Case: Delhi Development Authority Vs. Bhola Nath Sharma by L.Rs. and Ors

Udit Narain Singh Malpaharia v.Additional Member, Board of Revenue.) A local authority for whom land is being acquired has a right to participate in the acquisition proceedings in the matter of determination of the amount of compensation while they are pending before the Collector and to adduce evidence in the said proceedings. While it is precluded from seeking a reference against the award of the Collector it can defend the award and oppose the enhancement of the amount of compensation sought before the Reference Court by the person interested in the land. Moreover the local authority has a right to appear and adduce evidence before the Reference Court.Having regard to the aforesaid circumstances, we are of the opinion that the presence of the local authority is necessary for the decision of the question involved in the proceedings before the Reference Court and it is a proper party in the proceedings. The local authority is, therefore, entitled to be impleaded as a party in the proceedings before the Reference Court.In case the amount of compensation has been enhanced by the Court and no appeal is filed by the Government the local authority if adversely affected by such enhancement may file an appeal with the leave of the Court. This right of the local authority does not depend on its being impleaded as a party in the proceedings before the Reference Court. Even if the local authority is not impleaded as a party before the Reference Court it can file an appeal against the award of the Reference Court in the High Court after obtaining leave if it is prejudicially affected by the award. In case the Government files an appeal against the enhancement of the award the local authority is entitled to support the said appeal and get itself impleaded as a party. When the person having an interest in the land files an appeal in the High Court against the award of the Reference Court and seeks enhancement of the amount of compensation the local authority should be impleaded as a party in the said appeal and it is entitled to be served with the notice of the said appeal so that it can defend the award of the Reference Court and oppose enhancement of the amount of compensation before the High Court. The same will be the situation in case of an appeal to this Court from the decision of the High Court.” (Emphasis supplied) In Agra Development Authority v.Special Land Acquisition Officer, II (2001) SLT 22=(2001) 2 SCC 646, this Court held that as the land was acquired on behalf of the appellant, it was entitled to an opportunity to appear and adduce evidence on the issue of determination of the amount of compensation and the mere fact that it was aware of the proceedings and had participated in the meetings with the Government and Collector was not sufficient compliance with Section 50 of the Act. In Abdul Rasak v.Kerala Water Authority, I (2002) SLT 631=(2002) 3 SCC 228 , a two-Judge Bench considered the question whether the local authority on whose behalf the land was initially not acquired but to whom the land was subsequently transferred is entitled to be heard in the matter. While rejecting the argument that the Kerala Water Authority being a successor of the Public Health Department for whose benefit the land was initially acquired is not a necessary party, the Court observed: “Mr. T.L.V. Iyer, the learned Senior Counsel for the claimant- appellants has submitted that Kerala Water Authority is the successor of Public Health Engineering Department of the State Government, and bound by the proceedings conducted by or against the State Government and, therefore, the Constitution Bench decision does not have any applicability to the facts of the present case and the High Court ought not to have set aside the awards and remanded the cases to the Reference Court. We find it difficult to subscribe to the view so forcefully canvassed by the learned Senior Counsel for the appellants. KWA came into existence as a statutory corporation on 1.4.1984. It may be said to have succeeded to the liability incurred by the State Government so far as the quantum of compensation awarded by the Collector is concerned but so far as the enhancement in the quantum of compensation is concerned, it will be a liability of KWA incurred by it after its coming into existence and, therefore, to the extent of enhancement, the authority was certainly entitled to notice and right to participate in the proceedings before the Reference Court leading to enhancement of compensation.” (Emphasis supplied) The view expressed by the Constitution Bench in Gyan Devi’s case was reiterated in Kanak v.U.P. Avas Evam Vikas Parishad, V (2003) SLT 532=(2003) 7 SCC 693 and Regional Medical Research Centre, Tribals v.Gokaran, (2004) 13 SCC 125. 27. In view of the above discussion, we hold that: (i) the DDA falls within the definition of the expressions “local authority” [Section 3(aa)] and “person interested” [Section 3(b)] of the Act;(ii) the DDA was entitled to participate in the proceedings held before the Land Acquisition Collector;(iii) the failure of the Land Acquisition Collector to issue notice to the DDA and give an opportunity to it to adduce evidence for the purpose of determining the amount of compensation payable to the land owners was fatal to the award passed by him;(iv) the DDA was entitled to notice and opportunity to adduce evidence before the Reference Court could enhance market value of the acquired land entitling the respondents to claim higher compensation and, as no notice or opportunity was given to the DDA by the Reference Court, the judgments rendered by it are liable to be treated as nullity;(v) the Division Bench of the High Court also committed serious error by further enhancing the amount of compensation payable to the contesting respondents without requiring them to implead the DDA as party respondent so as to enable it to contest their prayer for grant of higher compensation.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]8. We are further of the view that delay in filing the special leave petitions deserves to be condoned because after having learnt about the impugned judgment, the concerned functionaries of the DDA took steps to collect the papers relating to the acquisition proceedings, sought opinion of theand the Solicitor General and then filed the special leave petitions. In the facts of this case, it is appropriate to invoke the principles laid down in Collector, Land Acquisition v. Katiji, (1987) 2 SCC 107  and State of Haryana v. Chandra Mani, III (1996) CLT 62 (SC)=(1996) 3 SCC 132 , for the purpose of condonation of delay. Accordingly, the application filed by the DDA for grant of permission to challenge the judgment of the High Court is allowed and delay in filing of the special leave petitions is condoned.In our view, proposition Nos. (iii) and (iv) extracted herein above are attracted in the present case because Special Leave Petition (C) No. 1608 of 1999 filed by the Union of India and the Land Acquisition Collector was summarily dismissed without going into the merits of thechallenge to the judgment of the High Court and no question of law was decided by this Court. That apart, this Court neither had the occasion nor did it decide the question whether the DDA, at whose instance the land was acquired as a part of the exercise undertaken for development of the area around Kalkaji temple, was entitled to participate in the proceedings held before the Land Acquisition Collector and the Reference Court for determination of the amount of compensation because no such plea was raised in Special Leave Petition(C) No. 1608/1999.Section 50(2) represents statutory embodiment of one of the facets of the rules of natural justice. The object underlying this section is to afford an opportunity to the local authority or company to participate in the proceedings held before the Collector or the Court for determining the amount of compensation and to show that claim made by the land owner for payment of compensation is legally untenable or unjustified. This is possible only if the Collector or the concerned Court gives notice to the local authority or the concerned company. If notice is not given, the local authority or the company cannot avail the opportunity envisaged in Section 50(2) to adduce evidence for the purpose of determining the amount of compensation. Therefore, even though the plain language of that section does not, in terms, cast a duty on the Collector or the Court to issue notice to the local authority or the company to appear and adduce evidence, the said requirement has to be read as implicit in the provision, else the same will become illusory.In view of the above discussion, we holdthe DDA falls within the definition of the expressionson 3(aa)] andon 3(b)] of the Act;(ii) the DDA was entitled to participate in the proceedings held before the Land Acquisition Collector;(iii) the failure of the Land Acquisition Collector to issue notice to the DDA and give an opportunity to it to adduce evidence for the purpose of determining the amount of compensation payable to the land owners was fatal to the award passed by him;(iv) the DDA was entitled to notice and opportunity to adduce evidence before the Reference Court could enhance market value of the acquired land entitling the respondents to claim higher compensation and, as no notice or opportunity was given to the DDA by the Reference Court, the judgments rendered by it are liable to be treated as nullity;(v) the Division Bench of the High Court also committed serious error by further enhancing the amount of compensation payable to the contesting respondents without requiring them to implead the DDA as party respondent so as to enable it to contest their prayer for grant of higher compensation.