Holding

The Collector has no power to allot land in lieu of compensation; any such award is a nullity and cannot be executed.

Summary

The Government of Rajasthan acquired land for the development of Jaipur city under the Rajasthan Land Acquisition Act, 1953. After an initial award excluded a portion of the land, the Land Acquisition Officer made a 1974 award that deducted compensation by allotting portions of the acquired land to the respondents in lieu of monetary payment. The Development Authority challenged the executability of this award, arguing that the Collector had no statutory power to allot land in lieu of compensation, rendering the award a nullity. The High Court rejected the objection and allowed execution, but the Supreme Court examined the scope of Sections 11, 31(3) and 31(4) of the Act. It held that the Collector's authority is limited to determining compensation and cannot create an encumbrance by granting acquired land in lieu of compensation. Consequently, any award directing such allotment is void and cannot be executed under Section 26(2). The Supreme Court set aside the execution decree and allowed the appeals.

Issues considered

Whether the Land Acquisition Officer (Collector) has jurisdiction under the Rajasthan Land Acquisition Act to allot acquired land or any other land in lieu of compensation.
Whether an award directing allotment of land in lieu of compensation is executable under Section 26(2) of the Act.
Whether an objection to such an award can be raised at the execution stage.

Legislation cited

Land Acquisition Act, 1894s. 11, s. 18, s. 26(2), s. 31(3), s. 31(4)
Rajasthan Land Acquisition Act, 1953s. 11, s. 18, s. 26(2), s. 31(3), s. 31(4), s. 4(1), s. 48

Subjects

land acquisitioncompensationallotment in lieujurisdictionnullityexecution decreeSection 31public purpose

Judgment

~

JAIPUR DEVELOPMENT AUTHORITY A
' v.
RADHEY SHYAM AND ORS.
j
~ FEBRUARY 17, 1994

[K. RAMASWAMY AND N. VENKATACHALA, JJ.] B
'
Land Acquisition Ac4 1894: Sections 11, 18, 31(3) and (4):

Land Acquisition Of/icer/Collectm--l'ower to allot land in lieu of
<compensation for acquired land-Held Collector has no power to allot land c
under acquisition in lieu of compensation-Award gra11ting land in lieu of
compensation held nullity-Objectio11 to such an award could be raised at
execution stage.

The Government of RllJasthao issued a Notification dated June 9,
1960 under section 4(1) or the Rltjastban Land Acquisition Act, 1953 D
acquiring 552 Bigbas and 8 Blswas of land for planned development of
Jaipur city. Later by an award dated January 9, 1961 land belonging to one
C was excluded. The respondents purchased part of the land from C.
Subsequotly, the Land Acquisition Officer made an award on January 21,
1974 deducting the value or lb. 2131.68 towards the value or land allotted
to each or the respondents lo lieu of compensation awarded to them. lo
E
the reference made under Section 18 of the Land Acquisition Act, 1894, the
Civil Court confirmed the award or the Land Acquisition omcer but
corrected certain double deduction of certain amounts made therein.
Thereafter, some persons flied writ petitions for grant or land lo lleu or
~ compensation and the respondents flied an execution to enforce the award F
1! of the Civil Court. The appell6nt·Development Authority raised objection
as to the executablllty or the award for allotment of the sites made lo lleu
'• or compensation. The Execution Court pal11y upheld that objection but,
on revision by Respondents the Division Bench or the High Court held that
It was not permissible for the appellants to raise the objection execution
or the award.
G
~

Io appeals to this Court It was contended on behalf of the appellant•
Development Authority that the Land Acquisition Officer bad no jurlsdlc-
""" tioo to allot part of the acquired land, lo lieu of compensation add that,
therefore, the award to that extent was a nullity; objection to which could H
1
2 SUPREME COURT REPORTS (1994) 2 S.C.R.

