RAVIKUMAR PROPERTIES PVT. LTD., vs STATE OF KERALA,
- Court
- Kerala High Court
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IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE P.M.MANOJ
TH
WEDNESDAY, THE 20 DAY OF MAY 2026 / 30TH VAISAKHA, 1948
WP(C) NO. 21961 OF 2019
PETITIONERS:
1 RAVIKUMAR PROPERTIES PVT. LTD.,
THIRUMALAI PILLAI ROAD, NANDHITHA APPARTMENT, T NAGAR,
CHENNAI - 600 017, REPRESENTED BY ITS MANAGING DIRECTOR,
RAVIKUMAR R.V., S/O.LATE RAMALINGAM, AGED 62 YEARS, 1ST
CROSS EXTENSION, VILLA BALAJI, RAINBOW NAGAR,
PONDICHERRY.
2 REALITY PROJECT AND ENTERTAINMENT PVT.LTD.,
THIRUMALAI PILLAI ROAD, NANDHITHA APARTMENT, T NAGAR,
CHENNAI - 600 017, REPRESENTED BY ITS MANAGING DIRECTOR,
RAVIKUMAR R.V., S/O.LATE RAMALINGAM, AGED 62 YEARS, 1ST
CROSS EXTENSION, VILLA BALAJI, RAINBOW NAGAR,
PONDICHERRY.
BY ADVS. SHRI.T.R.S.KUMAR
SMT.DEENA JOSEPH
SRI.K.RAJAN (MUHAMMA)
SRI.P.B.PRADEEP
SRI.SWATHY S ANIL
RESPONDENTS:
1 STATE OF KERALA,
REPRESENTED BY ITS CHIEF SECRETARY, SECRETARIAT,
THIRUVANANTHAPURAM - 695 001.
2 THE LAND REVENUE COMMISSIONER,
SECRETARIAT, THIRUVANANTHAPURAM - 695 001.
3 THE DISTRICT COLLECTOR,
CIVIL STATION, KAKKANAD, ERNAKULAM - 682 030.
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4 THE SPECIAL TAHSILDAR (LAND ACQUISITION),
CORPORATION OF KOCHI9, VYTTILA - 682 003.
5 THE SECRETARY, CORPORATION OF KOCHI,
REVENUE TOWER, 8TH FLOOR, PARK AVENUE ROAD, ERNAKULAM -
682 011.
BY ADVS. SRI.Y.JAFARKHAN,GOVERNMENT PLEADER
SRI.D.G.VIPIN, STANDING COUNSEL, KOCHI
MUNICIPAL CORPORATION
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON
27.03.2026, THE COURT ON 20.05.2026 DELIVERED THE FOLLOWING:
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P.M. MANOJ, J C.R.
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Dated this the 20 day of May, 2026
JUDGMENT
The writ petition is preferred by two firms owned by one
Ravikumar, whose properties were acquired for a public purpose
pursuant to a notification published under Section 4(1) of the Land
Acquisition Act, 1894 (for short ‘the LA Act’). However, during the
pendency of the said proceedings, the Right to Fair Compensation and
Transparency in Land Acquisition and Rehabilitation and Resettlement
Act, 2013 (for short ‘LAAR Act, 2013’) came into force on 01.01.2024.
In this regard, 50% of the compensation had already been paid prior
to 01.01.2014, while the remaining compensation was paid only in
the year 2018. According to the petitioner, he was compelled to
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execute agreements for sale in favour of the 5 respondent
Corporation, which, it is alleged, amounts to a fraud on the power of
eminent domain, since neither the Constitution of India nor the special
statute governing the acquisition provides for sale or negotiated
purchase of property under acquisition.
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2. In such circumstances, the petitioner seeks to quash Exts.P14
to P24 awards and to direct the respondents to redetermine the
compensation in accordance with LARR Act, 2013. The petitioner also
seeks to quash Exts.P38 and P39 on the ground that the said
documents are in contravention of the LARR Act, 2013. Further, the
petitioner seeks a declaration that Exts.P38 and P39 sale deeds were
executed with the intention of curtailing just and fair compensation
payable under the LARR Act, 2013, and are therefore null and void
and violative of Articles 14, 21, 38, 39(a), and 300A of the
Constitution of India.
3. It is the case of the petitioners that they are private limited
companies represented by their Managing Director, who is a native of
Pondicherry and, therefore, is not conversant with reading and writing
Malayalam. The petitioners were the absolute owners and title holders
in possession of 2.232 acres of land situated in Ernakulam Village,
Kanayannur Taluk, Ernakulam District. The property lies as a single
compact plot on the eastern side of M.G. Road, Ernakulam, having a
frontage of 25 meters to M.G. Road, and is classified as dry land.
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4. The petitioners contend that the subject properties are
situated in a prime location in the State, as they lie on both sides of
M.G. Road and possess significant commercial value. The high
commercial importance of the properties was expressly recognised by
this Court in its judgment dated 13.03.2013 in W.P.(C) No.30355 of
2012.
