Delhi Development Authority vs. Godfrey Phillips (I) Ltd. & Ors.
Background
Land in Delhi was notified for acquisition back in 1980, and the acquisition award was declared in 1987. Long after this, in 1991, Godfrey Phillips (I) Ltd. purchased part of that already-acquired land from the original owners. Decades later, the company approached the Delhi High Court claiming that under Section 24(2) of the 2013 land acquisition law, the acquisition should be treated as having "lapsed" because possession had allegedly not been fully taken and compensation not paid. The High Court ruled in the company's favour and DDA appealed to the Supreme Court.
Decision Breakdown
The Supreme Court allowed DDA's appeal and set aside the High Court's ruling. It held that a person who purchases land after it has already been notified/acquired (and especially after the government has taken possession) does not step into the shoes of the original landowner and cannot claim the benefit of "lapsing" under Section 24(2) of the 2013 Act: that right belongs only to the original landowners as of the acquisition notification date. The Court also found on facts that possession of most of the land had genuinely been taken and compensation deposited, so the twin conditions for a "lapse" were not met. The Court did direct DDA to refund a specific voluntary deposit made by the purchaser, without interest.
Lesson Learnt
Buying land that has already been through government acquisition proceedings is legally risky: a subsequent purchaser generally cannot reopen or challenge the acquisition or claim it has lapsed; only the original landowner (as of the acquisition notification) holds that right.