Section 24 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013: Constitution Bench Authoritatively Resolves the Lapse Controversy

Overview

The Supreme Court of India, through a five-judge Constitution Bench, has delivered a landmark pronouncement in Indore Development Authority Vs Manoharlal & Ors. Etc., conclusively settling a protracted judicial controversy surrounding the interpretation of Section 24 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (hereinafter "the Act of 2013"). The ruling resolves conflicting lines of authority that had accumulated over several years and provides definitive guidance on when land acquisition proceedings initiated under the repealed Land Acquisition Act, 1894 (hereinafter "the LA Act") stand deemed to have lapsed.

Background and Genesis of the Reference

Why a Five-Judge Bench Was Constituted

The interpretive dispute surrounding Section 24 of the Act of 2013 did not emerge in isolation. A three-judge Bench of the Supreme Court had earlier rendered its decision in Pune Municipal Corporation & Anr. v. Harakchand Misirimal Solanki & Ors., (2014) 3 SCC 183, interpreting Section 24 and laying down the conditions for deemed lapse of acquisition proceedings. That decision was subsequently followed in Sree Balaji Nagar Residential Association v. State of Tamil Nadu, (2015) 3 SCC 353, among other rulings.

However, a two-judge Bench in Yogesh Neema & Ors. v. State of Madhya Pradesh, (2016) 6 SCC 387 doubted the approach taken in Sree Balaji Nagar Residential Association — particularly the holding that Section 24(2) of the Act of 2013 does not exclude any period during which the land acquisition proceeding remained stayed pursuant to an injunction granted by a court — and referred the issue to a larger Bench.

Subsequently, in proceedings arising from SLP(C) No. 2131 of 2016, reported as Indore Development Authority v. Shailendra (Dead) through L.Rs. & Ors., 2018 SCC OnLine SC 100, a three-judge Bench observed:

"cases which have been concluded are being revived. In spite of not accepting the compensation deliberately and statement are made in the Court that they do not want to receive the compensation at any cost, and they are agitating the matter time and again after having lost the matters and when proceedings are kept pending by interim orders by filing successive petitions, the provisions of section 24 cannot be invoked by such landowners."

Two of the learned judges in that Bench also expressed a prima facie view that Pune Municipal Corporation (supra) may have been rendered per incuriam, given that several relevant aspects of Section 24 had not been considered therein. The matter was accordingly referred to a larger Bench. Further references followed in Indore Development Authority v. Shyam Verma & Ors. and State of Haryana v. Maharana Pratap Charitable Trust (Regd.) & Anr., all of which were consolidated and placed before the present five-judge Constitution Bench.

Questions Framed for Consideration

The Constitution Bench crystallised the following questions for authoritative determination:

  1. What is the meaning of the expressions "paid" and "tender" in Section 24 of the Act of 2013 and Section 31 of the LA Act? Does non-deposit of compensation in court under Section 31(2) of the LA Act result in lapse under Section 24(2) of the Act of 2013? What are the consequences where compensation was tendered but refused?

  2. Whether the word "or" in Section 24(2) of the Act of 2013 operates conjunctively or disjunctively?

  3. What is the true effect of the proviso — does it form part of Section 24(2) or of the main Section 24?

  4. What is the mode of taking possession under the LA Act and what is the true meaning of the expression "the physical possession of the land has not been taken" in Section 24(2)?

  5. Whether periods covered by interim court orders in land acquisition proceedings must be excluded for computing the five-year period under Section 24(2)?

  6. Whether Section 24 of the Act of 2013 revives barred and stale claims?

In addition, the questions of per incuriam and other incidental matters were also directed to be examined.

Statutory Framework: Understanding Section 24 of the Act of 2013

Legislative Context

The Act of 2013 repealed and replaced the Land Acquisition Act, 1894 — a general law governing compulsory acquisition of land for public purposes that had remained operative for approximately 120 years. The Act of 2013 was enacted prospectively, but Section 24 — which opens with a non-obstante clause and overrides all other provisions of the Act of 2013 — creates a transitional framework that governs the fate of pending acquisition proceedings initiated under the LA Act.

Structure of Section 24

Section 24 operates at two levels: