Land Acquisition Act 2013 - Critical Analysis of Feb 18 SC Judgment in Indore Dev Authority

Supreme Court of India judgments:

Indore Devlopment Authority Vs Shailendra [IDA 2018] rendering PMC vs Harakchand per incurium [PMC2014].

A Critical Analysis.

A. Payment /Tender Payment/Paid

1. The word payment is considered by IDA2018 incorrectly. Word "payment" has to be read with the word "receive" appearing in s/31(2). Absent receipt, the payment is incomplete.
2. The payment and receipt are positive acts and have to be proved, considered and appreciated, with positive evidence only. The "refusal to receive" being a fact against the claimant, and intended to be used against the claimants, it has to be established by cogent evidence, and cannot be inferred.

B. Time of Payment:

1. S/34 of LAA1894 provides that the LAO has to make payment "on or before taking possession".
2. As per s/18 of  LAA 1894 provides that the claimants have to file their Land Reference before 42 days from "the date of Award".
3. S/37,38,55 of Indian Contract Act r/w judgment of SC in Tata Cellular states that the discharge of obligation must be made [i] unconditionally [ii] at "proper time" [iii] exact and full amount as per Award. [In same principle of RECEPROCITY by which the claimant is judged, so shall the LAO] If the LAO fails to honour his own award "by not making payment before taking possession" he has himself rendered the Award Void. The claimants therefore need not receive the compensation under VOIDED AWARD. And even if received after possession is taken, the claimant are only required to refund the amount u/s65 [same principle as applicable in Repeal of ULC].  Further once the "time starts running" as to the date on which the payment is to be made i.e. at or before taking possession[s/34], no amount of offer to tenders, depositing the amount in whatsoever account/treasury et al, can make good, the voidance of the award by the LAO in first place itself.
4. Thus if the LAO takes possession [before or simultaneously] without making payment of compensation to the claimant, the possession taken by the LAO is illegal. Thus no Court or Actus Curia can come to rescue the LAO, defending his illegal possession or by depositing of the amount in Treasury by LAO after taking illegal possession. Once the LAO takes lawful possession time start running for next 5 years against the LAO and no amount of "actus curia" can stop it. After 5 year if he has not paid the amount, he fall in the trapping of 24(2) of 2013 Act.
5. One may feel that if the Award is Voided by LAO by not fulfilling, or Award is made not with any intent to fulfill it, there is not Award, however this is another angle to be explored.
6. In the premise when time of "payment and receipt by claimant" u/s 18, r/w 34, 31, of 1894 Act has lapsed; the award is lapsed by the LAO dishonoring it and not performing it, and falls in mischief of 24(2) of LAA2013.
7. The proper test for "PAYMENT" is [a] "whether the money is parted by the LAO and 'beyond his control' OR whether LAO is in control of the account?" OR [b] "does the claimant have control over the money"?. The statements in IDA2018 that amount deposited with LAO and Treasury, Courts as per Civil Manual are extraneous to the main realistic concept of "Payment and Receipt".
8. Thus it is clear that the LAO has to make payment well within the time so that the claimants can consider and decide what legal recourse to be taken, given the restraining time period u/s/18 and proviso to s/31(2), whether to receive or not &/or what to protest about. Absent payment in time the entire Award is frustrated.
9. The payment in section 18, 31to 34 of LAA1894 and 24 of LAA 2013 has to be reckoned and tested with "POSSESSION". And, possession is preceded or contemporaneous to payment of compensation.
10. It may be noted that once the Award is made, the LAO become debtor and the claimants creditor. And thus the debtor has to seek the creditor and satisfy the creditor. There are several judgments in context of Order 21 Rule 89 of CPC, section 83 of Transfer of Property Act, where, the satisfaction and acceptance of & by the creditor is must to relieve the debtor of his liability. Accordingly there is no such thing as "constructive receipt/virtual receipt". Here even deposit isn't discharge unless accepted by the claimants or applied under s/33 of 1894 Act.
11. It may be noted that as per IDA2018 the vesting is complete[misinterpretation]. But to go further and say that, the discharge of LAO-debtors liability under his own award, "is constructive", is to deprive and claimants from their land and money. The LAA1894 says that after acquisition proceeding have started the claimant losses his right to deal with his land for 4+ years, whereafter possession is taken. The compensation is dated back to section 4 notification, so the claimants are deprived of valuable compensation on the date of possession being taken. In private sales the value of land is closely contemporaneous on the date of possession.
12. Thus to deprive the claimant of full compensation, in time, is violative of Article 21 and 300A. LAO by depositing the amount in treasury, the LAO is illegally taking claimant land and not paying him.
13. Money is "property" within meaning of Art300A and depriving of the property by making illegal rules circulars and notification is violation of art300A too.
14. "Property" of the claimant "in money" in treasury account, without control over it, when it is in treasury account of the LAO, is colourable payment. (1889-1890) 17 Law. Rep. Ind. App. 90
15. The SC in AIR 1972 SC 268 has said that the word "Received by" refers to cash system. Thus in all case other than cash system negotiable instrument are imperative. There have been cases in cash transactions where the poor claimants don’t get money and their signatures are fraudulently taken.
16. The IDA2018 - amounts to "deemed payment" which is not the intent of either 1894 act or 2013 act.
17. IDA2018 ought have first framed a basic question

