FA/790/2007 1/54 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD FIRST APPEAL No. 790 of 2007 WITH FIRST APPEAL No.791 of 2007 To FIRST APPEAL No. 794 of 2007 For Approval and Signature: HONOURABLE MR.JUSTICE J.R.VORA HONOURABLE MR.JUSTICE M.R. SHAH ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================================= OIL & NATURAL GAS CORPORATION LTD - Appellant(s) Versus SANKARJI HEMAJI & 1 - Defendant(s) ========================================================= Appearance : M/S TRIVEDI & GUPTA for Appellant RULE SERVED for Respondent No.1 MR DIPEN DESAI ASST.GOVERNMENT PLEADER for Respondent No.2 ========================================================= CORAM : HONOURABLE MR.JUSTICE J.R.VORA and HONOURABLE MR.JUSTICE M.R. SHAH FA/790/2007 2/54 JUDGMENT Date : 13/03/2008 ORAL JUDGMENT (Per : HONOURABLE MR.JUSTICE M.R. SHAH) 1. As all these First Appeals arise out of common judgement and award passed by the learned Reference Court and raise common questions of fact and law, they are being disposed of by this common judgement and order. 2. In all these First Appeals, the appellants – original opponent No.2 – Oil and Natural Gas Corporation [ONGC] - acquiring body, has challenged the common judgement and award dtd. 15/10/2005 passed by the learned Principal Senior Civil Judge, Mehsana (Mr.J.R. Shah) (the “Reference Court” for short) in Land Reference Case Nos.3780 to 3784 of 2003, whereby the Reference Court has granted compensation of Rs.3 per sq.mtr. from the date of taking over possession upto 31/12/1983; Rs.3.33 per sq.mtr. from 1/1/1984 to 31/12/1985; Rs.4 per sq.mtr. from 1/1/1986 to 31/12/1987; Rs.4.50 per sq.mtr. from 1/1/1988 to 31/12/1990; Rs.5 per sq.mtr. from 1/1/1991 to 31/12/1993; Rs.6.66 per sq.mtr. from FA/790/2007 3/54 JUDGMENT 1/1/1994 to 31/12/1996; Rs.8.33 per sq.mtr from 1/1/1997 to 31/12/1999; Rs.10 per sq.mtr. from 1/1/2000 to 31/12/2002; Rs.12 per sq.mtr. from 1/1/2003 to 31/12/2004 and thereafter Rs.15 per sq.mtr. from 1/1/2005 onwards, against an amount of Rs.0.35 ps. per sq.mtr. originally awarded by the Special Land Acquisition Officer under sec.35 of the Land Acquisition Act (“the Act” for short). The Reference Court also further directed the appellant Corporation to pay arrears of compensation with interest at the rate of Rs.12% p.a. from the date on which the amount has become due till 31/12/1999 and thereafter at the rte of 9% p.a. till the amount is realised or paid by the appellant. The Reference Court by the aforesaid judgement and award has also further directed that the amount of compensation fixed at Rs.15 per sq.mtr will be increased at 15% at every interval of three years commencing from 1/1/2005 and the said increase will be calculated on the last presiding amount. The reference court has further observed to the effect that in the event of land not being surrendered to the original land owner, then in that case, the claimants will have right after expiration of period of 20 years to move the competent court for refixation of the amount of FA/790/2007 4/54 JUDGMENT compensation in future. 3. All the respondents herein – original land owners/ claimants are owners of their respective lands situated at village Dhanpura, Taluka Mehsana, District ; Mehsana which came to be temporarily acquired by the State Government for ONGC under sec.35 of the Act in the year 1980 and the possession of the said land have been taken over by the ONGC on 11/8/1980 on payment of compensation by way of rent at the rate of Rs.0.35 paise per sq.mtr. per annum. The Special Land Acquisition Officer declared award determining compensation/rent at the rate of Rs.0.35 paise on 11/8/1980. The said amount came to be accepted by the original land owners. The Reference Applications were filed by the respective claimants on 16/7/2001 i.e. after a period of 21 years from the date of taking over possession and declaring the award, making a grievance in respect to the amount of compensation / rent determined by the Special Land Acquisition Officer vide Award dtd.11/8/1980 and the said applications were submitted before the Special Land Acquisition Officer, ONGC, Unit-II, Mehsana on 16/7/2001 and it was requested to refer the said applications to the FA/790/2007 5/54 JUDGMENT reference court. The Special Land Acquisition Officer, ONGC, Unit-II, Mehsana referred the said applications to the Reference Court which were submitted in respect to the inadequacy of amount of compensation / rent and the same were numbered as Land Reference Case Nos.3780 to 3784 of 2003. All the aforesaid Land Reference Cases were consolidated by the reference court. Written Statements were filed by both the original opponents i.e. acquiring body [ONGC] at Ex.6 as well as the Special Land Acquisition Officer at Ex.8, raising objections in respect to the reference applications being time barred and that the