5. The petitioners further contend that the market value of
properties on both sides of M.G. Road ranges between ₹62 lakh and
₹65 lakh per cent. In support of this, it is stated that a property in
close proximity to the petitioners' land was purchased for ₹65 lakh
per cent in 2014. Similarly, a Mumbai-based company acquired a
property situated 450 meters away for ₹28 lakh per cent as far back
as 1996. Furthermore, the petitioners point to a 10-cent plot on the
northern side of S.A. Road, Ernakulam, which was sold in 2010 for
₹35 lakh per cent, despite that area having significantly lower
commercial value than M.G. Road. By citing these sale deeds and
documents, the petitioners seek to establish the fair and prevailing
market value of their own property.
6. A requisition for acquisition was submitted by the Cochin
rd
Corporation to the 1st Respondent (State) and the 3 respondent
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(District Collector) for the construction of the Atlantis Railway
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Overbridge at Thevara. Consequently, the 4 respondent (Land
Acquisition Officer) issued a notification under Section 4(1) of the LA
Act, seeking to acquire an area of 65.386 Ares (161.568 Cents) for
the said public purpose. The petitioner raised no objections, and
following the notification, the Land Acquisition Officer published the
Section 6(1) Declaration on January 6, 2013. A Basic Valuation Report
(BVR) for the property was subsequently prepared on October 20,
2012. However, the petitioner alleges that despite the property being
"pacca dry land”, it was erroneously classified as "wetland reclaimed
to dry land" without M.G. Road frontage and was instead described as
being accessible only through a specified access.
7. At the time of the Section 4(1) Notification, the subject
properties were mortgaged in favour of M/s.Sundaram Finance,
Chennai, and other nationalised banks. By 2012, the loans availed
against these properties had fallen into arrears, and the accounts
were classified as Non-Performing Assets (NPA), with a total
outstanding liability of ₹20 Crores. This financial standing was
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disclosed to the 4 respondent (LAO) via Exhibit P12, issued by
Sundaram Finance.
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8. The petitioners assert that the respondents exploited this
vulnerable financial position by offering immediate compensation—to
be paid within one month—contingent upon the execution of a sale
agreement. Although the agreement was drafted in Malayalam, a
language the petitioners do not understand, the petitioner contends
that he was compelled by circumstances to sign the documents and
forms provided by the LAO to ensure expeditious receipt of the funds.
9. Consequently, the petitioners executed an agreement dated
July 15, 2013 (Exhibit P13), on the condition that the respondents
would release 80% of the compensation within 15 days and the
remaining 20% within one month. Following the execution of this
agreement, the respondents released a total compensation of
₹19,58,29,508/-, of which 50% was paid prior to January 1, 2014.
10. During the pendency of the acquisition proceedings, the
LARR Act, 2013 came into effect on January 1, 2014. The petitioners
contend that since the acquisition proceedings had not been
completed by that date, they were entitled to compensation under the
2013 Act. It is further argued that Section 24 of the LARR Act is
squarely applicable to this case.
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11. The petitioners submit that the Land Acquisition Officer
(LAO) was required to pass an award under the LA Act, 1894 prior to
January 1, 2014; failing this, the respondents were legally bound to
pass the award under the provisions of the 2013 Act. Instead, the
petitioners allege they were compelled to sign the Exhibit P13
agreement after January 1, 2014—an act they claim is void ab initio
and non est in the eyes of the law. They further assert that Exhibit
P13 constitutes a "fraud on the power of eminent domain" committed
by the State.
12. With the alleged intention of defeating the petitioners'
statutory right to compensation under the 2013 Act, the LAO passed
awards in various cases (LAC Nos. 13/2013 to 24/2013, marked as
Exhibits P14 to P24) on various dates between 2015 and 2016.
Notably, no award was passed in LAC No. 19/2013. The petitioners
maintain that these awards directly contravene Section 24(1)(a) of
the LARR Act, 2013.
13. Based on these awards, a total sum of ₹39,17,22,001/- was
released, with the final payment being made on July 11, 2018, for a
total acquired area of 163.41 cents. However, the petitioner claims
that the respondents withheld the final payment, threatening not to
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release it unless the petitioner executed a sale deed in favour of the
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5 respondent. The petitioner’s continuous efforts to secure the
balance compensation between 2013 and 2018 are documented in
Exhibits P25 to P37.
14. The petitioner contends that he was kept in a state of
uncertainty for four and a half years. Finding no other means to secure
the compensation withheld by the State, he was ultimately forced to
assent to the conditions and stipulations unilaterally imposed by the
respondents.
15. Consequently, the respondents allegedly succeeded in
compelling the petitioners to execute sale deeds (Exhibits P38 and
P39) in favour of the 5th Respondent Corporation for the properties
already covered under the Section 4(1) Notification, the Section 6(1)
Declaration, and the awards (Exhibits P14 to P24). The petitioners
argue that this constitutes a fraud on the power of eminent domain,
as the authorities were well aware that the petitioners were entitled
to significantly higher compensation under the LARR Act, 2013.
Instead, through misrepresentation and the concealment of material
facts, the respondents induced the petitioners to act to their own
detriment.
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16. It is further alleged that both the requisitioning and the
acquisition authority exercised the power of eminent domain with
dishonest and malicious intent. Invoking the legal definition of
cheating—namely, dishonest inducement of a person to deliver
property or valuable security—the petitioners assert that the State
withheld 50% of the compensation for over five years. This delay was
a calculated attempt to coerce the petitioners into executing an
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agreement and surrendering their property to the 5 respondent.
Ultimately, the petitioners contend that these acts were designed to
deceive them, resulting in substantial monetary loss while facilitating
the unlawful enrichment of the Cochin Corporation. They characterise
this as a "State-sponsored case of cheating," perpetrated through
illegalities that violate Articles 14, 21, 38, 39(a), and 300A of the
Constitution of India.
17. It is further contended that a comparison under Section 40
reveals clear discrimination in the grant of compensation among
similarly situated persons in the locality. Although the right to
property is no longer a fundamental right, it continues to remain a
constitutional right protected under Article 300A and cannot be taken
away except by authority of law. In this regard, the petitioner
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contends that the LARR Act, 2013 is a beneficial legislation;
specifically, Sections 11(4), 24, 40, 46, and 104 thereof are squarely
applicable to the facts of this case.
18. To substantiate these contentions, the petitioners rely on
Indore Development Authority v. Manoharlal and Others [AIR
2020 SC 1496]. Under the provisions of Section 24(1)(a), if an award
had not been made by the commencement of the 2013 Act (January
1, 2014), the proceedings do not lapse, but compensation must be
determined under the 2013 Act. Accordingly, the solatium should be
100%, as stipulated in the 2013 Act, rather than the 30% provided
under the 1894 Act.
19. Furthermore, the petitioners refer to Shanavas and Others
v. State of Kerala and Others [2017 (4) KHC 148]. In that case,
this Court observed that while the Government does not lose its power
of eminent domain to purchase land through negotiation, the clear
and distinct terminology of the 2013 Act makes it imperative for the
Government to proceed under the new Statute to satisfy the mandate
of Article 300A.
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20. The petitioners argue that while the 1894 Act contained
enabling provisions for "agreed purchases" and consequential awards,
such provisions are conspicuously absent in the 2013 Act. This
absence of power, coupled with the lack of rules enabling the State
Government to resort to negotiated purchases, indicates a conscious
legislative intent to prevent the State from bypassing the new Act to
the disadvantage of landowners. Moreover, Section 64 of the 2013
Act provides landowners with the right to seek a reference if they are
dissatisfied with the compensation—a statutory protection that
overrides and takes precedence over any negotiated purchase.
21. Although the aforementioned judgment was challenged
before the Division Bench of this Court, the Bench declined to exercise
its appellate jurisdiction. While a Special Leave Petition (SLP) against
that decision is currently pending before the Hon’ble Supreme Court,
the petitioners contend that there are distinct factual differences in
the present case.
22. Here, the properties were taken into possession by the
respondents in compliance with the provisions of the 1894 Act—
specifically Sections 4(1) and 6(1)—and possession was indeed taken
before January 1, 2014. However, the final awards were passed only
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after January 1, 2014. These specific facts were not present in the
Shanavas case supra currently pending before the Apex Court. The
petitioners argue that the sole reason the 2013 Act was not
implemented at the time was the State’s failure to frame the
necessary Rules under the new Act. In similar circumstances, this
Court has previously ordered the surrender of land for public purposes
subject to payment of enhanced compensation under the 2013 Act.
23. Relying on decisions rendered by the High Court of
Telangana in Ittyreddy Mangava and Others v. State of
Telangana and Others , (MANU/TL/0177/2020) and the Hon'ble
Supreme Court in Rameshwar and Others v. State of Haryana
and Others (2018 KHC 6182) and Uddar Gagan Properties v. Sant
Singh and Others (2016 KHC 6363), counsel for the petitioner seeks
to establish that the respondents’ actions constitute a "fraud on the
power of eminent domain."
24. To define this fraud, the petitioners rely on State of A.P.
and Others v. T. Suryachandra Rao (2005 KHC 1262) Bhaurao
Dagdu Paralkar v. State of Maharashtra (2005 KHC 1429) and
Shrisht Dhawan v. Shaw Bros (1992 KHC 772). Fraud is defined
as an act of deliberate deception designed to secure an unfair
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advantage over another. It is a deception practised to gain at
another's loss; in essence, it is cheating intended to secure an
unlawful advantage.
25. According to the petitioner, fraud is established when it is
shown that a false representation has been made: (1) knowingly, (2)
without belief in its truth, or (3) recklessly and carelessly as to
whether it be true or false. These contentions were countered by the
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4 respondent in an affidavit dated November 28, 2019.
26. In the counter-affidavit, it was admitted that the petitioners'
property was acquired at the request of the Cochin Municipal
Corporation for the construction of the Atlantis Junction Railway
Overbridge. The respondents maintain that the proceedings were
initiated under the LA Act, which was the prevailing legislation at the
time. Furthermore, the "emergency clause" was invoked upon the
request of the requisitioning authority.
27. Accordingly, the Section 4(1) Notification was published in
the Official Gazette of Kerala on August 14, 2012, followed by the
Section 6(1) Notification on January 4, 2013. The respondents
contend that the lands were acquired under Section 11(2) through a
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negotiated settlement reached during a District Level Purchase
Committee (DLPC) meeting on November 13, 2012, to which the
petitioners were duly invited.
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28. The 4 respondent further disputes the petitioners’ claim
regarding road frontage, asserting that the acquired land has no direct
frontage on M.G. Road. According to the Basic Tax Register (BTR), the
lands in Survey Nos. 2389/1, 3, 5, and 6 are recorded as 'Nilam'
(wetland), while Survey Nos. 2389/2 and 4 are recorded as
'Purayidom' (dry land). The respondents state that although the
'Nilam' portions were found to have been converted at the time of
inspection, the draft declaration correctly remarked them as "Nilam
now reclaimed as Purayidom." It is further stated that, as per the
survey records, Survey Nos. 2383/2 and 4 are narrow strips of land
(0.30 Ares and 05.67 Ares, respectively) separating the wetland.
Consequently, based on its physical location, the property was
categorized as Category IV: "Wetland now reclaimed to dry land, lying
interior near to M.G. Road."
29. The primary thrust of the 4th Respondent's argument is that
the property was acquired through negotiation under Section 11(2) of
the LA Act. They contend that the petitioners accepted the price fixed
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by the District Level Purchase Committee (DLPC)—chaired by the
District Collector—and voluntarily signed the agreement in Form 10(a)
under Rule 12(5) of the Land Acquisition (Kerala) Rules, 1990.
Subsequently, the petitioners accepted the full compensation from the
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4 respondent and executed the formal sale deeds.
30. The respondents argue that under the conditions of the Form
10(a) agreement, there is no provision for seeking a court reference
or any revision of the land value. Consequently, they maintain that
the value accepted by the petitioners is final and cannot be reviewed.
Furthermore, the Basic Valuation Report (BVR) was prepared based
on documents executed three years prior to the Section 4(1)
Notification. Therefore, the petitioners' reliance on Exhibits P3 to P5,
which post-date the Section 4(1) Notification, is legally untenable.
31. Following the Section 4(1) Notification, the BVR was
prepared by the Land Acquisition Officer (LAO) and approved by the
District Collector on October 20, 2012. Due to a disagreement
regarding the initial valuation, the LAO forwarded the files to the
District Collector to initiate negotiated purchase proceedings under
Section 11(2). During the DLPC meeting attended by the petitioners,
the land value was increased from ₹33,64,761/- per Are to
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₹59,79,820/- per Are. The respondents assert that the petitioners
raised no objections, signed the Form 10(a) sale agreement, and
handed over possession of the land on June 29, 2013.
32. Upon approval from the State Level Empowerment
Committee (SLEC), 50% of the agreed amount was released. After
the award was passed, the sale deeds were executed under the
Registration Act in favour of the Secretary, Cochin Municipal
Corporation. The respondents contend that since the land was
transferred via a negotiated price agreed upon by both parties, it does
not constitute a "compulsory acquisition." Therefore, they argue that
Section 24 of the LARR Act, 2013 is inapplicable.
33. Finally, it is stated that awards were passed in all cases
(except LAC 19/15) based on the SLEC rates and the Form 10(a)
agreements. These payments did not include solatium or other
statutory benefits, as the acquisition was treated as a voluntary
negotiation rather than a compulsory one. Regarding LAC No. 19/15,
the balance amount was disbursed to the petitioners via proceeding
No. C20/11 dated June 6, 2018.
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34. In light of these circumstances, the respondents contend
that the prayers sought in the Writ Petition cannot be granted. They
argue that the Basic Valuation Report (BVR) is inapplicable here, as
the transfer of property was concluded based on a rate negotiated and
mutually agreed upon by the parties. The agreement itself
categorically stipulates that the owners and interested parties shall
not claim any amount in addition to the agreed compensation, which
was accepted without protest.
35. The respondents acknowledge the petitioners' statement
that the lands were mortgaged to several financial institutions and
that the petitioners were facing a severe financial crisis. They contend
that under existing laws, there is no provision to sell land while it
remains encumbered by mortgages. Consequently, the petitioners
failed to clear their arrears in a timely manner. The registration of the
sale deeds in favour of the Secretary of the Municipal Corporation was
delayed due to these factors, for which the respondents are not
responsible. Even after a lapse of four years, the petitioners
approached the respondents to register the sale deeds, and the
balance amount was released upon registration; thus, there was no
wilful delay on the part of the State.
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36. Furthermore, it is argued that Section 24(1) of the LARR Act,
2013 is inapplicable to the facts of the present case. Since the land
value was settled through negotiation at the DLPC and the petitioners
signed the Form 10(a) agreement under the relevant rules, they have
waived their right to file Land Acquisition Reference (LAR) petitions.
The respondents maintain that the property was legally transferred
only after the execution of the sale deeds (Exhibits P38 and P39). At
the time of signing, the petitioners never raised any claims under the
2013 Act.
37. The respondents further submit that the 2013 Act does not
prohibit the execution of sale deeds. They argue that proceedings
under the Land Acquisition Act and a voluntary sale are two distinct
legal tools: one involves an element of compulsion, while the other is
based on voluntary consent. Under the Transfer of Property Act, the
State can purchase property from individuals without fetters. This
position was considered by a Division Bench in W.A. No. 2466/2017,
which noted that the authority of the State to contract for the
purchase of property is a distinct matter. Although an SLP is pending
and the operation of that judgment has been stayed by the Apex
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Court, the respondents maintain that the present Writ Petition is
devoid of merit and liable to be dismissed.
38. I have heard Sri.TRS Kumar, learned counsel for the
petitioners, Sri.Jaffer Khan Y, learned Govt. Pleader for the
th
respondents 1 to 4 and Sri.D.G.Vipin, Standing Counsel for the 5
respondent.
39. The following questions are framed for consideration in this
case:
1. Whether the awards (Exhibits P14 to P24), passed under the
Land Acquisition Act, 1894, after January 1, 2014, are legally
sustainable in view of the transitional provisions contained in
Section 24 of the LARR Act, 2013.
2. Whether mortgaged properties can be validly transferred
through a negotiated agreement—specifically a Form 10(a)
agreement under Section 11(2) of the 1894 Act—as contended
by the respondents.
3. Whether the sale deeds (Exhibits P38 & P39) executed on June
7, 2018, are legally valid and sustainable, considering that
possession of the land had already been surrendered on June
29, 2013.
4. Whether the actions of the respondents in this matter constitute
a "fraud on the power of eminent domain."
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While evaluating the contentions to answer the first issue, it is
primarily necessary to consider the dates on which the awards were
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passed by the 4 respondent.
40. A review of Exhibits P15 to P24 awards (concerning LAC
Nos. 14 to 24/2013, excluding 19/2013) shows that they were passed
between June 23, 2015, and November 21, 2016. The land acquisition
proceedings were initiated via a Section 4(1) Notification on August
14, 2012, followed by a Section 6(1) Declaration on January 6, 2013.
During the pendency of these proceedings, the LARR Act, 2013 came
into force with effect from January 1, 2014.
41. The relevant portion of Section 24 of the LARR Act, 2013
reads thus:
"
24. Land acquisition process under Act No. 1 of 1894 shall be
deemed to have lapsed in certain cases.
(1) Notwithstanding anything contained in this Act, in any case of
land acquisition proceedings initiated under the Land Acquisition
Act, 1894,-
(a) where no award under section 11 of the said Land Acquisition
Act has been made, then, all provisions of this Act relating to the
determination of compensation shall apply; or
(b) where an award under said section 11 has been made, then such
proceedings shall continue under the provisions of the said Land
Acquisition Act, as if the said Act has not been repealed.
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(2) Notwithstanding anything contained in sub-section (1), in case
of land acquisition proceedings initiated under the Land Acquisi-
tion Act, 1894, where an award under the said section 11 has been
made five years or more prior to the commencement of this Act but
the physical possession of the land has not been taken or the com-
pensation has not been paid the said proceedings shall be deemed
to have lapsed and the appropriate Government, if it so chooses,
shall initiate the proceedings of such land acquisition afresh in ac-
cordance with the provisions of this Act:
Provided that where an award has been made and compensation
in respect of a majority of land holdings has not been deposited in
the account of the beneficiaries, then, all beneficiaries specified in
the notification for acquisition under section 4 of the said Land Ac-
quisition Act, shall be entitled to compensation in accordance with
"
the provisions of this Act.
The Proviso to Section 24 further stipulates that where an award
has been made, but compensation in respect of the majority of
landholdings has not been deposited into the accounts of the
beneficiaries, then all beneficiaries specified in the Section 4
Notification shall be entitled to compensation in accordance with the
provisions of the LARR Act, 2013 .
42. This issue was addressed by the Hon’ble Supreme Court in
its landmark judgment in Indore Development Authority (supra) .
The Apex Court clarified that if an award was not made as of January
1, 2014 (the date of commencement of the 2013 Act), the
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proceedings do not lapse; however, compensation must be
determined under the provisions of the 2013 Act. Furthermore, the
Court clarified that solatium under the 2013 Act is 100%, as opposed
to the 30% stipulated under the 1894 Act.
43. In the present case, although the land acquisition
proceedings were initiated on August 14, 2012, the awards were not
passed until 2015 and 2016. Consequently, it is established that no
award had been passed prior to the commencement of the LARR Act,
2013. Following the principles clarified by the Hon’ble Supreme Court
in Indore Development Authority (supra) , the compensation in
this matter must be determined under the provisions of the 2013 Act.
The first issue is, therefore, answered in the affirmative: the awards
passed under the 1894 Act after January 1, 2014, are not legally
sustainable.
44. The second issue concerns the status of mortgaged
properties in acquisition proceedings, is addressed by Rule 12(5) of
the Land Acquisition (Kerala) Rules, 1990, mandates that the
agreement shall be executed in Form 10(a) between the owner(s) or
"any person or persons interested therein" on the one part, and the
District Collector, acting on behalf of the State of Kerala on the other.
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45. From this provision, it is discernible that mortgaged property
can be validly acquired and effectively transferred to the Government
under land acquisition proceedings. However, such proceedings
cannot overlook the mortgage; rather, the mortgagee's interest must
be protected. This protection extends to the compensation amount,
as Rule 12(5) stipulates that the Form 10(a) agreement must be
executed not only by the owner but also by "any person or persons
interested in the land".
46. The expression "person interested" is an inclusive term
intended to encompass mortgagees, charge-holders, and other
encumbrancers. Consequently, the mere existence of a mortgage
does not prevent acquisition. Once the Government takes possession,
the land vests in the State free of all encumbrances. The mortgage is
not extinguished without recourse; instead, the mortgagee becomes
a "person interested" with a primary claim toward the compensation.
47. In the present case, a review of the facts—specifically Exhibit
P12—reveals that M/s. Sundaram Finance had formally addressed the
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4 respondent, intimating their subsisting interest in the acquired
property and requesting that the compensation be disbursed directly
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to them. Consequently, for any agreement signed as part of an award
under Form 10(a), the said financier was a necessary party thereto.
48. However, neither the awards nor the accompanying Form
10(a) agreements disclose the involvement of the "person
interested," namely M/s. Sundaram Finance. Accordingly, the
question of the validity of those specific agreements is left open for
further adjudication due to the lack of sufficient evidentiary materials
presently available on record.
rd
49. Regarding the 3 issue, validity of the sale deeds marked as
Exhibits P38 and P39, executed on August 7, 2018, it is necessary to
consider the legal status of a property owner during acquisition. Once
land acquisition proceedings are initiated, the status of the landowner
undergoes a gradual but legally significant transformation. Ownership
is not divested immediately; rather, it is a process marked by distinct
stages:
1. Issuance of Section 4(1) Notification: At this stage, the
landowner continues to remain the legal owner and is entitled to
the possession, use, and enjoyment of the land, albeit subject
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to certain statutory restrictions on its transfer or further
development.
The transition of a landowner from an absolute owner into a claimant
for compensation occurs through the following legal stages:
1. Restriction of Rights following Notification:
•
Restriction on Alienation: Once the Section 4(1) Notification is
issued, the landowner's right to freely transfer or alienate the
property becomes restricted.
•
Limitation on Improvements: The land is officially marked for a
public purpose; any subsequent improvements or alterations
may not be considered for compensation unless they are proven
to be bona fide .
2. Procedural and Participatory Rights:
• Right to Object: The landowner acquires the procedural right to
file objections as contemplated under Rule 8 of the Land
Acquisition (Kerala) Rules, 1990.
• Right to be Heard: The owner is entitled to be heard during the
acquisition proceedings to ensure due process.
• Right to Fair Compensation: The owner gains the legal standing
to demand that compensation be determined according to
statutory mandates.
3. Status after Declaration and Award:
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• Conversion of Interest: Once the Section 6 declaration is made
and an award is passed, the landowner’s proprietary interest is
legally converted into a right to receive compensation.
• Enforceable Claims: The quantum of compensation, solatium,
and other statutory benefits become an enforceable legal right.
4. Vesting of Land upon Possession:
•
Absolute Vesting: Upon the state taking physical possession, the
land vests absolutely in the State, free from all encumbrances.
• Cessation of Proprietary Rights: The landowner ceases to have
any proprietary right over the land.
• Change in Legal Status: The individual’s status shifts from
"owner" to a "person interested" entitled to compensation.
5. Residual Rights post-Vesting:
•
Right to Challenge: Even after vesting, the former owner may
challenge the acquisition proceedings on limited grounds, such
as illegality, procedural violations, or lack of a public purpose.
•
Enhanced Compensation: The former owner retains the
statutory right to seek enhanced compensation through a
reference to the competent court (Section 64 of the LARR Act,
2013).
6. Residual Rights Even After Vesting:
• Right to Challenge: The former landowner may challenge
the acquisition proceedings on limited grounds, such as
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illegality, significant procedural violations, or the lack of a
legitimate public purpose.
• Right to Enhanced Compensation: The individual retains
the statutory right to seek an enhancement of the
compensation amount through a reference to the
competent court.
