Full Judgment Text
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IN THE HIGH COURT OF KARNATAKA
KALABURAGI BENCH
ND
DATED THIS THE 2 DAY OF APRIL, 2026
BEFORE
THE HON'BLE MR. JUSTICE SURAJ GOVINDARAJ
WRIT PETITION NO. 201709 OF 2019 (LA-RES)
BETWEEN:
THE EXECUTIVE ENGINEER,
BNT PROJECT, HEBBAL VILLAGE – 585 312.
TALUKA CHITTAPUR, DIST. KALABURAGI.
…PETITIONER
(BY SRI. SANJEEVKUMAR C.PATIL, ADVOCATE)
AND:
1.
THE STATE THROUGH ASSISTANT COMMISSIONER &
SPECIAL LAND ACQUISITION OFFICER,
M & MIP, KALABURAGI – 585 102.
2. THE DEPUTY COMMISSIONER,
MINI VIDHANA SOUDHA, KALABURAGI – 585 102.
3. AMRUTH RAO S/O. GUNDAPPA PATIL
BY HIS L.R.’S
I) GUNDERAO S/O. AMRUTHRAO PATIL
AGE: 50 YEARS, OCC: AGRICULTURE,
R/O. SAVATHKHED VILLAGE,
TQ. CHITTAPUR, DIST. KALABURAGI – 585 211.
…RESPONDENTS
(BY SRI. SHASHIKIRAN SHETTY, AG
A/W. MALHAR RAO, AAG A/W.
SMT. MAYA T.R., HCGP FOR R1 AND R2;
SRI. A.M.BIRADAR, ADVOCATE FOR R3(I))
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227
OF THE CONSTITUTION OF INDIA, PRAYING TO ISSUE A WRIT OF
CERTIORARI QUASHING THE JUDGMENT AND AWARD DATED
11.10.2017 PASSED BY THE HON’BLE I ADDITIONAL DISTRICT
Digitally signed
by VARSHA N
RASALKAR
Location: HIGH
COURT OF
KARNATAKA
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JUDGE KALABURAGI, PASSED IN LACA NO.437/2017 PRODUCED AT
ANNEXURE-A, IN THE INTEREST OF JUSTICE AND EQUITY AND ETC.
THIS PETITION, COMING ON FOR FURTHER HEARING, THIS
DAY, ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE SURAJ GOVINDARAJ
ORAL ORDER
1. The petitioner, Karnataka Niravari Nigam Limited
who is the beneficiary of the acquisition, is before
this Court seeking for the following reliefs:
I) Issue a writ of certiorari quashing the judgment
and award dated 11.10.2017 passed by the
Hon’ble I Addl. District Judge, Kalaburagi passed
in LACA No.437/2017 produced at Annexure-A.
II) To allow this writ petition with costs and grant
such other relief / reliefs as this Hon’ble Court
may deem fit in the facts and circumstances of
the case as stated above with costs in the
interest of justice and equity.
2. Having regard to the admitted position that the
acquisition proceedings have remained pending for
an inordinately long period of time, and further
taking into consideration that the land losers have
not received the compensation amounts within a
reasonable or statutorily contemplated timeframe,
this Court found it necessary to consider appropriate
measures to ensure expeditious and effective
resolution of the disputes. It is also of relevance that
the land losers have been constrained to initiate
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proceedings for enforcement of the decrees passed
against the beneficiary of the acquisition, which itself
indicates the protracted nature of the litigation and
the absence of finality.
3. This Court being conscious of the fact that continued
pendency of such proceedings would result in
manifest prejudice to all stakeholders. On the one
hand, the land losers would be deprived of the
immediate and beneficial enjoyment of the
compensation amounts awarded to them, thereby
defeating the very purpose of acquisition
jurisprudence which mandates timely recompense for
compulsory deprivation of property. On the other
hand, the beneficiary of the acquisition, as well as
the State Government, would be exposed to an ever-
increasing financial burden on account of the accrual
of statutory interest, additional interest, and other
consequential liabilities during the pendency of the
proceedings.
4. In addition, multiplicity of proceedings, including
execution proceedings and ancillary litigations, would
further complicate the matter and consume valuable
judicial time. In such circumstances, this Court was
of the considered opinion that an adversarial
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adjudicatory process may not necessarily subserve
the ends of justice in the most efficient manner.
5. Accordingly, in exercise of its powers to adopt
alternative dispute resolution mechanisms, and
having regard to the principles underlying Section 89
of the Code of Civil Procedure, 1908, this Court
suggested to the learned counsel appearing for all
parties as to whether they would be agreeable to a
reference of the disputes to mediation, with a view to
facilitating a comprehensive, mutually acceptable,
and time-bound settlement, thereby bringing a
quietus to the long-pending disputes between the
parties.