amount of compensation and that of annual rent was never disputed by the applicants / claimants and therefore, are not maintainable under the provisions of the Act. That number of other objections were raised with regard to maintainability of the reference applications and adequacy of compensation/rent. It was also submitted that in fact, subsequently, the ONGC, from time to time at the interval of three years, on the basis of administrative decision, has increased the rent which have been accepted by the claimants without any objection. The reference Court framed the following issues at Ex.18:- FA/790/2007 6/54 JUDGMENT (i) Whether the compensation awarded by the Special Land Acquisition Officer is not fair and adequate? (ii)What additional compensation the claimants are entitled in land acquisition? (iii)What order and award? 4. On behalf of all the claimants, claimant of L.A.R No.3780 of 2003 namely Thakor Shivaji Hemaji came to be examined at Ex.11. His written examination in chief was submitted by the learned advocate on 1/4/2005. He was cross examined by the learned advocate appearing on behalf of the acquiring body [ONGC] as well as District Government Pleader on behalf of the State. On behalf of the acquiring body one Mr.Rameshkumar Prajapati came to be acquired at Ex.12. He was cross examined by the learned advocate appearing on behalf of the claimants. On behalf of the acquiring body – ONGC written submissions dtd.20/9/2005 were submitted vide Ex.14. The learned reference court passed the impugned judgement and award vide Ex.15 awarding compensation/rent with other benefits as stated hereinabove. While passing the impugned judgement and award, the learned reference court not only held that FA/790/2007 7/54 JUDGMENT the reference applications are submitted within the period of limitation but also held that the entire land acquisition proceedings under sec.35 of the Act in respect to the land in question are illegal, nullity, null & void and even the award declared under sec.35 of the Act is also bad in law and nullity. The reference Court also held that the possession of the ONGC – acquiring body is unauthorised and that they are trespasser. The reference Court also held that as the entire land acquisition proceedings are illegal and nullity and the possession by the acquiring body is unauthorised and they are trespassers, the claimants are entitled to get back the possession. However, the reference court did not restore the possession by observing that whatever is done by the acquiring body is in the public interest. The reference court directed that the aforesaid amount be paid by way of mesne profit as the acquiring body is in unauthorised possession and occupation of the land in question. In para 31 the reference court has also held that the ONGC – acquiring body is in possession of the land in question as permissive users. Being aggrieved by and dissatisfied with the judgement and award dtd. 15/10/2005 passed by the learned Principal Senior Civil Judge, Mehsana FA/790/2007 8/54 JUDGMENT (Mr.J.R. Shah) (the “Reference Court” for short) in Land Reference Case Nos.3780 to 3784 of 2003, the appellants herein – original opponent No.2 has preferred these appeals under sec.54 of the Land Acquisition Act. . 5. Points for consideration:- (i) Whether the reference court was justified in entertaining the reference applications under sub- section (3) of section 35 of the Land Acquisition Act, which were submitted after a period of 21 years from the date of taking possession? (ii)Whether the reference can decide the disputes other than sufficiency of the compensation, such as legality and validity of the temporary acquisition under sec.35 of the Land Acquisition Act; declaration of the Award etc. in a reference under sub-section (3) of section 35 of the Land Acquisition Act? (iii)Whether the reference court in a reference under sub-section (3) of Section 35 of the Land acquisition FA/790/2007 9/54 JUDGMENT Act can decide any dispute other than the dispute which is referred to it? (iv)Whether the reference court in a reference under sub-section (3) of section 35 of the Land Acquisition Act has jurisdiction and/or authority to pass an order restoring possession of the land to the owners? (v)Whether the reference court in a reference under sub-section (3) of section 35 of the Land Acquisition Act has jurisdiction to declare the possession of the acquiring body as illegal, unauthorised and/or declare the acquiring body as trespasser? (vi) Whether the reference court in a reference under sub-section (3) of section 35 of the Land Acquisition Act has jurisdiction to determine and/or award compensation rented for a period beyond the period of three years? (vii)Whether the reference in a reference court under sub-section (3) of section 35 of the Land Acquisition Act has jurisdiction to award compensation by way of mesne profit beyond the period of three years from the date of taking possession? (viii)Whether the reference court in a reference under FA/790/2007 10/54 JUDGMENT sub-section (3) of section 35 of the Land Acquisition Act has jurisdiction to declare acquisition proceedings and award declared by the Collector under sub-section (3) of section 35 of the Land Acquisition Act as illegal and/or non-est? (ix)Whether the reference court in a case of temporary acquisition has jurisdiction to award statutory benefits and/or interest as if the acquisition proceeding is permanent acquisition? 