Manubhai Sendhabhai Bharwad vs Oil And Natural Gas Corporation Ltd.

REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. OF 2023 (Arising from S.L.P.(Civil) No. 13885/2022)

Manubhai Sendhabhai Bharwad and Another …Appellants

Versus

Oil and Natural Gas Corporation Ltd. & Others …Respondents

JUDGMENT

M.R. SHAH, J.

1. Leave granted.

2. Feeling aggrieved and dissatisfied with the impugned judgment

and order dated 26.04.2022 passed by the High Court of Gujarat at

Ahmedabad in SCA No. 9258/2021, by which the High Court has

dismissed the said writ petition preferred by the appellants – original writ

petitioners for quashing temporary acquisition proceedings, the original

writ petitioners – landowners have preferred the present appeal. Signature Not Verified Digitally signed by Neetu Sachdeva

3. Date: 2023.01.20 16:12:12 IST Reason: That the land bearing survey No. 837/1 situated at Village Vastral,

Taluka Vatva, District Ahmedabad admeasuring 10034 square meters is

1 under temporary acquisition by Oil and Natural Gas Corporation Ltd.

(ONGC) since the year 1996 for the purposes of oil exploration, which

land was undisputedly purchased by appellant No.1 under a registered

sale deed dated 15.03.2005. It is required to be noted that as such now

the land in question falls in the city of Ahmedabad and it cannot be

disputed that the prices of the land have increased manyfold and even

the surrounding lands are already developed. At present, the appellants

are being paid the rent at the rate of Rs. 24/- per square meter per

annum for temporary acquisition.

3.1 That the appellants herein approached the High Court in the year

2016 by way of SCA No. 3992/2016 seeking a direction to the

respondents to either acquire the land on permanent basis or release the

land from acquisition. The said writ petition came to be disposed of vide

order dated 23.02.2017 on the stand taken by the respondents that they

will initiate the process for acquiring the land permanently. However

thereafter no concrete steps were taken to acquire the land permanently.

On the contrary, ONGC approached the Special Land Acquisition

Officer/Collector. The Land Acquisition Officer addressed a

communication to the Deputy Collector that there shall be huge cost

involvement in acquiring the land on permanent basis under the new

Land Acquisition Act, 2013. However thereafter the acquisition

proceedings were kept on hold and the appellants continued to be paid

2 the rent @ Rs. 24/- per square meter per annum for temporary

acquisition. That after the disposal of the writ petition in 2017 and

though it was assured that the process for permanently acquiring the

land would be initiated, nothing was done thereafter and therefore the

appellants again approached the High Court for quashing of the

acquisition proceedings and to direct the respondents to release the said

land from temporary acquisition and to handover vacant and peaceful

possession of the land in question to the appellants.

3.2 It was the case on behalf of the appellants that to continue the

temporary acquisition for nearly 25 years would be absolutely

unreasonable and arbitrary and that too by paying abysmally low rent. It

was pointed out that in the neighbouring area, Ahmedabad Metro Rail

Corporation is paying Rs. 1000/- per square meter per month as rent

whereas now the rate of rent fixed for the subject land is Rs. 30/- per

square meter per annum.

3.3 In response to the notice issued by the High Court, the

respondents appeared before the High Court. It was again submitted

that the competent authority has accorded approval for acquisition of the

subject land on permanent basis and the same is under process. A

statement was made on behalf of the ONGC before the High Court that

the acquisition proceedings would be concluded within 12 months. An

undertaking on behalf of the ONGC was also placed on record. Relying

3 upon the said undertaking, the High Court, by the impugned judgment

and order, has rejected the prayer for quashing temporary acquisition

proceedings. However, taking note of the fact that the Corporation made

a show of having paid enhanced rent from Rs. 24/- per square meter per

annum to Rs. 30/- per square meter per annum, which can be said to be

abysmally on the lower side and not commensurate with the prevalent

market rent and the statutory authorities of the State under similar

circumstances having paid Rs. 1,000/- per square meter per month, the

High Court has directed that the Corporation would consider the claim of

the appellants for paying rent at Rs. 1,000/- per square meter per month

till acquisition of the land on permanent basis from the date of purchase

of the land by the appellants i.e., from 15.3.2005.

3.4 Feeling aggrieved and dissatisfied with the impugned judgment

and order passed by the High Court refusing to quash the temporary

acquisition proceedings and as such not passing any order to increase

the rent per month for temporary acquisition, the landowners have

preferred the present appeal.

