whether a post-acquisition allottee of land is necessary or proper party or has any locus to be heard in the matter of determination of compensation under the scheme of the Land Acquisition Act, 1894 (the Act). If not, whether the impugned order permitting additional evidence and directing remand is sustainable.

REPORTABLE

IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOs. 1587-1636 OF 2017

SATISH KUMAR GUPTA ETC. ETC. …APPELLANTS

VERSUS

STATE OF HARYANA & ORS. ETC. …RESPONDENTS
WITH

CIVIL APPEAL NOs.1637 OF 2017, 1638-1653 OF 2017, 1655-1658 OF 2017, 1659-
1663 OF 2017, 1664 OF 2017, 1665-1669 OF 2017, 1670-1675 OF 2017, 1677-
1691OF 2017, 1692 OF 2017, 1693 of 2017, 1694 of 2017, 1695 OF 2017, 1696
OF 2017, 1699-1701 OF 2017, 1702 OF 2017, 1703-1780 OF 2017, 1783-1852 OF
2017, 1853-1927 OF 2017, 1930-2003 OF 2017, 2004-2058 OF 2017, 2059-2111 OF
2017, 2112-2114 OF 2017, 2117-2118 OF 2017, 2123-2126 OF 2017, 2127-2128
OF 2017, 2129-2132 OF 2017, 2133-2138 OF 2017, 2139-2143 OF 2017, 2144-
2145 OF 2017, 2146-2200 OF 2017, 2201-2203 of 2017, 2204 of 2017, 2205-
2206 OF 2017, 2207-2214 OF 2017, 2215-2219 OF 2017, 2220 OF 2017, 2221-2223
OF 2017, 2224 OF 2017, 2226-2227 OF 2017, 2228 OF 2017, 2232-2246 OF 2017
AND 2249-2279 OF 2017.
J U D G M E N T
ADARSH KUMAR GOEL, J.
1. These appeals have been preferred against judgment and order dated
06th October, 2015 passed by the High Court of Punjab and Haryana at
Chandigarh in R.F. A. Nos.4316 of 2010 etc. etc.
2. Question for consideration is whether a post-acquisition allottee of
land is necessary or proper party or has any locus to be heard in the
matter of determination of compensation under the scheme of the Land
Acquisition Act, 1894 (the Act). If not, whether the impugned order
permitting additional evidence and directing remand is sustainable.
3. Facts giving rise to the question may be briefly noted. Huge chunks
of land were acquired by the State of Haryana in different phases for the
public purpose of setting-up Industrial Model Township by the Haryana State
Industrial Development Corporation (HSIDC) in Gurgaon District in Haryana.
Substantial part of the acquired land was allotted by the HSIDC to Maruti
Suzuki India Limited (MSIL). One of the clauses in the Conveyance Deed
executed in favour of the allottee provided that if compensation was
enhanced, the allottee shall be liable to pay additional price on that
basis. In HSIDC v. Pran Sukh[1], issue of compensation for land acquired
in Phase I was decided by this Court. Review Petitions against the said
judgment were dealt with in HSIDC v. Mawasi[2] and HSIDC v. Pran Sukh[3].
Matter of determining compensation in respect of Phase II and Phase III
came-up for consideration in HSIDC v. Udal[4]. As noticed in judgment of
this Court in Udal (supra), the Reference Court awarded compensation in the
light of compensation determined in the judgment of this Court in Pran Sukh
(supra) and other awards relating to land acquired for Phase III. Against
the decision of the Reference Court, the land owners as well as the HSIDC
filed appeals under Section 54 of the Act. The High Court assessed the
compensation based on judgment of this Court in Pran Sukh (supra).
Reference to paras 29 to 33 of the judgment of this Court Udal (supra)
shows that after referring to the plea of the HSIDC that the annual
increase of 12% for the time gap was erroneous in view of ONGC v.
Rameshbhai Jivanbhai Patel[5] and Valliyammal v. Special Tehsildar (LA)[6],
this Court found merit in the arguments of the land owners that an
important piece of evidence was not taken into account which necessitated
remand. The matter was remanded to the High Court for fresh disposal and
it was also observed that MSIL was free to file an appropriate application
for its impleadment or for leave to act as intervenor.
4. Thereafter, the matter was dealt with by the High Court in the
impugned judgment. The High Court held that the allottee had a right to be
impleaded as a party for the following reasons:
a) The State or the local authority for whose benefit the land is
acquired may not lead proper evidence or advance effective arguments.
b) A clause in the deed of allotment in favour of the allottee
provides for payment of additional price as a consequence of enhancement of
compensation.
c) As a result of enhancement of compensation by the Reference
Court, the company in question was required to pay about Rs.900 crores.
d) Under Order 1 Rule 10(2) CPC the Court can add or delete a
party at any stage.
e) Section 50 of the Act provides a right to a local authority or
a company for whose benefit the land is acquired to be represented before
the Collector or the Court in the process of determination of compensation.

