Karnataka HC Sets Aside Land Compensation Hikes, Citing Appeals Filed Up To 24 Years Late And A 19-Year-Later Award From Another Taluk

In brief

The question

Whether the First Appellate Court could rely on the 1999 acquisition award for lands in Indankal, Chittapur Taluk, to determine compensation for lands in Sedam, including by applying reverse de-escalation

The court held

The High Court allowed the Cement Corporation’s appeals, set aside the First Appellate Court’s judgments and awards in LACA Nos. 191, 192, 193, 221 and 348, and dismissed the landowners’ appeals on the merits and for delay.

It also directed

The substantial questions of law were answered accordingly; no order was made as to costs

01Facts

The respondents’ lands were acquired under Section 4(1) notifications dated 11 September 1980 and 2 May 1988.

p. 8

The Reference Court enhanced compensation to Rs.8,000 per acre in four matters; in a fifth matter, it awarded Rs.5,000 per acre.

p. 8

The landowners appealed under Section 54 of the Land Acquisition Act, 1894, in 2019–2020, with delays ranging from 3,835 to 8,828 days.

pp. 11–13

The First Appellate Court condoned the delays and enhanced compensation by relying on an award concerning lands in Indankal village, Chittapur Taluk, acquired under a 1999 notification, applying 3% annual de-escalation.

pp. 11–13

The Cement Corporation challenged those appellate judgments and awards

pp. 11–13

02Issues

i.Whether the First Appellate Court could rely on the 1999 acquisition award for lands in Indankal, Chittapur Taluk, to determine compensation for lands in Sedam, including by applying reverse de-escalation

pp. 9–11, 17–19

ii.Whether the substantial delays in filing the landowners’ appeals were supported by sufficient cause and could properly be condoned

pp. 9–10, 20–21

iii.Whether non-payment of the Reference Court’s award justified enhancement by reference to compensation awarded in another acquisition

p. 21

03Law Applied

Under Section 23 of the Land Acquisition Act, 1894, market value is determined by reference to the market rate of similarly situated lands prevailing on the date of acquisition or before it.

pp. 17–21

The Court relied on Bhupal Singh v. State of Haryana, (2015) 5 SCC 801, which held that a later acquisition award cannot be used as a basis for determining an earlier acquisition’s market value by deducting an annual percentage; escalation may, in appropriate cases, be applied to sale-deed prices for adjacent, similarly situated lands.

pp. 17–21

Delay must be supported by sufficient cause, with an explanation addressing the reasons that prevented timely filing; the requirement that every day’s delay be explained does not dispense with the need to justify exceptionally long delay.

pp. 17–21

Finality and parity are relevant considerations, but parity requires a proper basis for comparing the lands

pp. 17–21

Provisions in the judgment · 3

Land Acquisition Act, 1894 Section 4Section 23Section 54

04Reasoning

The Appellate Court gave no reasoned basis for treating lands in Indankal, Chittapur Taluk, as comparable to lands in Sedam, Sedam Taluk.

pp. 16–19

The lands were in different taluks, more than 10 kilometres apart, and the record did not establish similar geographical features or potentiality.

pp. 16–19

Further, the comparator acquisition was notified 19 years after the acquisitions in question, making the reverse de-escalation method impermissible under Bhupal Singh

pp. 16–19

The delay affidavits did not explain why the appeals had not been filed within the statutory period; stating that compensation was inadequate or unpaid did not explain the delay in challenging the Reference Court awards

pp. 20–21

Any unpaid compensation under those awards could be pursued separately and did not justify enhancement based on an unrelated award

p. 21