Acquisition lapses under Section 24(2) when authorities neither take possession nor pay compensation for five years.

The petitioners claimed ownership and possession of 3.176 hectares in Village Niranjanpur, included in Indore Development Authority (IDA) Scheme No. 114 Part-II.

An award was passed on 27 November 1992, but the petitioners’ predecessor had entered into an agreement with IDA permitting conditional private development, and IDA subsequently maintained that the land had been released from the scheme.

The petitioners’ predecessor and the parties pursued several proceedings concerning the land; the petitioners later sought development permission.

In 2014–2015, IDA asked the Collector to take possession under the 1992 award, prompting this petition to quash the relevant letters and prevent dispossession.

IDA opposed the petition, alleging breach of the agreement and conditions of the ceiling exemption, and contending that litigation had prevented it from taking possession.

Section 24(2) of the 2013 Act, as interpreted by the Constitution Bench in Indore Development Authority v. Manoharlal, provides for deemed lapse where, for five years or more before the 2013 Act commenced, authorities had neither taken possession nor paid compensation; periods during which court orders stayed proceedings are excluded from the calculation.

The Court also exercised its supervisory jurisdiction under Article 226 to review the challenged administrative action.

In addressing the subsequent-purchaser objection, it distinguished the authorities relied on by IDA on the basis that the petitioners’ land had been treated as released from acquisition and that their predecessor had pursued proceedings concerning it.

The Court considered the award date, the periods covered by court proceedings, and the remaining period before commencement of the 2013 Act.

Excluding the periods it identified as covered by stays, it found that more than five years had elapsed without possession being taken or compensation being paid, and concluded that the acquisition had lapsed.

It also relied on the record indicating that IDA had previously treated the land as released from the scheme and that possession had not been taken.

On that basis, it rejected IDA’s objections, including its reliance on the petitioners’ status as subsequent purchasers, and found the renewed efforts to take possession unwarranted.

It restrained the respondents from taking further action against the petitioners in respect of the land on the basis of the acquisition.