Supreme Court restores enhanced compensation under Section 28-A based on High Court award

Background of the dispute

The Supreme Court in Banwari And Others Vs Haryana State Industrial and Infrastructure Development Corporation Limited (HSIIDC) And Another has examined the correct interpretation of Section 28-A of the Land Acquisition Act, 1894 and resolved a conflict between two earlier three-Judge Bench decisions.

The controversy arose from acquisition of agricultural land measuring 8 Kanal 17 Marla in village Majri, Tehsil Bahadurgarh, District Jhajjar, for the Kundli Manesar Palwal Expressway. The acquisition was initiated through a notification under Section 4 dated 17 November 2004 under the Land Acquisition Act, 1894.

By an award dated 1 March 2006, the Land Acquisition Collector (LAC) fixed compensation at Rs.12,50,000/- per acre.

The assessee–landowners (appellants) did not themselves seek a reference under Section 18. However, other landowners whose lands were acquired under the same notification filed references seeking enhancement of compensation. Those references came to be decided and ultimately led to an enhanced compensation being granted by the High Court, which then formed the foundation of the Section 28-A application filed by the present appellants.

Procedural history

Initial reference and High Court enhancement

  • Certain similarly placed landowners, aggrieved by the award dated 1 March 2006, filed references under Section 18 before the Additional District Judge, Jhajjar.
  • By order dated 17 January 2012, those reference petitions were dismissed, and the Collector’s award was upheld.
  • The aggrieved landowners then preferred Regular First Appeal (RFA) No. 429 of 2013 before the High Court of Punjab and Haryana.
  • By judgment and order dated 2 May 2016, the High Court allowed the RFA and enhanced compensation to Rs.19,91,300/- per acre, along with all statutory benefits.

Application under Section 28-A

The appellants in the present case had not availed the remedy under Section 18. Once the High Court granted higher compensation in RFA No. 429 of 2013, they invoked the redetermination mechanism under Section 28-A:

  • On 30 June 2016, the appellants filed an application under Section 28-A before the LAC, Jhajjar, seeking the same rate of compensation as granted by the High Court in the said RFA.
  • By order dated 15 September 2020, the LAC accepted the application and:
    • Recognised the appellants’ entitlement to the benefit of the High Court judgment dated 2 May 2016 in RFA No. 429 of 2013; and
    • Enhanced compensation to Rs.19,91,300/- per acre, together with statutory benefits on the same footing as granted to the other landowners whose appeals were allowed.

Writ petition before the High Court

Respondent No. 1, Haryana State Industrial and Infrastructure Development Corporation Limited (HSIIDC), challenged the LAC’s order via writ proceedings:

  • A writ petition was filed under Articles 226/227 of the Constitution of India before the High Court of Punjab and Haryana, being CWP No. 19814 of 2021 (O&M).
  • The High Court, relying on its earlier decision in CWP No. 8456 of 2020, titled “Haryana State Industrial and Infrastructure Development Corporation Limited v. Smt. Shanti and Others”, allowed the writ petition by judgment dated 25 November 2021.
  • In its earlier decision in Smt. Shanti and Others, the High Court had followed the Supreme Court ruling in Ramsingbhai (Ramsangbhai) Jerambhai v. State of Gujarat and Another, (2018) 16 SCC 445: 2018 INSC 405, holding that:
    • An application under Section 28-A must be predicated only on an “award” of the Reference Court under Section 18 (Part III of the 1894 Act); and
    • It cannot be based on a judgment of an appellate court under Section 54 (which falls in Part VIII of the Act).

On this reasoning, the High Court set aside the LAC’s order dated 15 September 2020.

The appellants, therefore, approached the Supreme Court in Civil Appeal No. 13348 of 2024, challenging the High Court’s decision.

Issues before the Supreme Court

The central questions considered by the Supreme Court were:

  1. Whether the benefit of Section 28-A of the Land Acquisition Act, 1894 can be claimed on the basis of an appellate court judgment (e.g., a High Court decision under Section 54), or is it restricted only to the original Reference Court award under Section 18.

  2. How to reconcile the apparent conflict between:

    • Union of India and Another v. Pradeep Kumari and Others, (1995) 2 SCC 736: 1995 INSC 180, and
    • Ramsingbhai (Ramsangbhai) Jerambhai v. State of Gujarat and Another, (2018) 16 SCC 445: 2018 INSC 405,
      both of which are three-Judge Bench decisions of the Supreme Court.

  3. Whether the appellants’ application under Section 28-A, filed within three months of the High Court’s judgment dated 2 May 2016 in RFA No. 429 of 2013, satisfied the statutory conditions for redetermination of compensation.

Arguments advanced

Submissions on behalf of the appellants

Counsel for the appellants contended: