Delhi Development Authority vs. Asha Jain & Ors. (2022 INSC)

Civil Appeal · 2022 INSC 1190Decided 9 Nov 2022
Civil Appeal No. 8088 of 2022
M.R. Shah · M.M. Sundresh

Background

Land in South Delhi (originally recorded in the name of a company, M/s. Laxmichand Bhagaji Ltd.) had been acquired by the government in 1980 for the planned development of Delhi, and possession was taken over in 2005. The respondent, Asha Jain, claimed rights in the land through an Agreement to Sell dated 09.05.2005 and filed a writ petition arguing that the acquisition had lapsed under Section 24(2) of the 2013 Land Acquisition Act because compensation had not been paid to the recorded owners. The Delhi High Court, relying on the then-existing precedent in Pune Municipal Corporation vs. Harakchand Misirimal Solanki, allowed the writ petition and declared the acquisition lapsed. DDA appealed to the Supreme Court.

Decision Breakdown

The Supreme Court allowed DDA's appeal and set aside the High Court's order. It held that the Pune Municipal Corporation judgment relied on by the High Court had since been overruled by a five-judge Constitution Bench in Indore Development Authority vs. Manoharlal (2020), which clarified that acquisition proceedings do not lapse under Section 24(2) merely because compensation was not deposited in court, so long as possession had already been taken. Since possession of the land was admittedly taken in 2005, there was no lapse. Separately and independently, the Court held that the respondent was only a subsequent purchaser under an Agreement to Sell (which by itself confers no title), and settled law (including the DDA vs. Godfrey Phillips and Shiv Kumar precedents) holds that a subsequent purchaser has no legal standing to claim that acquisition proceedings have lapsed, only the original recorded owner would have such standing. On both grounds, the writ petition should never have succeeded.

Lesson Learnt

A person who buys land only under an unregistered Agreement to Sell after it has already been acquired by the government does not acquire ownership rights and cannot later claim that the acquisition has "lapsed" for non-payment of compensation: that right belongs only to the original recorded landowner, and once possession has been taken by the authorities, non-payment of compensation alone does not revive or lapse the acquisition.

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