6. Submissions on behalf of the appellant:- Mr.Naik, learned advocate appearing on behalf of the appellant has submitted that the reference applications submitted by the claimants dtd.16/7/2001 itself were not maintainable as no were objections raised by the claimants at the time of award dtd.11/8/1980 with respect to sufficiency of compensation. Considering sec.35(3) of the Act, only in case the Collector and the person interested differ as to the sufficiency of the compensation or apportionment thereof, the Collector is required to refer such difference to the decision of the Court. It is submitted that even considering the deposition of the claimant at Ex.11, his father had not FA/790/2007 11/54 JUDGMENT submitted any objection and even the amount of compensation/rent fixed at the relevant time was just. 7. It is also further submitted by the learned advocate appearing on behalf of the appellant that even otherwise, the reference applications submitted by the original claimants dtd.16/6/2001 for making the reference to the reference court, were not maintainable inasmuch as the same were submitted after a period of 21 years after the alleged cause of action has arisen. It is submitted that as in sec.35(3) of the Act, no period of limitation has been prescribed, Article 137 of the Limitation Act, 1963 would come into play and therefore, at the most the applications were required to be filed within three years from the date of possession i.e. 4/6/1980, therefore even the applications for reference were time barred and beyond the period of limitation and therefore, as such the Special Land Acquisition Officer ought not to have referred the applications to the reference court. It is also alternatively submitted that assuming without admitting that no period of limitation has been provided under sec.35 of the Act, the applications could be maintainable only if filed within a reasonable time i.e. at the most filed FA/790/2007 12/54 JUDGMENT within a period of six months. The learned advocate appearing for the appellant has relied upon the following decisions in support of his submissions :- (i) in the case of State of Karnataka Vs. Laxuman, reported in (2005) 8 SCC 709 (paras 9 to 20); (ii)in the case of the Kerala State Electricity Board, Trivandrum Vs. T.P. Kunhaliumma, reported in (1976) 4 SCC 634 (paras 11 to 22); (iii)in the case of Bayer Aktiengesellschft of Leverkusen Federal Republic of Germany Vs. Controller of Patents, Government of India, reported in AIR 1982 Cal. 30 (paras 4 to 6). (iv)in the case of the State of Gujarat Vs. Patil Raghav Natha & Ors., reported in (1969) 2 SCC 187 (paras 11,12) and (v)in the case of Meher Rusi Dalal Vs. Union of India & Ors., reported in (2004) 7 SCC 362 (para 24). 8. It is also further submitted by the learned advocate appearing on behalf of the appellant that the applications filed by the original claimant dtd.16/7/2001 were not maintainable inasmuch as there was no dispute or difference raised at the relevant time with regard to FA/790/2007 13/54 JUDGMENT amount of compensation determined by the Collector. It is submitted that in light of the evidence of the claimant recorded at Ex.11 and more particularly the admission on the part of the claimant, it becomes clear that there did not exist any dispute as regards compensation for temporary acquisition of the subject land in the year 1980. 9. It is further submitted by Mr.Naik, learned advocate appearing on behalf of the appellant that the reference made by the Collector for determination of the compensation is also without jurisdiction, authority, power or competence inasmuch as when the original owner i.e. father of the respondent No.1 had agreed to the amount of compensation, no reference could have been made under sec.35 of the Act. With reference to the findings of the Court that the entire acquisition proceedings and the award under sec.35 of the Act are illegal, null and void and nullity and that the acquiring body is in unauthorised occupation and possession of the land and they are trespassers, Mr.Naik, learned advocate appearing on behalf of the appellant has submitted that all the aforesaid findings recorded by the reference court FA/790/2007 14/54 JUDGMENT are without jurisdiction. It is submitted that sec.35 of the