50. Based on the aforementioned general principles, it is evident
that once land acquisition proceedings are initiated, the rights of the
property owner are progressively restricted. Once physical possession
of the property has been surrendered or taken over by the State, the
erstwhile owner is legally divested of the capacity to enter into
agreements to transact or alienate the property through standard civil
formalities.
51. In the present case, possession of the land was handed over
on June 29, 2013. However, Exhibits P38 and P39 agreements,
executed alongside Form 10(a) under Rule 12(5), were signed only
on June 7, 2018. Consequently, on the date of execution, the
signatory—the Managing Director of the petitioner companies—was
legally incapacitated from transferring the property, as the companies
no longer held absolute ownership.
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52. Under the provisions of the Transfer of Property (TP) Act,
only a person with clear, uninterrupted ownership and title may validly
transact property. As this essential element of ownership was absent
at the time of execution, Exhibits P38 and P39 are legally
unsustainable and shall be deemed void ab initio.
53. Finally, it must be determined whether there has been a
fraud on the power of eminent domain. In order to address the said
issue, it becomes necessary first to examine the meaning and scope
of the expression "power of eminent domain." Eminent domain refers
to the inherent power of the State to compulsorily acquire private
property for a public purpose, subject to the payment of just
compensation. In the Indian legal context, this power is exercised
within the constitutional limitations prescribed under Article 300A of
the Constitution, which mandates that no person shall be deprived of
their property save by authority of law.
54. In this case, the allegation concerns a "fraud on power." In
administrative law, "fraud" in this context does not necessarily imply
ordinary deceit or dishonesty; rather, it refers to a misuse or abuse
of statutory power. An exercise of power is considered as a fraud on
eminent domain when:
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• Pretext of Public Purpose: The State purports to acquire land for
a public purpose, but the acquisition is, in reality, for private
gain or an extraneous/collateral objective.
• Colourable Exercise of Power: The action appears lawful on its
face but is actually performed to achieve an improper or
unauthorized end.
Key Elements of Fraud on Eminent Domain:
• Absence of a Genuine Public Purpose: The stated objective is a
mere facade.
• Mala Fide Intention: The presence of a collateral motive or bad
faith.
• Disproportionate Private Benefit: The acquisition primarily
benefits a private party rather than the general public.
• Procedural Manipulation: A lack of independent application of
mind or the deliberate subversion of statutory procedures.
Applying these elements, a fraud on eminent domain is made out
when property is acquired under the pretext of public utility but is
subsequently diverted to provide an undue advantage to private
parties through the violation of procedural formalities.
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55. In the present case, the property was acquired for the
construction of the Atlantis Railway Overbridge at Thevara. The
requisitioning authority was the Cochin Municipal Corporation, and the
District Collector appointed the Land Acquisition Officer (4th
Respondent) to oversee the process.
th
56. Following the statutory procedure, the 4 respondent issued
the Section 4(1) Notification, and after the completion of the survey, the
Section 6(1) Declaration was effected. Subsequently, a Basic Valuation
Report (BVR) was prepared. However, prior to the passing of the award
under Section 11, the petitioners signed Form 10(a) agreements under
Rule 12(5) on July 15, 2013. A portion of the compensation was
disbursed to the petitioners before January 1, 2014, in relation to LAC
Nos. 13–18 and 20–24 of 2013.
57. Notably, the final awards for these cases were passed much
later, specifically between June 2015 and November 2016. Regarding
LAC No. 19/2013, the Exhibits P38 and P39 agreements were executed
for the disbursal of the remaining compensation. The petitioners contend
that because the awards were not passed under the 1894 Act before the
transition to the 2013 Act, they were essentially compelled to sign these
agreements to receive their remaining funds. They argue that this
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procedural conduct constitutes a "fraud on the power of eminent
domain." However, based on the legal standards defining such fraud,
the procedure followed by the respondents in this acquisition cannot be
termed a "fraud on the power of eminent domain." The acquisition served
a legitimate public purpose, and the procedural delays do not meet the
threshold of mala fide intention or a colourable exercise of power.
Consequently, this contention is discarded.
58. In light of the foregoing, the Writ Petition is disposed of.
Exhibits P13 to P24, as well as Exhibits P38 and P39, are hereby set aside
for the reasons detailed in the adjudication of the issues framed above.
This order is passed with the intent to grant the petitioners the
benefits mandated under Section 24 of the LARR Act, 2013. Accordingly,
the respondents are directed to redetermine the compensation in
accordance with the provisions of the 2013 Act and disburse the balance
amount to the petitioners after deducting the payments already made.
The entire exercise shall be completed within a period of three
months from the date of receipt of a certified copy of this judgment.
Sd/-
P.M.MANOJ
JUDGE
ttb
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APPENDIX OF WP(C) NO. 21961 OF 2019
PETITIONER’S EXHIBITS
EXHIBIT P1
TRUE COPY OF SALE EED NO.3094/2005 DATED
29/03/2005 EXECUTED IN FAVOUR OF THE
PETITIONERS.