6. Pursuant to the aforesaid suggestion, the learned
Advocate General, upon obtaining necessary
instructions from the State Government as well as
the concerned departments and instrumentalities,
fairly submitted that the State would be agreeable to
exploring a resolution of the disputes through the
process of mediation. The said submission reflects a
pragmatic and constructive approach on the part of
the State in addressing long-pending acquisition-
related disputes.
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7. Similarly, the learned counsels appearing for the land
losers, led by Sri Harshavardhan R. Malipatil, also
expressed their willingness to participate in the
mediation process, recognising that such a
mechanism may enable an expeditious realisation of
compensation and avoid further delay inherent in
continued litigation.
8. In view of the consensus that emerged between the
parties, and bearing in mind the nature of the
disputes as well as the potential for an equitable and
negotiated settlement, this Court deemed it
appropriate to refer the matter to mediation.
Accordingly, the disputes were referred to mediation
under the aegis of Hon’ble Sri A. V. Chandrashekhar,
former Judge of this Court, who was requested to act
as the Mediator.
9. Learned counsel appearing for all the parties submit
that, pursuant to the reference made by this Court,
several rounds of mediation proceedings were
conducted under the guidance of the learned
Mediator. It is submitted that multiple interactive
sessions were held, both collectively and separately,
involving the representatives of the State
Government, the beneficiary of the acquisition, and
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the land losers. Parallel deliberations were also
undertaken at the level of the concerned
governmental authorities to examine the feasibility of
settlement and to obtain necessary approvals.
10. It is further submitted that, as a result of sustained
negotiations and constructive engagement between
the parties, they have been able to arrive at an
amicable and mutually acceptable settlement,
resolving the disputes which formed the subject
matter of the present proceedings. The terms of such
settlement have been reduced into writing and duly
recorded by the learned Mediator in the form of a
Mediation Agreement.
11. The learned counsel submit that the said Mediation
Agreement has been signed by the parties and their
respective representatives, and has been placed on
record before this Court. It is also submitted that the
settlement comprehensively addresses all
outstanding issues between the parties, including the
payment of compensation, interest components,
timelines for disbursement, and the manner of
closure of pending proceedings.
12. In view of the above, the parties jointly requested
this Court to take the Mediation Agreement on record
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and to pass appropriate orders in terms thereof, so
as to give finality to the disputes between the
parties.
13. The Mediation Agreement, as placed on record, reads
as under:
“MEDIATION AGREEMENT
Thorough discussions were held in the
presence of the Learned Mediator, Justice A.V
Chandrashekar (Retired), the Managing Director
of Karnataka Neeravari Nigam (Hereinafter
"KNNL"), the Learned Advocate General,
Karnataka, Additional Advocate General,
Kalaburagi, the Learned Advocates appearing for
the parties, and the authorized representatives of
KNNL.
The parties have agreed as follows:
The present writ petition is one of several land
acquisition matters pertaining to various irrigation
projects which are being undertaken and
managed by KNNL. By order Dtd:07-07-2025, the
Hon'ble High Court referred the matters for
mediation and connected cases. The present
compromise has been duly approved by the State
Government of Karnataka on 25-02-2026 relating
to the land acquisition for the Bennethora project,
considering the various factors like the decision of
the Hon'ble Supreme Court and also settlement in
earlier mediation MSA No.200061 of 2017 and
other connected matter and deliberations between
the parties. The parties have voluntarily agreed to
settle the above matter on the following terms:
(a) The market value of the land acquired is
calculation and arrived at Rs.61,584 (in
words Rupees: Sixty One Thousand Five
Hundred and Eighty Four only) per acre.
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(b) The Respondent/s (Claimant/s) is/are
entitled for all statutory benefits under
Land Acquisition Act, except for the period
of delay in filing the Appeal before the First
Appellate Court.
(c) No interest is payable to the Respondent/s
(Claimant/s) for the period of delay in filing
the Appeal before the First Appellate Court.
(d) The Respondent/s (Claimant/s) agree that
they will give up statutory interest for a
period of two and half years.
(e) It is agreed to between the parties that the
calculation of interest is made up to
14.03.2026.
(f) It is agreed to between the parties that, in
case the agreed amount is not paid within
four months from the signing of this
agreement, KNNL will not be entitled for
exemption of payment of interest for a
period of two and half years as outlined in
clause (d).
(g) The Respondent/s (Claimant/s) has/have
understood and agreed that the payment of
amounts quantified in the present
agreement would be made through the P.D
account of KNNL of Chief Accounts Officer,
KNNL, Dharwad. (Heard of Account "8443-
00-106") as outlined in G.O. No. AE13 TAR
2023 dated 27.09.2024;
(h) The Respondent/s (Claimant/s) agree that
the present agreement would be a full and
final settlement of their claims and they
would not be entitled to any differential
interest except in accordance with the
terms of this agreement;
(i) Respondent/s (Claimant/s) has/have
agreed to give an undertaking in writing
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about the genuineness of their claim and
undertake to furnish copy of the Passbook
and Aadhar Card immediately upon signing
of the agreement;
(j) The Respondent/s (Claimant/s) agree that
the present agreement would be a full and
final settlement of their claims and they
and/or their legal heirs undertake to not
agitate any further claims in this regard, in
the future;
(k) The Respondent/s (Claimant/s) agree to
withdraw all pending Execution Petition(s)
in terms of this agreement;
(l) KNNL would not be bound to pay any
further compensation or claim to a third
party, should any dispute arise between the
Respondent/s (Claimant/s) and such
person, in respect of ownership and claim
of the acquired land;
(m) KNNL has agreed to pay the costs to the
Respondent/s (Claimant/s) which is
equivalent to the Court fee paid by the
Respondent/s. Consequently, KNNL is
entitled for return of Court fee from Hon'ble
Court, as per law;
(n) KNNL has undertaken that the payment of
agreed amount will be deposited directly to
the account of the Respondent/s
(Claimant/s) through the P.D. account of
KNNL of the Chief Accounts Officer KNNL,
Dharwad. (Head of Account "8443-00-106"
as outlined in G.O No. AE 13 TAR 2023
Dtd:27-09-2024;
(o) The present settlement shall not be
considered either as a precedent or a policy
decision or a proposal binding in KNNL for
cases, other than the present matter
referred to Mediation.
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The parties to this agreement have entered into
this compromise voluntarily, on their own volition,
without any coercion of misrepresentation and the
contents of this agreement have been explained
to and understood by the Respondent/s
(Claimant/s) in vernacular as well.”
14. The Mediation Agreement has been duly executed by
the competent representatives of the parties. On
behalf of the beneficiary, it is signed by the Executive
Engineer, Karnataka Neeravari Nigam Limited
(KNNL). On behalf of the State authorities, it bears
the signatures of the Special Land Acquisition Officer
and the Deputy Commissioner, both of whom have
been duly identified by the learned High Court
Government Pleader, who has also appended her
signature in token of such identification and
authentication.
15. Insofar as the Claimant/land loser is concerned,
respondent Nos.3(i) has affixed his signature. The
said party has been duly identified by his learned
counsel, who has also signed the Mediation
Agreement in confirmation thereof.
16. Learned counsel appearing for the petitioner, as well
as learned counsel appearing for the
respondents/claimants, jointly submit that the terms
and conditions recorded in the Mediation Agreement
fully and finally resolve all disputes inter se the
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parties. All parties undertake to abide by and
perform their respective obligations strictly in
accordance with the terms of the said Mediation
Agreement, without demur or delay.
17. Accordingly, the following directions are issued
governing the mode and manner of disbursement:
a. In cases involving a single claimant, the agreed
amount shall be disbursed to the individual
bank account of such claimant;
b. In cases involving multiple claimants, the
claimants shall open a joint bank account in the
names of all such claimants;
c. The requisite bank account particulars,
including all details necessary for electronic
transfer through RTGS/NEFT, shall be furnished
to the Special Land Acquisition Officer within a
period of 21 (Twenty one) days from the date
of receipt of certified copy of this order.
18. In the event the claimants (in cases of multiple
claimants) are unable to open a joint bank account
within the aforesaid period:
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a. They shall, within a further period of 7 (seven)
days thereafter, furnish a duly sworn affidavit
along with an indemnity undertaking;
b. The affidavit shall clearly specify:
i. the agreed apportionment of the settlement
amount; and
ii. the individual bank account details of each
claimant;
c. The affidavit shall further stipulate that any
disbursement made in accordance with such
particulars shall constitute full and final
discharge of all liabilities of the respondents
towards the claimants and any person claiming
through or under them.
19. Upon receipt of:
a. the bank account particulars under paragraph
17; or
b. the affidavit and undertaking under paragraph
18;
the beneficiary, namely Karnataka Neeravari
Nigam Limited, shall process and disburse the
agreed amounts within a period of 120 (one
hundred and twenty) days from the date of
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such receipt, by way of electronic transfer to
the designated account(s).
20. Upon such payment being made within the stipulated
period, Karnataka Neeravari Nigam Limited shall
stand fully and finally discharged of all obligations
under the Mediation Agreement.