A be raised at any stage Including execotioo of that award.
For the respondents it was contended that (i) under Section 31(4) of
the Land Acquisition Act, the Land Acquisition Officer had power to enter
into an arrangement with the land owners which power is without any
t
ilmltatlon though similar limitation was found In sub-Section (3) of Sec·
B tlon 31. Therefore, the award directing allotment of the Jand In lieu of
compensation was perfectly legal; and (Ii) having allowed the award to ..
become final, It was not open to the appellants to raise the contention of r

lack of Jurisdiction or nullity of the award of the Collector on the execution
side.
c Allowing the appeals, the Court

HELD : 1. In the scheme of the Act, the Laud Acquisition Officer has
no power to create an encumbrance or right in the erstwhile owner to claim
possession of a part of the acquired land lo lieu of compensation. Such
D power of the Land Acquisition Officer If Is exercised would be self defeating
and subversive to public purpose. [7-D)

2. A reading of sub-section (4) of Section 31 lodlcates that the Land
Acquisition Officer bas DO power Or Jurisdiction to give any land under
acquisition or any other land In lieu or compensation. Sub-section (4)
E though gives power to him lo the matter or payment of compensation It
does not empower him to give any land lo lieu of compensation. Sub-sec·
tloo (3) expressly gives power "only to aUot any other land In exchaou".
lo other words, the land under acquisition Is not liable to be allotted in lieu
of c6mpeosatlon except under Section 31(3), that too only to a person
~
having limited loteresL [6-G, HJ
F
2.1. It Is not correct to say that while awarding compensation the
Collector has a higher pOMr than the limited power given under sub-sec·
tloo (3) of Section 31 because It would run counter to the scheme envisaged
thereunder and would result In defeating the public purpose. [7·Al
G
3. Section 11 excludes by implication any power other than that given
to the Collector by Section 11. [S·E)

4. What is executable Is only an award under Section 26(2) namely,
the amount awarded or the claims of the Interests determined or the
H respective persons lo the acquired lands. Therefore, the decree cannot
DEVELOPMENT AUTI!ORITY v. RADHEY SHYAM 3

,
.
Incorporate any matter other than the matters determined under Section
11 or those referred to and determined under Section 18 and no other•
A
Since the Land Acquisition Officer bas no power or jurisdiction to allot
land in lieu of compensation, the decree even, if any, under Section 18 to
' the extent of any recognition of the directions In the award for the allot·
ment of the land given under Section 11 is a nullity. It Is open to the
appellant to raise the invalidity, nullity of the decree In execution in that
B
behalf. Accordingly, the execution proceeding directing delivery of posses-
sion of the land as contained In the award is, invalid, void and inex-
ecutable. It Is set aside. (7-F-H]

CIVIL APPELLATE JURl!>DICTION : Civil Appeal Nos. 4209 and c
4210 of 1992.

From the Judgment and Order dated 20.12.91 of the Rajasthan High
Court in S.B.C.R. Nos. 646/90 & 591 of 1991.

' Aruneshwar Gupta for the Appellant. D
~
H.N. Salve, Atul Y. Chitale, Ravikesh Sinha, J.R. Grover, Ashok
Sharma and Mrs. Suchitra A. Chitale for the Respondents.

The following Order of the Court was delivered :
E
These appeals arise from the order of the High Court of Rajasthan
at Jaipur Bench dated December 20, 1991 made in Civil Revision Petition
Nos. 591/91 and 646/90. The facts lie in a short compass. The Government
of Rajasthan exercising the power under Sec. 4(i) of the Rajasthan Land
-< Acquisition Act, 1953 for short 'the Act' published on June 9, 1960 to F
acquire 552 Bighas and 8 Biswas of land at village Bhojpura Chak Suder-
shanpura, which is now part of Jaipur city, for planned development of that
city. An award made on January 9, 1961 excluded 4 bighas, 1 biswas of land
belonging to one Chotelal. Subsequently the Land Acquisition Officer
made an award on January 21, 1974 after respondents Radhey Shyam,
Naval Kishore and Shyam Sunder had purchased a part of the land from G
Chotelal by registered sale deed. In that award the Land Acquisition
Officer deducted the value of Rs. 2131.68 towards the value of 266.6 sq.
yards of land allotted to each of the Respondents in lieu of compensation
awardable to them. The possession of the acquired land was taken on
December 2, 1980 and it was handed over to the appellant • Jaipur H
4 SUPREME COURT REPORTS [1994] 2 S.C.R.
A Development Authority. In the reference made under Sec. 18, the Civil
Court confirmed the award of the Land Acquisition Officer but corrected
,.. .
certain double deduction of certain amounts made therein. Thereafter
some persons filed writ petitions for grant of land in lieu of compensation
and the respondents filed an execution to enforce the award passed by the •
B Civil Court on the reference under Sec. 18. The appellant raised an
objection as to the executability of the award for allotment of the sites
made in lieu of compensation. The Executing Court partly upheld that
objection but on revision by Respondents the Division Bench held that it
was not permissible for the appellants to raise the objection in execution
of the award and accordingly allowed tberevision. Thus these appeals by
C Special l~ave.