Act confers limited jurisdiction on the reference court to determine only the question as regards sufficiency of compensation and that too in a case of difference between the Collector and the persons interested. It is submitted that the reference court, acquiring jurisdiction under sec.35 of the Act, does not have jurisdiction, power, authority or competence to travel to adjudicate issue beyond the terms of the reference. It is further submitted that the findings of the reference court that the reference court has all rights, power and authority to adjudicate every question falling under the ambit of the provisions of the Act, is without jurisdiction and authority under the law. Mr.Naik, learned advocate appearing on behalf of the appellant has relied upon the following decisions in support of his above submissions:- (i) in the case of Balram Chandra Vs. State of U.P., reported in (1995) 3 SCC 723 (para 4); (ii)in the case of P.K.Sreekantan & Ors. VS. V.P. Sree Kumaran Nair & Ors., reported in AIR 2007 SC 516 (paras 7 & 12 to 15; (iii)in the case of Prayag Upnivesh Awas Evam Nirman FA/790/2007 15/54 JUDGMENT Sahkari Samiti Ltd. Vs. Allahabad Vikas Pradhikaran & Anr., reported in (2003) 5 SCC 561 (paras 7 to 10); (iv)in the case of Patel Shambhubhai Bhaichanddas Vs. State of Gujarat & Anr., reported in 2007 (2) GLH 272 (paras 4,5,6,8 & 10 to 12) and (v)in the case of ONGC Ltd. Vs. Pandya Prahladbhai Manilal & Ors., reported in 2006(3) GLH 662 (paras 10 to 16). 10.It is also further submitted that the reference court does not have any jurisdiction to determine the issue of validity of acquisition. It is submitted that the reference court acquiring jurisdiction under sec.35 of the Act, does not have any power, authority or competence to decide any other issue except limited question of sufficiency of compensation. 11.It is also further submitted that the reference court does not have any jurisdiction to decide the issue with regard to possession of the subject land by the Corporation and therefore, the observations made by the reference court to the effect that the Corporation is in possession of the land as a trespasser, are absolutely without jurisdiction, illegal, invalid and unjustified. FA/790/2007 16/54 JUDGMENT 12.It is also further submitted that even otherwise without framing any proper issue with respect to the validity of the acquisition proceedings, possession of the Corporation etc. no such findings could have been given by the reference court. It is also further submitted that even the claimants in their reference applications dtd.16/7/2001 have never made any grievance with regard to acquisition proceedings and/or possession of the Corporation. Thus, the aforesaid findings by the Reference Court are beyond the terms of the reference. 13.It is also further submitted that the reference court has made self contradictory observations in the award inasmuch the reference court on the one hand has observed that the possession of the Corporation amounts to trespassing and on the other hand has observed that the Corporation occupies the land under permissive user with the consent of the land owners. 14.It is also further submitted that the observations and the findings of the reference court that the claimants are entitled to the damages as mesne profit are completely FA/790/2007 17/54 JUDGMENT without jurisdiction, illegal, unjustified and improper. It is submitted that the reference court does not have any jurisdiction to decide such issue in a reference under sec.35 of the Act. It is submitted that only in a suit wherein decree for possession is sought, and it is found that the occupier is in illegal and/or unauthorised possession, in that case only the order for mesne profit can be passed, that too by the competent court having competence to pass a decree for possession. It is submitted that in the present case in a reference under sec.35 of the Act, the reference court has no such jurisdiction to order restoration of possession. It is further submitted that even otherwise, the claimants have been paid increased rate from time to time and the same has been admitted by the claimants in the cross examination and that they have accepted the same without raising any objection. It is submitted that even in the cross examination at Ex.11, the claimant who has been examined on behalf of all the claimants, has admitted that the claimants are satisfied with the rent presently paid to them. 15.It is further submitted by Mr.Naik, learned advocate FA/790/2007 18/54 JUDGMENT appearing on behalf of the appellant that the reference court has committed an error in holding that the Corporation did not produce any material as to how and on what basis the periodical rise has been given and thereby drawing adverse inference. It is submitted that only in a case where ONGC is called upon to produce certain things and