REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 353 OF 2017 (ARISING OUT OF SLP (C) NO. 12581 OF 2015)

THE SPECIAL LAND ACQUISITION  OFFICER, KIADB, MYSORE & ANR.

.....APPELLANT(S)

VERSUS

ANASUYA BAI (D) BY LRs. & ORS. .....RESPONDENT(S)

J U D G M E N T

A.K. SIKRI, J.

The  question  of  law  that  has  been  raised  in  this  appeal  by  the

appellants, for consideration by this Court, is:   

Whether provisions of  the Right to Fair Compensation and

Transparency  in  Land  Acquisition  Rehabilitation  and

Resettlement  Act,  2013  (for  short,  “New  LA  Act”),  are

applicable in the instant case when the land is acquired under

the provisions of KIAD Act?

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2) Factual narration that is required to be noted, giving rise to the aforesaid

question of law, is stated hereinbelow:

Respondents is the owner of land bearing Sy. No. 123/1 measuring 4

acres  9  guntas  and  Sy.  No.  123/2  measuring  1  acre  situated  at

Anganahalli  Village,  Belagola  Hobli,  Srirangapatna  Taluk,  Madhya

District, Karnataka.  

3) The appellants issued a preliminary notification under Section 28(1) of

the  Karnataka  Industrial  Areas  Development  Act,  1966  (hereinafter

referred to as “KIAD Act”) as it wanted to acquire certain lands, including

that of the respondents for the purpose of developing the said lands as

an Industrial Area and the same was published in the Karnataka Gazette

on 15th September, 2000.

4) After  issuing  the  necessary  notices  and  following  the  procedure

prescribed under the KIAD Act, a final notification under Section 28(4)

was issued on 15th June, 2005 in respect of total 153 acres 10 guntas of

land.

5) Section 29 of  the KIAD Act  deals with compensation.   Section 29(2)

provides  that  where  the  compensation  has  been  determined  by

agreement  between  the  State  Government  and  the  person  to  be

compensated, it shall be paid in accordance with such an agreement.  In

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case, where no agreement is arrived at, the State Government is to refer

the case to the Deputy Commissioner for determination of the amount of

compensation to be paid. This scheme of acquisition of land is contained

in Sections 29 and 30 which are reproduced below:

“28.   Acquisition  of  land.-  (1)  If  at  any  time,  in  the opinion of the State Government, any land is required for the purpose of development by the Board, or for any other purpose in furtherance of the objects of this Act, the State Government may by notification, give notice of its intention to acquire such land.  

(2)  On publication of a notification under sub-section (1), the State Government shall serve notice upon the owner or where the owner is not the occupier, on the occupier of the land and on all such persons known or believed to be interested therein to show cause, within thirty days from the date of service of the notice, why the land should not be acquired.  

(3)  After considering the cause, if  any, shown by the owner of the land and by any other person interested therein,  and  after  giving  such  owner  and  person  an opportunity of being heard, the State Government may pass such orders as it deems fit.  

(4)   After  orders  are  passed  under  sub-section  (3), where the State Government is satisfied that any land should  be  acquired  for  the  purpose  specified  in  the notification issued under sub-section (1), a declaration shall, by notification in the official Gazette, be made to that effect.  

(5)   On  the  publication  in  the  official  Gazette  of  the declaration  under  sub-section  (4),  the  land shall  vest absolutely  in  the  State  Government  free  from  all encumbrances.  

(6)  Where any land is vested in the State Government under sub-section (5),  the State Government may, by notice  in  writing,  order  any  person  who  may  be  in possession  of  the  land  to  surrender  or  deliver

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possession  thereof  to  the  State  Government  or  any person duly authorised by it in this behalf within thirty days of the service of the notice.  

(7)   If  any person refuses  or  fails  to  comply with  an order  made  under  sub-section  (5),  the  State Government  or  any  officer  authorised  by  the  State Government in this behalf may take possession of the land and may for that purpose use such force as may be necessary.  

(8) Where the land has been acquired for the Board, the State Government, after it has taken possession of the land, may transfer the land to the Board for the purpose for which the land has been acquired.  

29.  Compensation.- (1) Where any land is acquired by the  State  Government  under  this  Chapter,  the  State Government  shall  pay  for  such  acquisition compensation in accordance with the provisions of this Act.  

(2)   Where  the  amount  of  compensation  has  been determined  by  agreement  between  the  State Government and the person to be compensated, it shall be paid in accordance with such agreement.  

(3)   Where  no  such agreement  can  be  reached,  the State Government  shall  refer  the case to  the Deputy Commissioner  for  determination  of  the  amount  of compensation to be paid for such acquisition as also the person or persons to whom such compensation shall be paid.

(4)  On receipt of a reference under sub-section (3), the Deputy Commissioner shall serve notice on the owner or occupier of such land and on all persons known or believed to be interested herein to appear before him and state their respective interests in the said land. ”

6) Section 30 of the KIAD Act deals with application of Land Acquisition

Act,  1894  (hereinafter  referred  to  as  the  'Old  LA Act')  and  same  is

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reproduced below:

“Section 30.  application of Central  Act 1 of 1894.—The provisions of the Land Acquisition Act, 1894 (Central Act 1 of  1894)  shall  mutatis  mutandis apply  in  respect  of  the enquiry  and  award  by  the  Deputy  Commissioner,  the reference to court, the apportionment of compensation and the payment of compensation, in respect of lands acquired under this Chapter.”

7) In view of the statutory obligations to pay compensation in accordance

with the provisions of the KIAD Act, the Deputy Commissioner, Madhya

came to be constituted as an authority to  assess and fix  the market

value prevailing as on the date of notification under Section 28(1) of the

KIAD Act in consultation with land owners.   The Advisory Committee

consisting of eight persons was constituted.

8) The appellants issued notice to all land owners for participating in the

meeting of the Price Advisory Committee to fix the compensation with

consent.  The Advisory Committee headed by the Deputy Commissioner

held its meetings with the land owners. The proceedings of the Advisory

Committee under the Chairmanship of Deputy Commissioner was held

on 9th September, 2005.   

9) According to the appellants herein, the outcome of the meeting with the

land  owners  was  that  the  Advisory  Committee  could  achieve  a

consensus and the market rate with consent was fixed at Rs. 6,50,000/-

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per  acre.   It  is  also the  case  of  the  appellants  that  majority  of  land

owners have accepted the said compensation.  However, respondents

have taken the position that they are not the parties to this agreement.

This aspect shall be adverted to at a later stage with some more details.

At this stage, it is suffice to mention that it has come on record that the

respondents had sent letter dated 30th October, 2006 to the appellants in

reply  to  letter  dated  16th August,  2006  of  the  appellants,  thereby

requesting  the  appellants  to  provide  reasonable  and  adequate

compensation.  However, before compensation could be disbursed to

the respondents at the rates purportedly fixed, some disputes among

family members of the respondents arose about the proportionment of

the compensation amongst them.  The children of respondent, namely,

Parmesh, Lakshamma and Sunil  appeared through their  counsel  and

opposed payment of compensation to the respondents.  In view of this

dispute, the appellants deposited the entire compensation payable to the

respondents, before the Civil Court, Srirangapatna, as per the provisions

of Section 30 of the Old LA Act.  Precisely a sum of Rs. 30,15,871/- was

deposited before the Civil Court vide cheque dated 8 th March, 2007.  On

that basis LAC No. 13 of 2007 was registered and the court sent notice

dated 13th June, 2008 to the respondents.  At this stage, the writ petition

was filed by the respondents in the High Court of Karnataka praying for

quashing of preliminary notification dated 15th September, 2000 and final

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notification dated 15th June, 2005, inter alia, on the following grounds:

(a) That provisions of Section 11, 11A of the Old LA Act are made applicable

to the proceedings under KAID Act by virtue of Section 30 of the KAID

Act  and  the  Deputy  Commissioner  has  not  passed  any  award  as

required under Section 11 of the Old LA Act;

(b) The entire proceedings initiated under Section 28 of the KAID Act have

lapsed as no award has been passed within two years from the date of

publication of final declaration.

(c) In the absence of consent award under Section 29(2) of the KIAD Act,

the Deputy Commissioner is duty bound to pass regular award under

Section  11A  of  the  Old  LA  Act  within  two  years  from  the  date  of

publication of final notification.

(d) That the respondent herein had not given any consent for the so-called

consent  award  as  she  had  not  appeared  before  the  Deputy

Commissioner and did not participate in the said proceeding.

10) The  appellants  contested  the  said  writ  petition  by  filing  their

statement of objection. As per the appellants, all  the statutory notices

had been sent at the correct address of the respondent and necessary

procedure for fixation of compensation had been followed by them.  It

was also submitted that provisions of Section 11A of the Old LA Act were

not  applicable  to  the  acquisition  proceedings  under  KIAD  Act.   The

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Single  Judge  of  the  High  Court  vide  judgment  and  order  dated  9th

November,  2012  allowed  writ  petition  in  part  holding  that  the

respondents were not the parties to the Consent Award.  However, the

Single Judge permitted the appellants to proceed with the fixing of the

market value as on the date of final notification dated 15 th June, 2005

after  repelling  the  plea  of  the  respondents  that  the  acquisition

proceedings had lapsed.  Aggrieved by this judgment, the respondents

preferred  writ  appeal  before  the  Division  Bench  of  the  High  Court

wherein following stance was taken by them:

(a) That mandatory notice required under Section 28(2) of the KIAD Act was

not served upon the appellants.

(b) That Section 30 of the KIAD Act applies the provision of Old LA Act in

respect  of  enquiry  and  award  by  the  Deputy  Commissioner  and,

therefore, Section 11A is applicable and in this case, the award is not

passed under Section 11A within two years,  therefore, the acquisition

has lapsed.

c) That proceeding of the Advisory Committee conducted on 9th September,

2005 is only a consultation with some of the land owners and cannot be

said to be a consent award, which is required to be passed in writing

under Rule 10(b) of the Land Acquisition Rules, 1965 in form No. D.

11) During the pendency of the matter, the New LA Act came into force

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on  1st January,  2014  whereby  Old  LA  Act  stood  repealed.   The

respondents filed application under Order VI Rule 17 of the Code of Civil

Procedure, 1908 alleging that since the New LA Act had come into force,

as per Section 24 of the said Act,  acquisition of the land had lapsed

since no award has been passed under Section 11 of the Old LA Act.

12) The  Division  Bench  of  the  High  Court  of  Karanataka  by  its

judgment and order dated 14th January, 2015, allowed the writ appeal

and  quashed  the  proceeding  initiated  by  the  appellants  by  way  of

preliminary and final notification on the following grounds:

(a) When the award was required to be passed under the Old LA Act,  it

cannot be said that  provisions of the New LA Act would not  apply to

acquisition under KIAD Act and, therefore, Section 24 of the New LA Act

will apply.

(b) Even though this Court has held that Section 11A of the Old LA Act has

no application in respect of the land acquired under the provisions of

KIAD  Act,  the  New  LA  Act  is  applicable  and  that  the  acquisition

proceedings  would  be  deemed  to  have  lapsed  due  to  non-payment,

compensation  and  non-passing  of  the  award  within  a  period  of  two

years.

(c) That the New LA Act does not say whether it is applicable to the lands

acquired  under  the  provisions  of  Karnataka  Land  Acquisition  Act  but

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what Section 24 says is that once the award is not passed under Section

11A of Old LA Act or the compensation is not paid within five years, such

proceeding would be lapse.   

13) It could be gathered from the above that the Division Bench has

held that the New LA Act would be applicable to the present proceedings

though they were initiated under the provisions of the KIAD Act read with

the Old LA Act.  It has further held that since there was no consent on

fixation of the compensation given by the respondents, the case would

be governed by Section 24(1) of the New LA Act.  However, since there

is no provision for passing the award under the KIAD Act, which had to

be passed only under the Old LA Act, and since no award had been

passed  after  the  final  declaration  on  15th June,  2005,  acquisition

proceedings are deemed to have been lapsed.

14) Learned counsel for the appellants submitted that after issuance of

the preliminary notification, requisite notices were issued and procedure

prescribed under the KIAD Act was followed, which culminated in fixing

the compensation at  Rs.6,58,000/-  per  acre with consent  of  the land

owners.  Not only this, thereafter, even the compensation pertaining to

the land of the respondents was deposited by the appellants before the

City Civil Court, Srirangapatna.  She stated that this compensation could

not be disbursed or withdrawn by the respondents in view of the dispute

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that had arisen between the claimants about the apportionment of the

said amount and for this reason, reference was made under Section 30

of the Old LA Act.  The Civil Court had even issued notice to the parties

for  adjudication  of  the  dispute.   She,  thus,  submitted  that  once  the

Advisory Committee had taken a decision and fixed the compensation

with the consent of the parties, no award under the provisions of the LA

Act was required in the instant case.  Proceeding further in this line of

argument,  she  contended  that  in  such  circumstances,  provisions  of

Section 24(2) of the New LA Act were not applicable and, if at all, it is

sub-section (1) of Section 24 which would be applicable in the given

circumstances.  Referring to sub-section (1) of Section 24, she argued

that the situation would be akin to what has been contemplated under

clause  (b)  thereof  and,  therefore,  there  was  no  question  of  deemed

lapse  of  acquisition  proceedings  which  situation  is  provided  under

sub-section (2) of Section 24 and is not attracted in the instant case.   