4. Shri Gopal Sankaranarayanan, learned Senior Advocate

appearing on behalf of the appellants – landowners has vehemently

submitted that to continue the temporary acquisition for number of years,

namely, in the present case, twenty five years and that too on payment

of a meagre rent per annum is nothing but arbitrary, unreasonable and

4 violative of right to hold property guaranteed under Article 300A of the

Constitution of India.

4.1 It is submitted that even in the year 2016, an assurance was given

to the High Court that to acquire the land permanently, proceedings shall

be initiated and on that assurance the High Court disposed of the earlier

writ petition. It is submitted that thereafter also, after a period of six

years, no further concrete steps are taken to acquire the land

permanently and the appellants are being paid meagre rent at present at

the rate of Rs. 30/- per square meter per annum.

4.2 It is further submitted that the area in question in which the land

under temporary acquisition is situated is now forming part of the city

area and is a fully developed area and the prices have gone very high.

It is submitted that therefore to offer/pay rent at the rate of Rs. 30/- per

square meter per annum and that too for the entire area of the land in

the developed area is absolutely unreasonable, arbitrary and violative of

Article 300A of the Constitution of India. It is submitted that because of

the temporary acquisition for 25 years, the appellants are not in a

position to use the land in question. They are not in a position to fetch

the market price. They are also not getting the adequate

compensation/rent. It is submitted that if the land would have been

acquired permanently earlier, the appellants would have got sufficient

compensation and the appellants would have utilised that money for

5 purchase of other land, which the appellants could not because of non-

payment of compensation due to non-acquisition of the land

permanently.

5. Shri Vikramjit Banerjee, learned Additional Solicitor General of

India has submitted that the land in question has been acquired by the

ONGC for its oil exploration and production activities on temporary basis.

It is submitted that for the aforesaid the landowners are being paid the

annual rent revised from time to time by the Committee comprising

Collector, Town Planning Officer, Deputy Collector, Assistant Collector,

Special Land Acquisition Officer and the representative of the ONGC

with respect to the land situated in Gujarat. It is submitted that the

appellants are accepting the periodically revised upward rent voluntarily.

5.1 It is further submitted that after the High Court passed an order in

Special Civil Application No.3992/2016, which was disposed of on the

statement made by the respondents that they would initiate the process

of permanent acquisition, on 23.5.2018, Revenue Department,

Government of Gujarat published a notification stating that the land in

question is required by the ONGC for public purpose declaring its

intention to acquire the land for development of its infrastructure. It is

submitted that after the notification dated 23.5.2018, again on

22.07.2019, Revenue Department of Government of Gujarat published a

notification relating to land in question required by the ONGC for public

6 purpose, the same was issued under Right to Fair Compensation and

Transparency in Land Acquisition , Rehabilitation and Resettlement Act,

2013 (hereinafter referred to as the ‘2013 Act’). It is submitted that

however thereafter on 21.10.2019 through internal communication,

GM(HR) I/c LAQ Section, ONGC, Ahmedabad was informed that the

permanent acquisition of the land in question is put on hold and the

proposal detailing number of acquisition to be made at Ahmedabad

Asset, including its financial implications have been sent for appraisal to

the Executive Committee/ONGC Board. It is submitted that therefore the

respondent-ONGC has full intention to proceed with the permanent

acquisition, but due to the reasons so stated in the letter dated

21.10.2019, the process for permanent acquisition was put on hold. It is

therefore submitted that the respondent-ONGC needs more time to

make the acquisition process in conformity with 2013 Act, to acquire the

land permanently.

5.2 Now so far as the grievance on behalf of the appellants that they

are being paid meagre annual rent is concerned, it is submitted that as

such In-house Executive Committee of the ONGC revises the rate after

every three years. It is submitted that the rate of rent is revised recently

as well with effect from 1.2.2021 from Rs. 24/- per square meter to Rs.

30/- per square meter for the lands acquired directly by ONGC on

temporary basis. It is submitted that periodical upward rent is accepted

7 voluntarily by the appellants. It is submitted that the appellants again

claiming the annual rent/revision of annual rent considering the market

value/market price of the land in question.

6. We have heard learned counsel for the respective parties at

length.