the Corporation does not produce the same, in that case, adverse inference can be drawn and not otherwise. It is further submitted that even the reference court has acted beyond its jurisdiction in awarding increased rent as reflected in the final judgement and award beyond the period of temporary acquisition under the Act which is three years. It is submitted that as held by this Court, considering sec.35 of the Act, reference court would have jurisdiction to award compensation/rent only for a maximum period of three years and for the period thereafter, the reference court would have no jurisdiction to award compensation/rent. He has relied upon the decisions in the case of Patel Shambhubhai Bhaichanddas (supra) and Pandya Prahladbhai Manilal (supra). 16.It is also further submitted that even the findings of the FA/790/2007 19/54 JUDGMENT reference court with respect to the reference applications within the period of limitation on the basis of his interpretation of sec.35, are perverse and illegal. 17.It is also further submitted that the entire judgement and award more particularly operative portion of the judgement and award by directing the appellant to pay enhanced compensation/rent for different period which are mentioned hereinabove is perverse, illegal, without jurisdiction and without authority under the law. 18.It is also further submitted that the reference court does not have jurisdiction to grant interest on the compensation awarded by it in the Award under challenge. In support of his above submission, he has relied upon the decision of the Hon'ble Supreme Court in the case of Brij Behari Sahai Vs. State of Uttar Pradesh, reported in (1986) 3 SCC 564 (paras 4 & 5). 19.Mr.Naik, learned advocate appearing on behalf of the appellant has further submitted that the reference court has even not considered and/or appreciated the cross FA/790/2007 20/54 JUDGMENT examination of the claimant who has been examined on behalf of all the claimants examined at Ex.11. It is submitted that even the claimant in his cross examination has admitted that he does not know what is stated in the reference application and what amount he asked has in the application. It is admitted by the claimant in the cross examination that whatever is written in the application, is written by the advocate without his instructions and/or knowledge. It is also submitted by Mr.Naik learned advocate appearing on behalf of the appellant that even the signature of the claimant – Thakor Shivaji Hemaji defers in the reference application and in the deposition before the Reference Court. Therefore, it is submitted that even the reference application might not have been signed by the claimants. It is also further submitted by Mr.Naik that even the amount of compensation/rent determined by the reference court is without any basis and/or material. Making above submissions, Mr.Naik, learned advocate appearing on behalf of the appellant has requested to quash and set aside the impugned judgement and award with costs. FA/790/2007 21/54 JUDGMENT 20.Mr.Dipen Desai, learned Assistant Government Pleader appearing on behalf of the Special Land Acquisition Officer has adopted the submissions made on behalf of the appellant and has submitted that the impugned judgement and award require to be quashed and set aside as the same is without jurisdiction. It is fairly conceded by him that even the Special Land Acquisition Officer ought not to have referred the reference to the reference court when the reference applications were submitted after a period of 21 years and when there was no dispute raised by the original claimant at the time when the award was declared and the amount of compensation/rent was determined in the year 1980. 21.Mr.A.V. Prajapati, learned advocate appearing on behalf of the one of the claimant has opposed all these appeals. He has tried to support the judgement and award passed by the reference court by submitting that considering the fact that under the provisions of the Act more particularly sec.35 of the Act, temporary acquisition can be only for a maximum period of three years and any occupation and possession of the acquiring body after a period of three years would be illegal and unauthorised and therefore, FA/790/2007 22/54 JUDGMENT the reference court has rightly held the possession of the ONGC as illegal and unauthorised and has rightly awarded mesne profit. It is also submitted by Mr.Prajapati that the reference court has rightly appreciated the deposition of the claimant at Ex.11 considering the fact that the claimant who has been examined at Ex.11 is an illiterate person who might not have properly understood the questions. It is submitted that the reference court has rightly given more weightage to the interest of the land owners against the mighty ONGC. It is also submitted by him that the reference court has rightly