21. In the event of failure to effect payment within the
aforesaid period of 120 days:
a. The claimants shall be at liberty to initiate
execution proceedings on the basis of this order
read with the Mediation Agreement;
b. Such right of execution shall be without
prejudice to the claimants’ entitlement to
statutory and/or agreed interest, which shall
continue to accrue until the date of actual
realisation.
22. Taking note of the submission of the learned counsel
for the respondents/beneficiary that delay on the
part of the claimants in furnishing requisite
particulars should not result in avoidable financial
exposure. It is directed that:
a. In the event the claimants fail to furnish:
i. bank account particulars within 21 days
(paragraph 17), or
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ii. affidavit and undertaking within the extended 7
days (paragraph 18),or
b. In the event payment is not effected within 120
days from the date of furnishing such
particulars or affidavit, the beneficiary shall be
at liberty to deposit the agreed amount within a
further period of 15 (fifteen) days:
i. before the Executing Court, where execution
proceedings are pending; or
ii. before the Reference Court, where no execution
proceedings are pending;
c. Upon such deposit being made, the beneficiary
shall be deemed to have validly complied with
its obligations under the Mediation Agreement,
and liability for further interest shall cease from
the date of such deposit.
23. An apprehension has been expressed by the learned
counsel for the claimants regarding possible
deduction of tax at source (TDS) and issuance of
Form 16A in respect of the compensation amounts.
This issue is no longer res integra. This Court, in its
earlier order dated 20.08.2025 in
W.P.No.102884/2025 has categorically held that
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compensation awarded on account of compulsory
acquisition of land is not subject to deduction of tax
at source under the applicable provisions of the
Income Tax Act. Accordingly, it is directed that all
payments made pursuant to the Mediation
Agreement, whether to joint accounts or individual
accounts, shall be effected without any deduction of
tax at source.
24. The Mediation Agreement recorded herein shall form
part of this order and shall be treated as a lawful
settlement between the parties within the meaning of
Section 89 of the Code of Civil Procedure, 1908 read
with Order XXIII Rule 3 CPC. The said settlement
shall operate in substitution of any award, judgment,
or decree passed by the Reference Court and/or the
Appellate Court. The concerned Courts are directed
to draw up a decree in terms of the Mediation
Agreement, as affirmed by this order, within a period
of 60 (sixty) days from the date of receipt of a
certified copy of this order.
25. This Court places on record its deep appreciation for
the commendable efforts of Hon’ble Sri Justice A. V.
Chandrashekhar, former Judge of this Court, who as
Mediator, has facilitated an effective and result-
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oriented resolution of a long-pending dispute. The
Court also acknowledges the constructive role played
by the learned Advocate General, Sri Shashikiran
Shetty; the learned Additional Advocate General, Sri
Malhar Rao; the learned High Court Government
Pleader, Smt. Maya T. Rajanna; the learned
Additional Government Advocate, Sri Sheshadri
Jaishankar; and the learned counsel appearing for
KNNL, namely, Ms. L.Mohini Bhatt, Sri. Sanjeev
Kumar C. Patil, Sri. M.Sudarshan, and Sri.
Sharanbasava Pastapur.
26. The Court further records its appreciation for the
proactive engagement of the officers of KNNL,
including the Managing Director, Sri Rajshekhar
Aminabhavi; the Company Secretary, Sri Girish M.
S.; the Head of the Legal Team, Sri Balraj S. Patil;
and other officers, namely Sri Vijay Karosh and Sri S.
H. Hiremath, who have contributed to the resolution
in a pragmatic and solution-oriented manner.
27. The Court also places on record its appreciation for
the learned counsel appearing for the claimants, led
by Sri Harshavardhan R. Malipatil, along with Sri
Shivshankar H. Manur, Sri Nagashetty G. Patil, Sri B.
B. Ashtagi, Sri Vishal B. Ashtagi, Sri A. M. Biradar,
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Sri K. S. Sakri, Sri Manvendra Reddy, Sri Vaijanath
Biradar, and Sri S. S. Sajjanshetty, for their
constructive assistance and cooperation in facilitating
the settlement.
28. Having regard to the fact that a substantial number
of land acquisition matters, estimated to be in excess
of 10,000 cases, are presently pending before this
Bench, this Court expresses its earnest hope that a
similar mechanism of mediated settlement may be
explored and adopted in appropriate cases. Such an
approach would not only reduce the burden of
protracted litigation but would also ensure timely and
equitable relief to land losers, while safeguarding the
financial and administrative interests of the State
and beneficiary authorities. The stakeholders who
have contributed to the present settlement are
expected to play a proactive role in extending this
model to other pending matters.
Sd/-
(SURAJ GOVINDARAJ)
JUDGE
VNR
List No.: 2 Sl No.: 2.11
Ct:VK