EXHIBIT P2 TRUE COPY OF THE JUDGMENT IN WP(C) NO.30355/2012
DATED 13/03/2013.
EXHIBIT P3
TRUE COPY OF THE SALE DEED NO.148/2014 DATED
10/1/2014.
EXHIBIT P4 TRUE COPY OF THE SAID SALE DEED NO.4360/1996
DATED 17/10/1996 OF SRO ERNAKULAM.
EXHIBIT P5 TRUE COPY OF THE SAID SALE DEED NO.732/2013
DATED 25/02/2013 OF THE SRO, ERNAKULAM.
EXHIBIT P6
TRUE COPY OF SALE DEEDS NOS. 1601/2006, DATED
17/03/2006 EXECUTED BY THE PARTIES FOR THE
PROPERTIES HAVING MG ROAD, FRONTAGE.
EXHIBIT P7 TRUE COPY OF SALE DEED NO.1602/2006 DATED
17/03/2006 EXECUTED BY THE PARTIES FOR THE
PROPERTIES HAVING M.G.ROAD FRONTAGE.
EXHIBIT P8 TRUE COPY OF SALE DEED NO.297/2011 DATED
19/01/2011.
EXHIBIT P9 TRUE COPY OF 4(1) NOTIFICATION DATED 14/08/2012
ISSUED BY THE 4TH RESPONDENT.
EXHIBIT P10 TRUE COPY OF THE 6(1) DECLARATION DATED
06/10/2013 PUBLISHED BY THE 4TH RESPONDENT.
EXHIBIT P11 TRUE COPY OF BASIC VALUATION REPORT (BVR) DATED
20/10/2012.
EXHIBIT P12 TRUE COPY OF LETTER ISSUED BY FINANCIER,
SUNDARAM FINANCE DATED 25/02/2017 ADDRESSING TO
THE 4TH RESPONDENT.
EXHIBIT P13 TRUE COPY OF 10(A) AGREEMENT DATED 15/07/2013.
EXHIBIT P14 TRUE COPY OF THE AWARD IN LAC NOS.13/2013 DATED
21/11/2016.
EXHIBIT P15 TRUE COPY OF THE AWARD IN LAC NO.14/2013 DATED
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23/06/2015.
EXHIBIT P16 TRUE COPY OF THE AWARD IN LAC NO.15/2013 DATED
23/06/2015.
EXHIBIT P17
TRUE COPY OF THE AWARD IN LAC NO.16/2013 DATED
25/08/2015.
EXHIBIT P18 TRUE COPY OF THE AWARD IN LAC NO.17/2013 DATED
23/06/2015.
EXHIBIT P19 TRUE COPY OF THE AWARD IN LAC NO.18/2013 DATED
21/11/2016.
EXHIBIT P20 TRUE COPY OF THE AWARD IN LAC NO.20/2013 DATED
23/06/2015.
EXHIBIT P21 TRUE COPY OF THE AWARD IN LAC NO.21/2013 DATED
25/08/2015.
EXHIBIT P22 TRUE COPY OF THE AWARD IN LAC NO.22/2013 DATED
25/08/2015.
EXHIBIT P23 TRUE COPY OF THE AWARD IN LAC NO.23/2013 DATED
21/11/2016.
EXHIBIT P24 TRUE COPY OF THE AWARD IN LAC NO.24/2013 DATED
21/11/2016.
EXHIBIT P25 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED 27/02/2013.
EXHIBIT P26 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED 22/02/2014.
EXHIBIT P27 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED 29/03/2014.
EXHIBIT P28 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED 26/12/2015.
EXHIBIT P29 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED 07/01/2016.
EXHIBIT P30
TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED 08/08/2016.
EXHIBIT P31 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED 11/10/2017.
EXHIBIT P32 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED 26/10/2017.
EXHIBIT P33 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED 20/11/2017.
EXHIBIT P34 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED 07/03/2018.
EXHIBIT P35 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED 10/03/2018.
EXHIBIT P36 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED NIL.
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EXHIBIT P37 TRUE COPIES OF REQUEST FOR BALANCE COMPENSATION
DATED NIL.
EXHIBIT P38 TRUE COPY OF SALE DEED NO.2310/2018 DATED
07/06/2018.
EXHIBIT P39 TRUE COPY OF SALE DEED NO.2311/2018 DATED
07/06/2018.
EXHIBIT P40 TRUE COPY OF JUDGMENT IN LAR 15/2017 DATED
14/01/2019 OF THE REFERENCE AUTHORITY,
ERNAKULAM.
RESPONDENTS’ ANNEXURES
ANNEXURE I True copy of the judgment in WA No. 124/2022
dated 25.11.2025.
ANNEXURE II True copy of the order in WP(C) No. 40332/2017
dated 13.06.2019.
EXHIBIT R4(a) TRUE COPY OF JUDGMENT IN WA No.2466/2017