Day 5 Arguments

Land Acquisition

November 6th 2019

The Bench comprising Justices Arun Mishra, Indira Banerjee, M.R.Shah, Vineet Saran and S.R.Bhat commenced hearing the matter today on merits. In a day-long hearing, Solicitor General Tushar Mehta (SG) made submissions on the interpretation of Section 24 of the Land Acquisition Act, 2013 and the proviso.


Outlining the issues and scope of the proviso

SG commenced his submissions by broadly outlining the issues for determination: a) the meaning of the word ‘paid’ used in s.24(2), b) whether a period of stay on the land acquisition proceedings basis a court order should be excluded from the calculation of 5 years prescribed under s.24(2), c) whether the proviso is to be read only as a proviso to s.24(2) or also to s.24(1).


On the third issue, he argued that the proviso should only be read as a proviso to s.24(2). This, he submitted, would ensure a balance between public interest and the interest of the individual landowners.


He further argued that proviso to s.24(2) had deliberately provided for compensation to be deposited only for a majority of the beneficiaries and not everyone. Any other interpretation, he submitted, would be impracticable given the problem of benami properties in India.


Responding to Bench’s queries on the effect of some of the landowners not accepting payment, SG submitted that the intent behind the Act was to ensure that major public infrastructure projects are not stalled. Here, he referred to the Parliamentary debates and pointed out that as long as the majority is paid, the proceedings should not lapse.


Meaning of ‘paid’

On the meaning of ‘paid’ appearing in s.24(2), SG argued that compensation paid into the treasury should be construed as payment for the purposes of the provision. This argument of the SG was aimed at discrediting the ratio of Pune Municipal Corporation, which had held that payment had to be made to the jurisdictional court.


He also placed reliance on parliamentary debates to assert that payment envisaged in s.24(2) did not equate to depositing the money in the bank account of the beneficiaries. Thus, he submitted that even deposit in treasury should be considered to be payment for the purposes of the provision.


(With this, the Bench rose for lunch. It re-assembled at 2:05 pm)


For the large part of the post-lunch session, a co-counsel of SG made arguments on his behalf. The co-counsel continued submissions on the meaning of the word ‘paid’. Following was the crux of his submissions:

  • S.24 in the 2013 Act consciously omits the mode of payment, unlike the 1894 Act. Thus, mode is irrelevant for the purpose of the section;
  • The words ‘paid’ and ‘deposited’ should not take colour from the provisions of the 1894 Act but should be given their natural meaning; and
  • Proceedings for the purpose of s.24 can be held to lapse only if the government makes no provision for payment.


Upon these submissions, Justice Mishra J. observed that the words ‘paid’ and ‘deposited’ cannot be given the same meaning (both these words appear in Section 24). While ‘paid’ means payment is complete, ‘deposit’ is a temporary arrangement.


To this, the co-counsel responded that there are multiple judgments which have held that ‘paid’ means making the payment ‘available’. Therefore, as long as the government has deposited the amount in its treasury, its obligations under the provision are fulfilled. Continuing on this, he further submitted that proceedings lapse only if there is some fault on part of state.


SG then arrived and compared the provisions of the 1894 Act with the new Act to establish that ‘paid’ has a different connotation to ‘deposit’ and therefore should not be equated to payment to the court.


A final intervention for the day was made by Justice Mishra who observed that the concept of depositing the payment with the court is not found in the new Act, unlike the 1894 Act. In this regard he also observed that the word ‘paid’ only appears in s.24. In s.31 of the 1894 Act, the words used are ‘tender payment’. Contrasting the two, he asked whether the government’s obligations are fulfilled once payment is merely made available.


With this, the hearing for the day came to a close. The hearing is expected to continue tomorrow.

(Court reporting by Avinash Amarnath)