Oil and Natural Gas Corporation Ltd. vs Bansidhar Badridas Modi (P.) Ltd.

B.P. Katakey, J.—These appeals and the cross-objections arise out of the common judgment and order dated 31st August, 2002 passed by the Reference Court in Misc. LA case No. 120/1995; Misc. LA case No. 121/1995; Misc. LA case No. 122/1995; Misc. LA case No. 123/1995 and Misc. LA case No. 124/1995 corresponding to LA case No. 29/1990-91; LA case No. 5/1992-93; LA case No. 1/1991-92; LA case No. 18/1991-92 and LA case No. 18/1990-91, respectively.

The aforesaid land acquisition proceedings were initiated by the Collector, Sivasagar District on 7th June, 1994; 27th January, 1993; 11th May, 1994, 11th May, 1994 and 10th September, 1993 by issuing notification u/s 4(1) of the Land Acquisition Act, 1894 (''the Act'') for acquisition of 68 Bighas, 1 Katha 6, Lechas; 8 Bighas, 0 Katha, 12 Lechas; 46 Bighas, 2 Kathas, 2 Lechas; 19 Bighas, 0 Katha, 5 Lechas and 3 Bighas, 0 Katha, 2 Lechas of lands respectively, belonging to the Respondents herein. The possession of the aforesaid land, however, was taken over, before issuance of the preliminary notifications u/s 4(1) of said Act, on 5th February, 1992; 12th April, 1991; 1st June, 1993; 12th August, 1992 and 15th March, 1991, respectively. In due course of time, the declarations u/s 6 of the Act were issued. The awards by the Collector in LA case No. 29/1990-91; LA case No. 18/1990-91; LA case No. 5/1992-93; LA No. 18/1991-92 and LA case No. 1/1991-92 were passed on 6th February, 1995; 3rd February, 1995; 15th July, 1994; 13th February, 1995 and on 3rd February, 1995, respectively. The awarded amount was received by the Respondents on 1st March, 1995 under objection. The Respondents being not satisfied with the amount awarded for acquisition of the land, thereafter, filed applications u/s 18 of the Act on 30th May, 1995 requesting the Collector to refer the dispute to the court as envisaged under the provisions of the said Act, on the basis of which 5 (five) references were made by the Collector to the court of the learned District Judge at Sivasagar, pursuant to which the aforesaid reference cases were registered.

By the impugned common judgment and order dated 31st August, 2002, the Reference court has held that though the possession of the land acquisitioned was taken over prior to issuance of the preliminary notification u/s 4(1) of the Act, the land owners would be entitled to further amount u/s 23(1A), at the rate of twelve per centum on the market value ascertained u/s 23 of the Act, from the date of taking over the possession till the date of passing the final award. The Reference court has further held that the land owners would also be entitled to simple interest @ 9% per annum, u/s 34 of the Act, from the date of the award till the date of the payment The Collector accordingly was directed to make payment of the amount payable towards the interest within 2 (two) months, failing which, it has been held that the land owners would be entitled to interest @ 15% per annum.

The requiring department, namely Oil and Natural Gas Corporation Ltd. CONGO, being aggrieved by the first part of the aforesaid impugned judgment and order, i.e. awarding further compensation to the land owners, u/s 23(1A) of the Act, from the date of taking over possession to the date of passing of the award, has filed the present land acquisition appeals u/s 54 of the Act. The Respondents in LA Appeal Nos. 2/2003; LA Appeal No. 3/2003; LA Appeal No. 6/2003 and LA Appeal No. 7/2003 have filed the aforesaid cross-objections challenging the second part of the judgment, whereby and whereunder it has been held that the land owners would be entitled to simple interest @ 9% per annum u/s 34 of the Act from the date of passing of the award till the date of payment, contending that such interest u/s 34 is payable from the date of taking over possession till the date of the payment, for the first 1 (one) year @ 9% and for subsequent period @ 15%.

I have heard Mr. P.C Deka, learned senior counsel assisted by Mr. N. Anix Singh learned Counsel for the Appellants and Mr. D. Senapati, learned Counsel appearing for the Respondents in all the appeals, who are also the cross-objectors in the aforesaid cross-objections.

Mr. Deka, learned senior counsel for the Appellants referring to the provisions of Section 23(1A) of the Act has submitted that the further compensation @ 12% per annum, on the market value of the land ascertained u/s 23(1) of the Act, is payable to the land owners only from the date of issuance of the notification u/s 4(1) till the date of the award or the date of taking over the-possession of the land, whichever is earlier. According to Mr. Deka, since the possession of the land can be taken over under the provisions of the said Act only after issuance of notification u/s 4(1) of the Act, the land owners at the most, would be entitled to further compensation u/s 23(1A) of the Act from the date of issuance of the preliminary notification u/s 4(1) till the date of the award and not from the date of taking over possession, which was prior to issuance of the notification u/s 4(1) of the Act. The learned senior counsel, therefore, submits that the judgment passed by the Reference court directing payment of interest, u/s 23(1A) of the Act, from the date of taking over possession of the land till the date of final award requires to be interfered with and set aside.

It has also been submitted by the learned senior counsel for the Appellants that the reference petition filed by the Appellants u/s 18 of the Act is barred by time, the same having not been filed within 6 (six) weeks from the date of receipt of the notice of the award, which was 22nd February, 1995 and as such, the Reference Court ought to have dismissed the reference proceeding on the ground that the petitions u/s 18 were filed beyond the time as provided under proviso to Section 18 of the Act.

Relating to the cross-objections filed by the Respondents/land owners, it has been submitted by Mr. Deka, learned Sr. Counsel for the Appellants that since under the scheme of the Act, generally possession can be taken over only after passing of the award by the Collector u/s 11 of the Act, no interest u/s 34 of the Act is awardable from the date of taking over the possession, if such possession was taken over prior to issuance of the preliminary notification u/s 4(1) of the Act. According to Mr. Deka, the Respondents/land owners would be entitled to interest u/s 34 of the Act from the date of the award till the date of making payment, as has been awarded by the Reference Court. Mr. Deka submits that the judgment and order passed by the Reference court in that respect needs no interference.

Mr. Senapati, learned Counsel appearing for the Respondents/land owners, on the other hand, has submitted that since the possession of the land was taken over prior to issuance of the notification u/s 4(1) of the Act, the land owners are entitled to further compensation, at the rate of twelve per centum on the market value, u/s 23(1A) of the Act from the date of taking over possession till the date of passing of the final award u/s 11 of the Act. It has also been submitted that on the same analogy, the land owners are also entitled to interest u/s 34 of the Act, for the first year @ 9% and thereafter, @ 15% from the date of the possession till the date of payment. Relating to the contention of the learned senior counsel for the Appellants that the applications filed u/s 18 of the Act were barred by time, it has been submitted by Mr. Senapati, the learned Counsel for the Respondents that the notice dated 22nd February, 1995, which was proved and marked as Exhibit-3, cannot be treated as the notice required to be issued under Sub-section (2) of Section 12 of the Act. According to Mr. Sentapati, since the applications u/s 18 were filed within 6 (six) months from the date of passing of the award, the said applications were within time as provided under Sub-section (2) of Section 18 of the Act.

I have considered the submissions of the learned Counsel for the parties and also perused the materials available on record including the judgment and order dated 31st August, 2002 passed by the Reference Court.

From the submissions of the learned Counsel for the parties, as have been noticed above, the following points are required to be decided in the present batch of appeals and the cross-objections:

(1) Whether the applications filed by the land owners u/s 18 of the Act are barred by time?

(2) Whether the land owners are entitled to further compensation @ twelve per centum per annum, on the market value ascertained u/s 23(1) of the Act, from the date of taking over the possession of the land acquired, which was prior to issuance of the notification u/s 4(1) of the Act, till the date of passing of the award u/s 11 of the Act?

(3) Whether the land owners are entitled to interest, u/s 34 of the Act, from the date of taking over the possession of the land, which was prior to the preliminary notification issued u/s 4(1) of the Act, till the date of payment?

Sub-section (1) of Section 18 of the Act provides that any person interested, who has not accepted the award, may by written application to the Collector, require that the matter be referred by the Collector for the determination of the court, whether his objection be to the measurement of the land, the amount of the compensation, the persons to whom it is payable, or the apportionment of the compensation among the persons interested. Proviso to Section 18 stipulates the time limit within which such application, seeking reference of the dispute, is required to be filed before the Collector. Clause (a) of the said proviso stipulates that such application has to be filed within 6 (six) weeks from the date of passing of the award by the Collector if the person filing such application, was present or represented before the Collector at the time when he made his award. Clause (b) provides that in other cases such application has to be filed within 6 (six) weeks of the receipt of the notice from the Collector under Sub-section (2) of Section 12 or within 6 (six) months from the date of the Collector''s award, which period shall expire first. The said period, as stipulated in proviso to Section 18, cannot be extended either by the Collector or by the court.

In the instant cases, it is not in dispute that the persons interested were not present at the time of making the award and, therefore, Clause (a) of proviso to Section 18 is not applicable. According to the requiring department, namely ONGC, since the notice of the award was issued on 22nd February, 1995, which was received by the persons interested, namely the Respondents, applications u/s 18 of the Act were required to be filed within 6 (six) weeks from the date of the said notice, i.e., by 7th April, 1995 but as such applications were filed on 30th April, 1995, the same were barred by time, in view of the provisions contained in Clause (b) of proviso to Section 18 of the Act.

The said contention, however, has been refuted by the learned Counsel appearing for the Respondents contending that the notice dated 22nd February, 1995 cannot be treated as a notice issued u/s 12(2) of the Act, as the said notice does not contain any particulars relating to the award passed except intimating the date for collection of the compensation awarded. Referring to the decision of the Apex Court in Bhagwan Das and Others Vs. State of UP and Others, it has been submitted by Mr. Senapati that since the purpose of issuing the notice u/s 12(2) of the Act is to make aware the land owner about all the relevant particulars of the award so as to enable him to decide whether he should seek reference or not and since the notice dated 22nd February, 1995 does not contain any particulars of the award passed, the same cannot be treated as notice u/s 12(2) of the Act and hence, the land owners get 6 (six) months time for filling the application u/s 18 of the Act from the date of passing of the award and in the instant cases, such applications having admittedly been filed within 6 (six) months from the date of passing of the award, the same cannot be held to be barred by time u/s 18 of the Act.

It appears from the aforesaid notice dated 22nd February, 1995 (Exhibit 3) issued from the Office of the Collector that the Respondents were informed to attend the Office of the Collector for receiving the amount awarded. Except giving such information, no other particulars relating to the quantum of compensation awarded and details thereof has been furnished to the land owners/Respondents, so as to make up their mind about the requirement of filing an application u/s 18 of the Act. As observed by the Apex Court in Bhagwan Das (supra), a notice given to the land owners or any person interested can be treated to a notice u/s 12(2) of the Act, provided it contains the detailed particulars of the compensation awarded by the Collector with all relevant particulars, which will enable the land owners or the person interested to decide whether he should seek reference or not. As discussed above, no particulars about the award passed was furnished to the land owners/Respondents by the aforesaid document being Exhibit-3 dated 22nd February, 1995. That being the position, the said document cannot be treated as notice u/s 12(2) of the Act and as such the requirement of filing the application u/s 18 of the Act seeking reference within 6 (six) weeks, as provided in Clause (b) of the proviso does not apply in the cases in hand. The land owners/persons interested, therefore, have to file the application seeking reference within 6 (six) months from the date of the Collector''s award. There is no dispute that such applications, u/s 18 of the Act, were filed by the land owners within 6 (six) months from the date of passing of the award by the Collector. That being the position, it cannot be held that the applications filed by the Respondents seeking reference of the dispute u/s 18 of the Act are barred by time.

The next question, which requires determination, is whether the land owners/Respondents would be entitled further compensation u/s 23(1A) of the Act from the date of taking over the possession till the date of passing of the award u/s 11 of the Act. As noticed above, the possession of the land acquired was taken over much prior to the issuance of the preliminary notification u/s 4(1) of the Act.

Section 23(1A) of the Act provides that in addition to the market value of the land, ascertained under Sub-section (1) of Section 23, the court shall in every case award an amount calculated at the rate of twelve per centum on such market value for the period commencing on and from the date of the publication of the notification u/s 4(1), in respect of such land, to the date of the award of the Collector or the date of taking over possession of the land, whichever is earlier.

Section 23(1A) of the Act, therefore, envisages payment of the further compensation @ 12% per annum on the market value of the land from the date of issuance of the notification u/s 4(1) of the Act till the date of passing of the award of the Collector or the date of taking over possession of the land, whichever is earlier. The scheme of the Act envisage taking over the possession of the land after passing of the award, which is the normal rule. The Collector, however, in exceptional circumstances, can take over the possession of the land even before passing of an award as envisaged u/s 17 of the said Act. The Act does not provide for taking over the possession of the land sought to be acquired at any time prior to issuance of the preliminary notification u/s 4(1) of the Act, not even invoking the power u/s 17 of the Act and hence, if the possession of the land, proposed to be acquired, is taken over by the Collector, even before issuance of the notification u/s 4(1) of the Act, taking over of such possession may be illegal and not in terms of the provisions of the Act, as the title over the property remains with the land owners. For that purpose the land owner may claim the damage or compensation for that period by initiating appropriate proceeding in the appropriate court of law. Since Section 23(1A) of the Act clearly provides payment of further compensation from the date of issuance of the notification u/s 4(1) of the Act till the date of passing of the award and in case of taking over the advance possession as stipulated u/s 17 of the Act, to the date of taking over such possession, the land owners would not be entitled to such amount u/s 23(1A) of the Act for any period prior to issuance of the notification u/s 4(1) of the Act. The Apex Court in R.L. Jain (D) by Lrs. Vs. DDA and Others, has held that persons interested are not entitled to further compensation u/s 23(1A) as well as interest u/s 34 for the period of possession prior to issuance of notification u/s 4(1) of the Act.

The reference court while directing payment of further compensation, u/s 23(1A) of the Act, from the date of taking over possession till the date of passing of the award, had assumed that such possession was taken over u/s 17 of the Act, which, however, is not factually correct, since the possession of the land was never taken over u/s 17 of the Act after issuance of the notification u/s 4(1) of the Act.

In view of the above, the land owners would be entitled to further compensation at the rate of twelve per centum per annum, u/s 23(1A) of the Act, from the date of issuance of the notification u/s 4(1) of the Act till the date of passing of the award and not from the date of taking over the possession, which was prior to issuance of the notification u/s 4(1) of the Act.

Relating to the claim of the interest u/s 34 of the Act, as noticed above, the possession of the land was taken over prior to issuance of the notification u/s 4(1) of the Act. The Act does not envisage taking over the possession of any land sought to be acquired prior to issuance of the preliminary notification u/s 4(1) of the Act. As held above, taking over such possession, prior to issuance of such preliminary notification may be illegal for which the land owners or person interested may initiate appropriate proceeding before the appropriate court of law.

Section 34 of the Act requires payment of interest for the first year @ 9% and thereafter @ 15% per annum provided the compensation or any part thereof awarded is not paid or deposited on or before taking over the possession of the land. As discussed above, general rule under the Act is to take over the possession of the land after passing of the award u/s 11 of the Act. In the instant case, the possession was not taken over by invoking the power conferred u/s 17 of the Act. The earliest date on which the possession, in these cases, deemed to have been taken over under the Act would be the date of passing of the award. That being the position, the Respondents/land owners would be entitled to interest u/s 34 of the Act from the date of passing of the award to the date of actual payment and not from the date of taking over the possession, which was much prior to issuance of the notification u/s 4(1) of the Act, as has been awarded by the reference court.

The Appellants shall, therefore, pay the further compensation @ 12% per annum u/s 23(1A) of the Act to the Respondents/land owners from the date of issuance of the notification u/s 4(1) of the Act to the date of passing of the final award and interest u/s 34 of the Act from the date of passing of the award till the date of payment of the awarded amount. It is, however, made clear that since the Collector, in some of the land acquisition proceedings, have awarded compensation u/s 23(1A) for a period of one year though the Respondents are not found to be entitled to and since the court cannot reduce the compensation awarded by the Collector, there cannot be any recovery of the said amount payable by the Appellants in view of this judgment and order. It would also not preclude the Respondents from initiating any proceeding against the Appellants for assessment and recovery of rental or other compensation for the period for which the possession of the land was taken over prior to issuance of the notification u/s 4(1) of the Act, if permissible under the law.

The appeals are accordingly allowed to the extent indicated above. The cross-objections stand dismissed. No costs.