15) Learned  counsel  for  the  respondents  countered  the  aforesaid

submission by emphasising that the Single Bench as well as the Division

Bench  of  the  High  Court  rightly  arrived  at  a  finding  of  fact  that  the

respondents had not given any consent for fixation of compensation at

Rs.6,50,000/-  and,  therefore,  the decision of  the Advisory Committee

dated  9th  September,  2005  in  this  behalf  was  not  binding  on  the

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respondents.   On  this  basis,  it  was  submitted  that  as  the  exercise

contemplated under Section 29 of the KIAD Act was not fructified, it was

like  'No  Consent  Award'  passed  by  the  Advisory  Committee  and

provisions of sub-section (2) of Section 24 of New LA Act shall squarely

apply.

16) From  the  narration  of  events  described  above  as  well  as  the

arguments of  both the sides,  it  becomes clear  that  the first  question

which needs determination is as to whether fixation of compensation at

the rate of Rs.6,50,000/- per acre by the Advisory Committee is with the

consent of the respondents or not.  

17) Before adverting to the aforesaid aspect,  we may clarify certain

legal aspects.  In the State of Karnataka, land can be acquired under the

KIAD Act as well, for the purpose of developing the acquired land as an

industrial area.  Section 28(1) of the KIAD Act provides for issuance of

preliminary notification for the aforesaid purpose. Other sub-sections of

Section 28 provide for a particular procedure to be followed by issuing

necessary  notices  and  once  that  is  undertaken,  final  notification  for

acquisition of the land can be issued under sub-section (4) of Section 28

of the KIAD Act.  Section 29 of the KIAD Act deals with the payment of

compensation.  The provision which is made under this Section calls for

determination  of  compensation  by  agreement  between  the  State

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Government  on  the  one  hand  and  the  land  owner,  who  is  to  be

compensated for the land acquired, on the other hand.  In case, no such

agreement is arrived at, the State Government is supposed to refer the

case to the Deputy Commissioner for determination of the amount of

compensation, who is required to determine the compensation as per

Section 30 of the KIAD Act.  Section 30 of the KIAD Act provides that for

fixing the compensation, the Deputy Commissioner is supposed to follow

the same procedure as prescribed under the Old LA Act.  Obviously, in

that event, after following the procedure in the Old LA Act, the Deputy

Commissioner  is  required  to  pass  an  award  (which  is  contemplated

under Section 9 of the Old LA Act).  What follows from the above is that

the  first  attempt  is  to  arrive  at  a  consensus  between  the  State

Government and the person who is the land  loser.  This task is to be

undertaken  by  the  Advisory  Committee.   If  it  is  accomplished  then

compensation  is  payable  as  per  the  said  agreement.   If  such  an

agreement does not fructify, the Deputy Commissioner is to determine

the compensation after following the procedure contained in the Old LA

Act and pass necessary award in this behalf.  Obviously, when there is

an agreement no such award is required.  Conversely, when there is no

agreement on compensation between the parties, passing of the award

under  Section  30  of  the  KIAD Act  becomes  imperative  to  bring  the

acquisition  proceedings to  a  logical  conclusion.   In  the  instant  case,

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admittedly  there  is  no  award  passed  by  the  Deputy  Commissioner.

According to the appellants, it is because of the reason that, by consent,

market rate of the land in question was fixed at Rs.6,58,000/- by the

Advisory  Committee  under  the  Chairmanship  of  the  Deputy

Commissioner  on  9th  September,  2005.   Respondents  contend

otherwise  submitting that  there  is  no such consent  and  their  plea is

accepted by the Courts below.  It  becomes necessary to answer this

question.   

18) The undisputed facts which emerge on record, are the following:

On 15th September, 2000, a preliminary notification under Section

28(1) of the KIAD Act was published.  It was followed by final notification

dated 15th June, 2005 under Section 28(4) of the KIAD Act.  With the

issuance of notification under Section 28(4) of the KIAD Act, the land

stood  vested  absolutely  in  the  State  Government,  free  from  all

encumbrances (See Section 28(5) of the KIAD Act).  Next step was to

take  the  possession  of  the  land  as  per  the  procedure  stated  in

sub-sections (6) and (7) of Section 28 of the KIAD Act and to pay the

compensation as provided under Section 29 of the KIAD Act.  The State

Government  had  constituted  the  Advisory  Committee  consisting  of  8

persons which  deliberated with  the land owners  in  order  to  arrive at

consensual figure of the compensation.  Notice dated 23rd August, 2005

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was issued in this behalf fixing the date of meeting as 9th September,

2005  with  request  to  the  land  owners  to  attend  the  said  meeting.

Appellants have placed on record proceedings of the said meeting held

on 9th September, 2005 as per which consent agreement was arrived at

whereby compensation was fixed at Rs.6,50,000/- per acre.  It appears

that thereafter letter dated 16th August, 2006 was sent by the Office of

the  Special  Land Acquisition  Officer,  KIADB,  Mysore  though it  is  not

placed on record.  However, respondent Anasuya Bai responded to that

letter vide her communication dated 30th October, 2006 stating that she

was ready to take reasonable and adequate compensation as per the

rate prevailing in the market.    Thereafter, she wrote letter dated 7th

February, 2008 requesting the appellants to furnish copies of preliminary

notification  dated  13th  May,  2005  and  final  notification  issued  under

Section 28(4) dated 15th June, 2005.  Another letter dated 26th May,

2008 was written vide which she asked for the certified copies of the

following documents:

(i) Agreement, if any, reached between her and the Government as

per the provisions of Section 29(2) of KIAD Act.

(ii) Agreement, if any, entered into between her and KIAD Board as

per the provisions of Section 11(2) of KIAD Act.

(iii) Award, if any, passed as per Section 11(2) of Old LA Act based on

principles of valuation of acquired land by adopting known method of

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valuation.

19) Aforesaid  facts  are  not  in  dispute.   However,  it  appears  that

thereafter  some  litigation  started  in  connection  with  the  title  of  the

property in question resulting into dispute as to who was to receive the

compensation and how it had to be apportioned. Respondent Anasuya

Bai had filed some petition in this behalf before the Principle Civil Judge

(Sr. Division) and JMFC. Summons dated 13th June, 2008 were issued

by the said Principal Civil Judge to the appellants to appear on 3rd May,

2008.   Having  regard  to  this  dispute,  the  appellants  deposited  the

compensation in the Civil Court at the rate of Rs.6,50,000/- per acre as

per the decision of the Advisory Committee.  When the matter rested at

that stage, the respondents filed writ petition in the High Court seeking

quashing of preliminary notification as well as final declaration.  Prayer

was also made to the effect that acquisition of their land under Section

28(1) of the KIAD Act be declared as lapsed.  The aforesaid prayers

were  made  on  the  ground  that  no  award  was  passed  by  the  Land

Acquisition Collector within the time stipulated under Section 11A of the

Old LA Act.  

20) Appellants herein filed the statement of objections to the said writ

petition  contending  that  by  agreement  the  compensation  of

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Rs.6,50,000/- per acre was fixed and, therefore, there was no need to

pass  the  award.   It  was  also  stated  that  insofar  as  appellants  are

concerned, it  had deposited the amount  of  compensation in  the Civil

Court in view of the dispute between the respondents inter se.   

21) From  the  issuance  of  notice  alone  to  the  respondents  under

Section 29 of KIAD Act, it cannot be said that respondents had agreed to

the  compensation.   It  may  be  noted  that  large  chunk  of  land  was

acquired  and  there  were  other  land  owners  as  well,  despite  the

respondents.   No  doubt,  proceedings  dated  9th  September,  2005

indicate that consent agreement is arrived at fixing the compensation at

Rs.6,50,000/- per acre.  However, the moot question is as to whether

respondents are also consenting parties.  The learned Single Judge of

the High Court  returned a categorical  finding that  respondents  never

gave any such consent.  For this purpose, reference was made to Rule

10(b) of the Karnataka Land Acquisition Rules, 1965 which states the

format in which the said mutual agreement is to be arrived at i.e. Form

D.   Rule  10(b)  states  the  form of  agreement  to  be  executed  under

sub-section (2) of Section 11 shall be in Form D.  No such document is

produced by the appellants.  Moreover, the appellants also could not

show that notice dated 23rd August, 2005 was, in fact, served on the

respondents.   Therefore,  the  respondents  had  not  consented  to  the

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amount of compensation that was determined in the minutes dated 9th

September, 2005.  This finding is upheld by the Division Bench in the

impugned judgment as well.  There is no reason to disagree with this

finding.     