At the outset, it is required to be noted that the land in question

owned by the appellants has been under temporary acquisition by the

respondent-ONGC since the year 1996 for the purposes of its oil

exploration. The land in question has been purchased by the first

appellant under a registered sale deed dated 15.3.2005. Therefore, as

such, at the time when appellant No.1 purchased the land in question,

the land in question was under temporary acquisition by the ONGC. Be

that as it may, on and from 15.3.2005, appellant No. 1 is the owner of

the land in question and therefore can question the temporary

acquisition if the temporary acquisition has been continued for a long

period. It is to be noted that the land in question now falls in the city of

Ahmedabad and the prices of the land have increased manyfold. The

appellants are being paid the annual rent @ Rs. 30/- per square meter

per annum as revised.

As observed hereinabove, the land in question is under temporary

acquisition by the ONGC since the year 1996 for its oil exploration. The

same is under temporary acquisition under Section 35 of the Land

8 Acquisition Act, 1894 (for short, ‘1894 Act’). Section 35 of the 1894 Act

reads as under:

“35. Temporary occupation of waste or arable land, procedure when difference as to compensation exists – (1) Subject to the provisions of Part VII of this Act, whenever it appears to the appropriate Government that the temporary occupation and use of any waste or arable land are needed for any public purpose, or for a company, the appropriate Government may direct the Collector to procure the occupation and use of the same for such terms as it shall think fit, not exceeding three years from commencement of such occupation.

(2) The Collector shall thereupon give notice in writing to the persons interested in such land of the purpose for which the same is needed, and shall, for the occupation and use thereof, for such term as aforesaid, and for the materials (if any) to be taken therefrom, pay to them such compensation, either in a gross sum of money, or by monthly or other periodical payments, as shall be agreed upon in writing between him and such persons respectively.

(3) In case the Collector and the persons interested differ as to the sufficiency of the compensation or apportionment thereof, the Collector shall refer such difference to the decision of the Court.”

7. Approximately 26 years have passed and still the land in question

is under temporary acquisition by the ONGC. If the land is continued to

be under temporary acquisition for number of years, meaning and

purpose of temporary acquisition would lose its significance. Temporary

acquisition cannot be continued for approximately 20 to 25 years. It

cannot be disputed that once the land is under temporary acquisition and

the same is being used by the ONGC for oil exploration, it may not be

possible for the landowners to use the land; to cultivate the same and/or

to deal with the same in any manner. To continue with the temporary

acquisition for number of years would be arbitrary and can be said to be

9 infringing the right to use the property guaranteed under Article 300A of

the Constitution of India. Even to continue with the temporary acquisition

for a longer period can be said to be unreasonable, infringing the rights

of the landowners to deal with and/or use the land.

However, from the material on record, it appears that in the year

2018 and after the High Court disposed of the earlier writ petition on the

submission made on behalf of the ONGC that the land in question shall

be acquired permanently, efforts were made in the year 2018 to acquire

the land under the provisions of the 2013 Act. However, thereafter the

same is put on hold by the Land Acquisition Officer/State Government

and the reason seems to be the higher value of the land to be paid

towards compensation. Even before this Court also, learned counsel

appearing on behalf of the ONGC has prayed for some further time to

acquire the land in question permanently. As such, in the impugned

judgment and order, the High Court has granted time to the ONGC and

the State to acquire the land in question permanently within twelve

months from the date of the impugned order, i.e., within twelve months

from 26.04.2022, i.e., on or before 26.04.2023. Therefore, as such, a

writ of mandamus is already issued by the High Court directing the

Corporation ONGC to complete the acquisition proceedings on or before

26.04.2023. Therefore, if the land in question is not acquired as per the

writ issued by the High Court within a stipulated time, necessary

10 consequence shall follow. The respondent-ONGC is directed to act as

per the impugned judgment and order passed by the High Court, more

particularly para 7(ii), failing which necessary consequence shall follow.

8. Now so far as the grievance with respect to the quantum of annual

rent paid is concerned, the High Court has already issued directions in

terms of para 7(iii) of the impugned judgment and order. Even otherwise,

as per section 34 of the 1894 Act, if the appellants are aggrieved by the

amount of compensation/annual rent, it will always be open to the

appellants/landowners to approach the Collector and the Collector shall

refer such reference to the decision of the Court.

9. With the aforesaid observations and directions, the present appeal

stands disposed of in terms of the above.

………………………………….J. [M.R. SHAH]

NEW DELHI; ………………………………….J. JANUARY 20, 2023. [M.M. SUNDRESH]

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