter dealt with was

in the context of statutory authority for whom the land was acquired.

Delhi Development Authority   v.   Bhola Nath Sharma (dead) by

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Lrs. and ors.16  was a case in the context of beneficiary for whom the

land was acquired.   

16. The only other justification in the impugned judgment which

has been relied upon by the respondents is lack of sincerity on the

part of the State authority for whose benefit the acquisition has been

made viz. HSIDC, which by itself cannot be a valid ground to permit

post-acquisition  allottee  to  be  treated  as  a  necessary  or   proper

authority  under  Order  I  Rule  10  of  CPC  to  proceedings  for

determination of  compensation.    The view taken in the impugned

judgment cannot be sustained on any principle or precedent.  

17. We  may  now  refer  to  an  order  of  this  Court  dated

15th July, 2004 which has been relied upon in the impugned judgment

in para 31.    There is no consideration of the principle of law and

thus, the said order without there being contest on the principle of law

could not be treated as a precedent for deciding the legal  issue at

hand.   

16

(2011) 2 SCC 54

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18. Accordingly, we hold that the post-acquisition allottee has no

locus to be heard in the matter and is neither a necessary nor a proper

party.   

19. The other part of the impugned order permitting additional

evidence and remanding the case for fresh decision is uncalled for.

No case was made out for permitting additional evidence on settled

principles  under  Order  XLI  Rule  27  of  CPC.    The  provision  is

reproduced below:-

“27. Production of additional evidence in Appellate Court.- (1) The parties to an appeal shall not be entitled to  produce  additional  evidence,  whether  oral  or documentary, in the Appellate Court.  But if –

(a)  the  court  from  whose  decree  the  appeal  is preferred has refused to admit evidence which ought to have been admitted, or

(aa)  the  party  seeking  to  produce  additional evidence, establishes that notwithstanding the exercise of  due  diligence,  such  evidence  was  not  within  his knowledge  or  could  not,  after  the  exercise  of  due diligence,  be  produced  by  him  at  the  time  when  the decree appealed against was passed, or

(b) the Appellate Court requires any document to be produced or any witness to be examined to enable it to  pronounce  judgment,  or  for  any  other  substantial cause,

The  Appellate  Court  may  allow  such  evidence  or document to be produced, or witness to be examined.

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(2)  Wherever  additional  evidence  is  allowed  to  be produced by an Appellate Court, the Court shall record the reason for its admission.”

20. It is clear that neither the Trial Court has refused to receive the

evidence nor it could be said that the evidence sought to be adduced was

not available despite the exercise of due diligence nor it could be held to

necessary to pronounce the judgment.   Additional  evidence cannot be

permitted to fill-in the lacunae or to patch-up the weak points in the

case17.  There was no ground for remand in these circumstances.   

21. We  may  also  refer  to  the  argument  that  this  Court,  while

remanding the matter in the earlier round, had given liberty to the MSIL

to file an application for impleadment or to act as an intervenor which

implied that such application was to be accepted.  We do not find any

merit  in  this  contention also.    It  cannot be held that  any right  was

crystalised by the said observation and such prayer had to be considered

according to law.  We have already held that the post-acquisition allottee

had no right in the matter.  

17

N. Kamalam  v.  Ayyaswami (2001) 7 SCC 503: para 19

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22. For the above reasons, we allow these appeals and set aside the

impugned order and remand the matter to the High Court once again for

fresh decision in accordance with law.  The parties are directed to appear

before the High Court on 27th March, 2017.

…………..…………………………….J.     [ ADARSH KUMAR GOEL ]

.….……………………..……………..J.             [ UDAY UMESH LALIT ]

NEW DELHI; FEBRUARY 21, 2017.

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