22) Having said so, it also needs to be kept in mind that a large chunk

of land was acquired by the appellants and a minuscule part  thereof

belonged to the respondents herein.  Further, insofar as respondents are

concerned, it even undertook the exercise of fixing the compensation for

the  acquired  land,  as  per  the  provisions  of  the  KIAD Act.   Advisory

Committee was constituted for this purpose.  Notices were also sent to

all  concerned,  including the respondents herein.   It  further transpired

that  the  land  owners  (except  the  respondents)  participated  in  the

meeting and as per the minutes of the meeting dated 9th September,

2005, consent agreement was arrived at whereby compensation at the

rate  of  Rs.6,50,000/-  per  acre  was  fixed.   With  these  minutes,  the

Advisory  Committee  remained  under  the  impression  that  it  had

accomplished  its  task  by  reaching  a  consensus  on  the  quantum  of

compensation.   Not  only  this,  further  steps  were  taken  to  pay  the

compensation at the aforesaid rate to the land owners, whose land was

acquired.  Insofar as respondents are concerned, due to the disputes

inter se between them, the compensation as per the minutes dated 9th

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September, 2005 was even deposited with the Civil  Court.   The Civil

Court issued notice and the respondents participated in the proceedings

before the Civil Court.  At that stage, respondents chose to file a writ

petition for quashing of the acquisition proceedings coming out with the

plea that they were not consenting parties and had not participated in

the meeting dated 9th  September, 2005 as even the notice  was not

received by them.  Aforesaid facts disclose that the entire move on the

part of the appellants was bonafide one, though there was an accidental

slip on their part that insofar as respondents are concerned, no consent

to the amount of compensation fixed was given by them.  It appears that

the  appellants-authorities  did  not  proceed  further  to  determine  the

compensation  in  respect  of  respondents'  land  as  they  nurtured  a

bonafide belief that with the fixation of compensation as per the Minutes

dated  9th  September,  2005  all  the  land  owners,  including  the

respondents,  had  agreed  with  the  same  and,  therefore,  no  further

exercise  was  required.   Had  the  appellants-authorities  been  more

careful, they would have noticed that insofar as respondents herein are

concerned, they are not the consenting parties.  In that event, they could

have brought  them on  board  with  other  land  owners  by taking  their

specific consent as well or proceeded further under Section 29(3) of the

KIAD Act.   

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23) Taking these factors into consideration, the learned Single Judge

vide his judgment dated 9th November, 2012 permitted the appellants to

proceed on the basis of the Gazette notification dated 15th June, 2005

acquiring the land and determine the compensation by making an award

in  this  behalf.   By this  process,  appellants  were  allowed  to  proceed

afresh to determine the compensation under Section 29(2) of the KIAD

Act by reaching an agreement with the respondents, and failing which to

refer  the  case  to  the  Deputy  Commissioner  under  Section  29(2)  for

determination  of  the  amount  of  compensation.   The  learned  Single

Judge,  by  adopting  this  course  of  action,  specifically  rejected  the

contention of the respondents herein to quash the proceedings.

24) The Division Bench of the High Court by the impugned judgment,

however, has  quashed the  acquisition  proceedings  itself  holding  that

they have lapsed.  For this purpose, the High Court has taken aid of

Section 24 of the New LA Act in the following manner:

“13.   It  is  also noted that  the acquisition proceedings including  preliminary  and  final  declaration  have  been passed  under  the  provisions  of  the  KIADB  Act.   But there is no provisions under the KIADB Act to pass an award  and  award  has  to  be  passed  only  under  the provisions of the LA Act, 1894.  If the award has to be passed  under  LA  Act,  whether  the  new  act  can  be pressed into service to hold the acquisition proceedings are lapsed on account of non-passing of award within a period of 5 years U/s 11.  If the award is passed under LA Act, the enquiry has to be conducted by the Deputy Commissioner  or  Collector  before  passing  the  award.

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Section  11A contemplates  if  the  award  is  not  passed within 2 years from the date of publication of the final declaration, the entire proceedings for acquisition of the land shall  automatically stands lapsed.  It  is no doubt true  the  Hon'ble  Supreme  Court  in  the  case  of  M. Nagabhushana  Vs.  State  of  Karnataka  and  Others, (2011) 3 SCC 408 has held that Section 11-A of the Act is no applicatin in respect of the land acquired under the provisions  of  the  Karnataka  Industrial  Areas Development Act.  We have to consider in this appeal as to whether Section 24(2) of the New Act is applicable in order to hold that the acquisition proceedings deemed to be  lapsed  due  to  non-payment  of  compensation  and non-passing of the award within a period of five years from  the  date  of  declaration  and  with  effect  from non-payment of compensation to the land owners.

14.   The  New  Act  does  not  say  whether  the  Act  is applicable to the land acquired under the provisions of the Karnataka Land Acquisition Act 1894.  What Section 24 says that if the award is not passed U/s 11 of the Act and the compensation is not paid within 5 years or more prior to new act, if the physical possession of the land is taken or not especially the compensation is not paid or deposited  in  Court  such  proceedings  deem  to  have been lapsed.  In th instant case, it  is  not case of  the respondent  that  award  is  not  required  to  be  passed under  the  provisions  of  LA Act.   When  the  award  is required to be passed under LA Act,  the respondents cannot contend that the provisions of New Act cannot be made  applicable  on  account  of  non  payment  of compensation within a period of five years.”

25) This approach of the High Court, we find, to be totally erroneous.

In the first instance, matter is not properly appreciated by ignoring the

important  aspects  mentioned  in  para  24  above.   Secondly,  effect  of

non-applicability  of  Section  11A  of  the  Old  LA  Act  is  not  rightly

understood.  The High Court was not oblivious of the judgment of this

Court  in  M.  Nagabhushana's  case  which  is  referred  by  it  in  the

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aforesaid discussion itself.  This judgment categorically holds that once

the proceedings are initiated under the KIAD Act, Section 11A of the Old

LA Act would not be applicable.  Such an opinion of the Court is based

on the following rationale:

“29. The appellant has not challenged the validity of the aforesaid provisions. Therefore, on a combined reading of  the  provisions  of  Sections  28(4)  and  28(5)  of  the KIAD  Act,  it  is  clear  that  on  the  publication  of  the Notification  under  Section  28(4)  of  the  KIAD  Act  i.e. from 30-3-2004, the land in question vested in the State free  from  all  encumbrances  by  operation  of  Section 28(5) of the KIAD Act, whereas the land acquired under the said Act vests only under Section 16 thereof, which runs as under:

“16.Power  to  take  possession.—When  the Collector has made an award under Section 11, he may take possession of the land, which shall thereupon  vest  absolutely  in  the  Government, free from all encumbrances.”

30.  On a  comparison of  the  aforesaid  provisions, namely, Sections 28(4)  and 28(5)  of  the  KIAD Act with Section 16 of the said Act, it is clear that the land  which  is  subject  to  acquisition  proceeding under the said Act gets vested with the Government only  when  the  Collector  makes  an  award  under Section 11, and the Government takes possession. Under  Sections  28(4)  and  28(5)  of  the  KIAD  Act, such vesting takes place by operation of law and it has nothing to do with the making of  any award. This is where Sections 28(4) and 28(5) of the KIAD Act are vitally different from Sections 4 and 6 of the said Act.

31.  A  somewhat  similar  question  came  up  for consideration before a three-Judge Bench of this Court in Pratap v. State of Rajasthan [(1996) 3 SCC 1] . In that case  the  acquisition  proceedings  commenced  under Section 52(2) of the Rajasthan Urban Improvement Act, 1959 and the same contentions were raised,  namely, that the acquisition notification gets invalidated for not

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making an award within a period of two years from the date of  notification.  Repelling the said contention,  the learned Judges held that once the land is vested in the Government,  the  provisions  of  Section  11-A  are  not attracted and the acquisition proceedings will not lapse. (Pratap case[(1996) 3 SCC 1] , SCC para 12 at p. 8 of the Report.)

32. In  Munithimmaiah  v.  State of Karnataka  [(2002) 4 SCC 326] this Court held that the provisions of Sections 6 and 11-A of the said Act do not apply to the provisions of the Bangalore Development Authority Act, 1976 (the BDA Act). In SCC para 15 at p. 335 of the Report this Court made a distinction between the purposes of the two enactments and held that all the provisions of the said Act do not apply to the BDA Act. Subsequently, the Constitution Bench of this Court in  Offshore Holdings (P) Ltd.  v. Bangalore Development Authority  [(2011) 3 SCC 139 : (2011) 1 SCC (Civ) 662 : (2011) 1 Scale 533] , held that Section 11-A of the said Act does not apply to acquisition under the BDA Act.

33. The same principle is attracted to the present case also. Here also on a comparison between the provisions of the said Act and the KIAD Act, we find that those two Acts  were  enacted  to  achieve  substantially  different purposes. Insofar as the KIAD Act is concerned, from its Statement of Objects and Reasons, it is clear that the same was enacted to achieve the following purposes:

“It  is considered necessary to make provision for the orderly establishment and development of industries in suitable areas in the State. To achieve  this  object,  it  is  proposed  to  specify suitable  areas  for  industrial  development  and establish a board to  develop such areas and make available lands therein for establishment of industries.”

34.  The KIAD Act is of  course a self-contained code. The said Act is primarily a law regulating acquisition of land  for  public  purpose  and  for  payment  of compensation. Acquisition of land under the said Act is not  concerned  solely  with  the  purpose  of  planned development  of  any  city.  It  has  to  cater  to  different situations which come within the expanded horizon of public purpose. Recently the Constitution Bench of this Court  in  Girnar  Traders  (3)  v.  State  of  Maharashtra

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[(2011) 3 SCC 1 : (2011) 1 SCC (Civ) 578 : (2011) 1 Scale 223] held that Section 11-A of the said Act does not  apply  to  acquisition  under  the  provisions  of  the Maharashtra Regional and Town Planning Act, 1966.

35. The learned counsel for the appellant has relied on the  judgment  of  this  Court  in  Mariyappa  v.  State  of Karnataka [(1998) 3 SCC 276] . The said decision was cited for the purpose of contending that Section 11-A is applicable  to  an  acquisition  under  the  KIAD  Act.  In Mariyappa  [(1998) 3 SCC 276] before coming to hold that provision of Section 11-A of the Central Act applies to the Karnataka Acquisition of Land for Grant of House Sites Act, 1972 (hereinafter “the 1972 Act”), this Court held that the 1972 Act is not a self-contained code. The Court also held that the 1972 Act and the Central Act are supplemental to each other to the extent that unless the  Central  Act  supplements  the  Karnataka  Act,  the latter cannot function. The Court further held that both the Acts, namely, the 1972 Act and the Central Act deal with the same subject. But in the instant case the KIAD Act is a self-contained code and the Central Act is not supplemental  to  it.  Therefore,  the  ratio  in  Mariyappa [(1998) 3 SCC 276] is not attracted to the facts of the present case.

36.  Following the aforesaid well-settled principles, this  Court  is  of  the  opinion  that  there  is  no substance  in  the  contention  of  the  appellant  that acquisition under the KIAD Act lapsed for alleged non-compliance with the provisions of Section 11-A of  the said  Act.  For  the  reasons aforesaid all  the contentions  of  the  appellant,  being  without  any substance, fail and the appeal is dismissed.”

26) Having regard to the aforesaid raison d'etre for non-application of

the Old LA Act, on the parity of reasoning, provision of Section 24(2) of

the New LA Act making Section 11A of the Old LA Act would, obviously,

be not applicable.  We would like to refer to the judgment in the case of

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State  of  M.P.  v.  M.V.  Narasimhan1 in  this  behalf  where  following

proposition is laid down:

“Where a subsequent Act incorporates provisions of a previous Act, then the borrowed provisions become an integral and independent part of the subsequent Act and are totally unaffected by any repeal  or amendment  in the previous Act.  This principle, however, will not apply in the following cases:

(a)  where the subsequent Act and the previous Act are supplemental to each other;

(b)  where the two Acts are in pari materia;

(c)   where the amendment  in  the previous Act,  if  not imported into the subsequent Act also, would render the subsequent Act wholly unworkable and ineffectual; and

(d)where the amendment of  the previous Act, either expressly or by necessary intendment, applies the said provisions to the subsequent Act.”

27) We are, therefore, of the opinion that the view taken by the learned

Single Judge was correct in law which should not have been interfered

with by the Division Bench in the impugned judgment. It is significant to

state that insofar as direction of the Single Judge is concerned that was

accepted by the appellants herein, as the appellants did not challenge

the same.  It is the respondents which had filed the intra court appeal.

Thus, appellants by their aforesaid conduct, are satisfied with the order

of  the  learned  Single  Judge  in  directing  them  to  determine  the

compensation.

1 (1975) 2 SCC 377

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28) We, thus, allow this appeal by setting aside the judgment of the

Division Bench and restore the direction passed by the Single Judge

with a direction to the appellants authorities to fix the compensation in

accordance with the provisions of Section 29 of the KIAD Act.  The said

exercise shall be done as expeditiously as possible.   

No order as to cost.

.............................................J. (A.K. SIKRI)

.............................................J. (R.K. AGRAWAL)

NEW DELHI; JANUARY 25, 2017.

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