[i] when is the amount of compensation payable?

[ii] when can it be said that the amount "paid and received"? Absent that the question and finding thereon, the exercise of treasury payment was futile, given legal concept of "paid and received".

1. The right of the claimants to payment of compensation [timely and full], cannot be frustrated by theories of "practices" [para 66, 78], trickery and superfluous interpretations, and abuse of Art/300A.
2. The judgments relied iro deposits and consequence were not relevant as they were not tested with the factor of lapsing u/s/24.
3. By relying on section 61 of Indian Contract Act in IDA2018, the provisions of sections 29, 36, 38, 55, 65 automatically come into play.
4. If the amount is not deposited in Court as per Section 33 of LAA1894, the claimants loss investments and returns thereunder.

C. The essence of s/24 can be seen in general vis-à-vis Money Decree[Award] i.e.:

[i] if a decree is not passed as on 2014 then a computation of compensation shall be as per 2014 act.

[ii] if a decree is passed then the computation shall be under that decree

[iii] [a] if a decree is passed and "PAYMENT" has not made under the decree by the "Judgment Debtor-LAO"  OR [b] the "thing" under decree is not taken possession of by the "Judgment Debtor-LAO"  [after payment of decretal amount to Decree Holder{no court will allow judgment debtor to take possession of a thing without payment of decretal amount}],

either of [a] or [b] 5 year prior to 2014, then, the decree shall lapse and thing returned to Decree Holder. If the "Judgment Debtor-LAO"  chooses he may apply for revised decree, in accordance with compensation provided under 2014 act.

The "Judgment Debtor-LAO" cannot say that he had deposited the amount in his treasury account and he has "illegally taken possession" without paying money to the Decree Holder. This will further mean, that in all Money Decrees, the Judgment Debtors will say that "payment of decretal amount doesn't mean Decree holder should receive the decretal amount". Thus it will mean that even execution of Money Decree under Order 21 of CPC will be barred.

D. In the above context let us understand the provision of section 18, & 31, 34 of LAA1894

[i] When a money decree is passed, the judgement debtor shall before he takes possession of the "thing" under the decree pay the decretal amount to the Decree Holder.

[ii] If the decree holder refuses to receive the decreetal amount he shall not be entitled to file Appeal against the amount of Decree.

[iii] The Decree Holder shall file appeal within 42 days of passing of decree.

So clearly it is duty of the "Judgment debtor-LAO" to pay the decretal amount, before taking possession. If Judgment Debtor fails to pay the Decreetal amount he has himself disobeyed the decree. Further if he takes possession without payment of decreetal amount[or say that it is in his treasury account], he has taken illegal possession.

