An acquisition beneficiary excluded from reference proceedings must be heard before compensation is redetermined.

Manjegowda’s land, measuring a total of 25½ guntas in Echalahalli village, was acquired for the Yagachi Reservoir Project.

The Land Acquisition Officer awarded compensation at Rs.63,800 per acre.

On a reference under Section 18(1) of the Land Acquisition Act, the Reference Court enhanced compensation to Rs.20,000 per gunta, with solatium and interest.

Manjegowda appealed seeking further enhancement.

During the appeal, the beneficiary, Cauvery Neeravari Nigam, was impleaded; it sought a remand because it had not been a party before the Reference Court and had not had an opportunity to contest the compensation claim.

The appellants relied on a Division Bench decision in MFA No.7278 of 2015, in which the matter had been remitted in similar circumstances.

Whether the Reference Court’s compensation order should be set aside and the matter remitted because the beneficiary was not a party before that court and had no opportunity to contest the claim.

Whether the appeal should be allowed without expressing any view on the merits of the compensation claim.

The appeal was brought under Section 54(1) of the Land Acquisition Act, and the compensation claim originated in a reference under Section 18(1) of that Act.

The Court applied the approach in the Division Bench decision in MFA No.7278 of 2015: where the beneficiary was not made a party before the Reference Court, the matter may be remitted to give the beneficiary a suitable opportunity to contest the claim.

The Court also directed refund of court fee under Section 64 of the Karnataka Court Fees and Suits Valuation Act.

The beneficiary was absent from the proceedings before the Reference Court and therefore had not been heard when compensation was enhanced.

The Court considered the Division Bench’s treatment of materially similar circumstances applicable and concluded that the beneficiary should be given an opportunity to contest the claim before the compensation dispute was reconsidered.

It accordingly left all merits contentions open and expressed no opinion on the proper compensation.

The Reference Court’s order dated 9 January 2013 was set aside, and the matter was remitted for fresh reconsideration, with a suitable opportunity for the beneficiary to contest the case on the merits.

All contentions were kept open; the Reference Court was directed to expedite the matter, and the Registry was directed to refund court fee in accordance with Section 64 of the Karnataka Court Fees and Suits Valuation Act.