f) The principle behind giving the right of representation to a local
authority or a company for whose benefit the land is acquired can also be
applied to any person who is liable to pay the enhanced compensation
treating such person to be the “person interested” under Section 3(b) of
the Act.
5. After permitting the allottee to be impleaded as a party, the High
Court also allowed application to lead additional evidence on the ground
that the acquiring authority did not defend the case properly. Similar
application filed by the HSIDC to lead additional evidence was also allowed
and, thereafter, on considering the additional evidence it was observed
that it was not possible for the High Court to assess the compensation as
there was no site plan showing the location of the transactions relied. It
was also considered necessary to give an opportunity to MSIL, who was
impleaded for the first time. On that basis the matter was remanded to the
Reference Court for fresh decision.
6. Aggrieved by the order of the High Court these appeals have been
preferred. Contentions of the appellants are as follows:
i) The post-acquisition allottee had no right to be heard in the matter
of compensation. Reliance has been placed on Hindu Kanya Maha Vidyalaya,
Jind and anr. v. Municipal Committee, Jind and ors.[7]; Haryana State
Industrial Development Corporation v. Pran Sukh and ors. (supra) and;
Peerappa Hanmantha Harijan (Dead) by legal representatives and ors. v.
State of Karnataka and anr.[8]
ii) Applications for impleadment have been filed by MSIL 12 years after the
acquisition and applications for additional evidence were also filed after
a long delay and for the first time after remand by this Court, which could
not be considered within the scope of Order XLI Rule 27 of CPC.
(iii) Application for additional evidence was rejected by this Court in the
earlier round. The remand by this Court was limited to the question
whether there was a need for further enhancement in the light of evidence
which was not earlier considered.
7. On the other hand, learned counsel for the MSIL as well as the HSIDC
and other allottees have supported the impugned judgment. They submit that
since allottees have to pay the enhanced compensation, they ought to be
treated as “person interested” under Section 3 (b) of the Act. Reliance
has been placed on judgments of this Court in Himalayan Tiles and Marble
(P) Ltd. v. Francis Victor Coutinho (Dead) by Lrs. [9]; Santosh Kumar
and ors. v. Central Warehousing Corporation and anr.[10]; Neyvely Lignite
Corporation Ltd. v. Special Tahsildar (Land Acquisition) Neyvely and
Ors.[11] and; U.P. Awas Evam Vikas Parishad v. Gyan Devi (Dead) by Lrs.
and Ors. [12].
8. We have given our due consideration to the rival submissions.
9. To determine the question whether the post-acquisition allottee of
land is necessary or proper party or has any locus to be heard in the
matter of determination of compensation, we may refer to the scheme of the
Act. The acquisition may either be for a “public purpose” as defined under
Section 3(f) or for a company under Part-VII of the Act. If the
acquisition is for a public purpose (as the present case), the land vests
in the State after the Collector makes an award and the possession is
taken. Till the award is made, no person other than State comes into the
picture. Once the land vests in the State, the acquisition is complete.
Any transferee from the State is not concerned with the process of
acquisition. The State may transfer the land by public auction or by
allotment at any price with which the person whose land is acquired has no
concern. The mere fact that the Government chooses to determine the
allotment price with reference to compensation price determined by the
Court does not provide any locus to an allottee to contest the claim for
enhancement of compensation.
10. This legal position is well settled on principle as well as the
precedent. In Hindu Kanya Maha Vidyalaya (supra) it was observed:

“3. … … …Indisputably the land in dispute was not acquired for the purpose
of appellants instead the land was acquired for the Municipal Committee for
the purpose of developing its Scheme No. 5. After the declaration of award
Municipal Committee took possession of the land and thereafter transferred
a portion of the same to the appellants under an agreement. In these
circumstances the ratio laid down by this Court in Himalayan Tiles & Marble
(P) Ltd. v. Francis Victor Countinho [(1980) 3 SCC 223] does not apply as
the appellants are not interested persons and they have no right to
question the award. … … …”

11. Again, in Peerappa Hanmantha (supra) inter alia the following
questions were framed for consideration.
“30.1. (i) Whether the allottee Company (M/s. Ultra Tech Cement Ltd.) is
either a beneficiary or interested person entitled for hearing before
determination of the market value to award just and reasonable compensation
in respect of the acquired land of the appellants either before the Deputy
Commissioner or Reference Court?

(ii) Whether the writ petition filed by the allottee Company before the
High Court is maintainable in law?

(iii) Whether the order of remand allowing the writ petition of the
allottee Company to the Reference Court is legal and valid?”
12. The above questions were answered as follows:

“63. In view of the foregoing reasons recorded by us on the basis of the
acquisition notifications issued by the State Government under the
statutory provisions of the KIAD Act and therefore, we have to answer
Points (i), (ii) and (iii) in favour of the landowners holding that the
Company is neither the beneficiary nor interested person of the acquired
land, hence, it has no right to participate in the award proceedings for
determination of the market value and award the compensation amount of the
acquired land of the appellants. Hence, the writ petition filed by the
Company questioning the correctness of the award passed by the Reference
Court which is affirmed by the High Court is not at all maintainable in
law. On this ground itself, the writ petition filed by the Company should
have been rejected by the High Court, instead it has allowed and remanded
the case to the Reference Court for reconsideration of the claims after
affording opportunity to the Company, which order suffers from error in law
and therefore, the same is liable to be set aside.”

13. Judgments in U.P. Awas Evam Vikas Parishad (supra), Himalayan Tiles
(supra) and P. Narayanappa and anr. v. State of Karnataka and ors.[13] as
mentioned in para 61 of the judgment in Peerappa Hanmantha (supra) were
held to be not applicable as the same applied only when the acquisition is
for a company or for the beneficiary of the acquisition as mentioned in the
notification for acquisition itself. This is clear from the following:

“61. Further, both the learned Senior Counsel on behalf of KIADB and the
Company have placed reliance on various decisions rendered by this Court in
support of their above respective legal submissions that the Company is an
interested person and, therefore, it has got right to participate in the
proceedings before the Reference Court for determination of compensation
before passing the award either by the Land Acquisition Officer or the
Deputy Commissioner or the Reference Court at the instance of the owner or
any other interested person. These include judgments rendered by this Court
in U.P. Awas Evam Vikas Parishad v. Gyan Devi, Himalayan Tiles and Marble
(P) Ltd. v. Francis Victor Coutinho and P. Narayanappa v. State of
Karnataka and other decisions which are not required to be mentioned in
this judgment as they are all reiteration of the law laid down in the above
cases.

62. The reliance placed on the various decisions of this Court by both the
learned Senior Counsel on behalf of KIADB and the Company, is misplaced as
none of the said judgments relied upon are applicable to the fact situation
in the present case for the reason that those cases dealt with reference to
the acquisition of land under the provisions of the LA Act, either in
favour of the company or development authorities, whereas in the case on
hand, the acquisition proceedings have been initiated under the KIAD Act
for industrial development by KIADB. Further, the original acquisition
record in respect of the acquired land involved in the proceedings by the
learned Standing Counsel on behalf of the State of Karnataka as per our
directions issued vide our orders dated 17-11-2014[14] and 24-3-2015[15],
do not disclose the fact that the acquisition of lands covered in the
acquisition notifications are in favour of the Company. Thus, the
acquisition of land in favour of KIADB is abundantly clear from the
preliminary and final notifications issued by the State Government and
thereafter following the procedure under sub-sections (6) and (7) of
Section 28 of the KIAD Act, it took possession of the acquired land from
the owners who were in possession of the same and was transferred in favour
of KIADB for its disposal for the purpose for which lands were acquired as
provided under Section 32(2) of the KIAD Act read with the Regulations
referred to supra framed by KIADB under Section 41(2)(b) of the KIAD Act.
Therefore, the reliance placed upon the judgments of this Court by the
learned Senior Counsel on behalf of the Company and KIADB, are wholly
inapplicable to the fact situation and do not support the case of the
Company.”
14. We are in respectful agreement with the above view in Hindu Kanya
Maha Vidyalaya (supra) and Peerappa Hanmantha (supra). No contrary view of
this Court has been brought to our notice. The judgments relied upon by
the respondents are distinguishable as already held by this Court.

15. In Himalayan Tiles (supra) the acquisition was under Part-VII of the
Act. In Santosh Kumar (supra) the question was whether award of the
Collector could be challenged, to which this Court answered in the negative
except on the ground of fraud, corruption or collusion. In Neyvely Lignite
(supra) again the acquisition was under Part-VII of the Act and in that
context this Court held that the expression “person interested” could
include a company or local authority for whose benefit the land was
acquired. The post-acquisition allottee cannot by any stretch of
imagination be treated at par with beneficiary for whom the land was
acquired. In U.P. Awas Evam Vikas Parishad (supra), the matter dealt with
was in the context of statutory authority for whom the land was acquired.
Delhi Development Authority v. Bhola Nath Sharma (dead) by Lrs. and
ors.[16] was a case in the context of beneficiary for whom the land was
acquired.

16. The only other justification in the impugned judgment which has been
relied upon by the respondents is lack of sincerity on the part of the
State authority for whose benefit the acquisition has been made viz. HSIDC,
which by itself cannot be a valid ground to permit post-acquisition
allottee to be treated as a necessary or proper authority under Order I
Rule 10 of CPC to proceedings for determination of compensation. The view
taken in the impugned judgment cannot be sustained on any principle or
precedent.

17. We may now refer to an order of this Court dated 15th
July, 2004 which has been relied upon in the impugned judgment in para 31.
There is no consideration of the principle of law and thus, the said
order without there being contest on the principle of law could not be
treated as a precedent for deciding the legal issue at hand.

18. Accordingly, we hold that the post-acquisition allottee has no locus
to be heard in the matter and is neither a necessary nor a proper party.

19. The other part of the impugned order permitting additional evidence
and remanding the case for fresh decision is uncalled for. No case was
made out for permitting additional evidence on settled principles under
Order XLI Rule 27 of CPC. The provision is reproduced below:-

“27. Production of additional evidence in Appellate Court.- (1) The parties
to an appeal shall not be entitled to produce additional evidence, whether
oral or documentary, in the Appellate Court. But if –

(a) the court from whose decree the appeal is preferred has refused
to admit evidence which ought to have been admitted, or

(aa) the party seeking to produce additional evidence, establishes that
notwithstanding the exercise of due diligence, such evidence was not within
his knowledge or could not, after the exercise of due diligence, be
produced by him at the time when the decree appealed against was passed, or

(b) the Appellate Court requires any document to be produced or any witness
to be examined to enable it to pronounce judgment, or for any other
substantial cause,

The Appellate Court may allow such evidence or document to be produced, or
witness to be examined.

(2) Wherever additional evidence is allowed to be produced by an Appellate
Court, the Court shall record the reason for its admission.”
20. It is clear that neither the Trial Court has refused to receive the
evidence nor it could be said that the evidence sought to be adduced was
not available despite the exercise of due diligence nor it could be held to
necessary to pronounce the judgment. Additional evidence cannot be
permitted to fill-in the lacunae or to patch-up the weak points in the
case[17]. There was no ground for remand in these circumstances.

21. We may also refer to the argument that this Court, while remanding
the matter in the earlier round, had given liberty to the MSIL to file an
application for impleadment or to act as an intervenor which implied that
such application was to be accepted. We do not find any merit in this
contention also. It cannot be held that any right was crystalised by the
said observation and such prayer had to be considered according to law. We
have already held that the post-acquisition allottee had no right in the
matter.

22. For the above reasons, we allow these appeals and set aside the
impugned order and remand the matter to the High Court once again for fresh
decision in accordance with law. The parties are directed to appear before
the High Court on 27th March, 2017.

…………..…………………………….J.
[ ADARSH KUMAR GOEL ]

.….……………………..……………..J.
[ UDAY UMESH LALIT ]

NEW DELHI;
FEBRUARY 21, 2017.

———————–
[1]

[2] (2010) 11 SCC 175
[3]
[4] (2012) 7 SCC 200
[5]
[6] (2012) 7 SCC 721
[7]
[8] (2013) 14 SCC 506
[9]
[10] (2008) 14 SCC 745
[11]
[12] (2011) 8 SCC 91
[13]
[14] 1988 (Supp) SCC 719
[15]
[16] (2015) 10 SCC 469
[17]
[18] (1980) 3 SCC 223
[19]
[20] (1986) 2 SCC 343
[21]
[22] (1995) 1 SCC 221
[23]
[24] (1995) 2 SCC 326
[25]
[26] (2006) 7 SCC 578
[27]
[28] Peerappa Hanmantha Harijan v. State of Karnataka, SLP(C)No.
19819 of 2013, order dated 17-11-2014 (SC), wherein it was directed:
“Issue notice to the State Government. The learned counsel for the
petitioners to take out notice to the learned Standing Counsel appearing
for the State Government. Dasti, in addition, is also permitted. Mr. V.N.
Raghupathy, learned counsel accepts notice for the State of Karnataka and
Mr. Nishanth Patil, learned counsel accepts notice for Karnataka Industrial
Area Development Board (for short ‘KIADB’). The learned counsel appearing
for the State Governument and the learned counsel appearing for KIADB are
directed to produce the relevant records in respect of the proceedings
relating to land acquisition involved in these matters. There shall be
stay of the effect and operation of the impugned order during the pendency
of these petitions. List the matters after four weeks. In the meanwhile,
all the respondents are at liberty to file written statements, if any.”

[29]
[30] Peerappa Hanmantha Harijan v. State of Karnataka, SLP(C)No.
19819 of 2013, order dated 24-3-2015(SC), wherein it was directed:
“Heard Ms. Kiran Suri, learned Senior Counsel for the petitioners in
SLPS(C)Nos. 31624-25 of 2014 in part. List all the matters as part for
further hearing. Vide order dated 17-11-2014, learned counsel for the
State as well as the learned counsel for KIADB were directed to produce the
relevant records in respect of the proceedings relating to land acquisition
involved in these matters, record as well as the records relating to
allotment of land. However, as per office records, nothing has been
produced so far. In this view of the matter, the learned counsel for the
State as well as the learned counsel for KIADB are directed to comply with
the order dated 17-11-2014 and produce the relevant records in respect of
the proceedings relating to land acquisition and the allotment of land
involved in these matters before the next date of hearing. List the
matters on 15-4-2015.”
[31]
[32] (2011) 2 SCC 54
[33]
[34] N. Kamalam v. Ayyaswami (2001) 7 SCC 503: para 19

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