Thus the "Judgment Debtor-LAO" cannot claim that he is in possession when he has not paid the decretal amount

1. s/34 of LAA1894 doesn't change the liability of the LAO, on the contrary it confirm that the LAO has failed to comply with his liability. Thus there cannot be any rules under s/55 to unilaterally expunge this liability of LAO. Needless to say not rules can override specific provisions of law. Further the legislative intent to pay compensation to claimant "at the first instance" before possession is taken, cannot be expropriated/overridden by whimsical rules. There is no statutory liability on the claimants to run after the LAO to get compensation, on the contrary there is statutory liability on the LAO to pay the compensation to the claimants before he takes possession.
2. In para 47 and 48 - IDA2018 holds that, court should not supply words, while contrarily holding "treasury payment" is deposit and also adding practical difficulties, impossibilities to aid the LAO.
3. Allowing statement or interpretation [as is implied by IDA2018] that compensation is not necessary to be paid within the time limit of s/34, r/w 18, of 1894 Act, is violative of art/300A.
4. Making "Credit Account" in name of claimants without their consent is [a] impersonation, [b] abets laundering and infringes right of the claimant under art/21. [c] Same as adhar abuse. [d] violation of Banking Regulation Act as no person other than the person himself can open a bank account, with all details, age, address, PAN details, of the claimant, his nominee etc. {these credits account are "Accounts of Comfort" }
5. If the HC/SC has held that the LAO has not performed his part under section 4 to 11A of the 1894Act, and held process void, and yet the LAO makes award, then he has made award without jurisdiction, and is contempt too. And if the award itself is held by HC/SC to be illegal because the LAO has not performed his part under section 4 to 11A of the 1894Act; there is clearly no award. And in both these case s/24(1)(a) of 2013 Act apply.
6. Most important question is "had the PMC2014 judgment not been there, would it be correct to say that "no other SC bench would have decided it, whichever way?"".
7. The IDA2018 page 66 has set aside the SC judgment {1994 AIR SCW 2459} whereunder filling of the Land Reference is deemed protest u/s/34(2) r/w 18 of 1894 Act.
8. The concept of payment of wages cannot be compared with expropriatory statute, where claimant loss their land and money. The reliance on judgment of SC on Income Tax is misconceived and misapplied where the issue was "Accrued Income" in computation of Income. Further it was in respect of tax liability of assesse under the provision of "accrued income", for PAYING tax. Further it has to be noted that the court held that it is an income, and assessee was directed to "PAY" the tax. There is nothing called "Accrued Payment" of Tax.
9. No Govt or Court can stale a claim of the person, except by law. To stale a claim will imply that there is no RULE OF LAW, and ours is "POLICE STATE". Further if a claim in engulfed/revived by Act of Parliament, [24(2) claimants who have not received compensation prior to 5 year] it cannot be taken away.
10. Since in land acquisition the provisions of state contracts u/art299 are in play, to be read with 300A, there is no question of application of art/283. Also this admits a conclusion, that, money will not be paid to claimants and will be retained by state. Thus, this also falls in trapping of section 24 as "not paid".
11. The observations on page 66 para 66 that "claimants are NOT supposed to know their right to file Land Reference" appear beyond the principle of access to justice and Legal Literacy to seek Justice in Civil manner. The apathy / apprehension of being shutting out, has lead to many extremism in our country.
12. The assumption in para 69 itself admits doubt, as to where the amount is to be deposited. The statement in this para that "every infarction of law would not vitiate the act" is against the principle of rule of Law, and there will be anarchy.
13. The IDA2018 has failed to "interpret section 24 of 2013" and the end intent thereof. Theories of Vesting, application of s/6 GCA is misapplied. The IDA interprets 1894 Act and imposes it on s/24 of 2013 act; whereas plain reading shows that s/24 of 2013 Act controls 1894 Act, and wherever 1894 act comes in conflict with s/24 of 2013 Act, it is overridden.
14. Theories of impossibility/difficulty will bring in chaos, anarchy, mockery, corruption and uncertainty in discharge of "public function". No court can allow public officers "not to perform" their public function. If such officer makes such a plea they should be dismissed as there are many intelligent and capable people in India. A LAO claiming impossibility admits that he has made award which is "impossible to implement", and thus void under section 29, 36 of Indian Contract Act too.
15. There are several scenario of refusal or to take compensation under protest by claimants: [a] the provisions of section 15 r/w 23 and 24 [b] area mismatch, [c] calculation errors [d] misapplication of factors and head of compensation.
16. Right of judicial review u/art32/226/227 is basic structure of constitution. A Petition seeking judicial review to check constitutionality of action of public authority, doesn’t take away civil right of claimants under local laws. So reliance on actus curia is unconstitutional. Further if the LAO is so unimpeachable, he should perform all his duty apty and timely. 

In Hope of Certain and Better Bharat
"Where is Sujalam Suphalam"? - Why Anarchy?