The contention of the appellants is that the Land Acquisition Officer
had no jurisdiction to allot part of the acquired land, in lieu of compensa-
tion and that, therefore, the award to that extent was a nullity, which
D objection could be raised at any stage including in execution of that award ,
as upheld by the Civil Court.

Shri Harish Salve, learned senior counsel appearing for the respon-
dents contended that tinder Sec. 31(4) of the Act, the Land Acquisition
Officer had power to enter into an arrangement with the, land owners which
E power is without any limitation, though similar limitation was found in
Sub-s. (3) of Sec. 31. Therefore, the award direciing allotment of the land
in lieu of compensation was perfectly legal. Having allowed the award to
become final, it is no longer open to the appellant to raise the contention
of lack of jurisdiction or nullity of the award of the Collector as affirmed
F by Reference Court, on the execution side. He further contended that it
was the policy of the Government to allot the plots in lieu of compensation
and it was allowed in respect of others. The respondents having foregone
the right to receive compensation in respect of those lands, it is no longer
open to the appellant to contend that the Land Acquisition Officer had no
power to allot lands in lieu of compensation.
G
Having considered and given our anxious consideration to the con-
tentions of learned counsel on either side, the question which emerges is,
whether the Collector had power under any provision of the Act to award
land in lieu of compensation from the acquired lands or any other lands.
H His power is traceable to Section l1 of the Land Acquisition Act. He is
DEVEWPMENT AU1110RITY v. RADHEY SHYAM s
requir~.d to enquire into matters mentioned therein to determine the A
) market value thereof and to make the award. Section 11 postulates that the
Collector shall proceed to enquire into the objection which aiq person
interested in the land may make to (I) the measurement of the land
acquired or (II) respective interests of the persons claiming the compen-
sation and he shall make the award as to :
B
(i) the true area of the land;

(ii) the compensation which in his opinion should be allowed for
the land; and

(iii) the apportionment of the said compensation among all the c
persons known or believed to be interested in the land, of whom,
or on whose claims, he has information whether or not they have
respectively appeared before him.

Therefore, the power expressly given to the Land Acquisition Officer D
is only in respect of enquiry into the true area of the land acquired and
determination of the compensation which in his opinion should be allowed
to the acquired land and to apportionment of the compensation among the
claimants who appeared before him or persons known or believed to be
""\ interested in the land whether appeared or not. It excludes by implication
any power other than that given to the Collector by Section 11. The award E
is anly an offer of the above matters. On making an award under section
12(2), the Collector shall give a notice of his award to the persons inter-
ested who are not personally present or represented through their counsel
at the time of making the award Under Section 18 any person interested
an who had not accepted the award may, by written application to the F
'"" Collector, require him to make a reference with respect to (I) the meas-
urement of the land or (II) the amount of compensation, (III) the person
to whom it is payable or (IV) the apportionment of the compensation
ainong the persons interested. On reference so made the Civil Coui:t is
enjoined to enquire, as court of Original Jurisdiction, into the questions so
referred. The claimants, .the Collector and the person interested are en- G
titled to adduce evidence in proof or disproof of the referred questions
and the civil court needs to decide those questions and no more. On
reference and determination made under sub-s.(l} of Sec. 23 of the
"" ainounts awardable thereunder or any other ainount awarded under any or
all other clauses thereunder including sub-s.(2), an award shall be made by H
6 SUPREMECOURTREPORTS [1994) 2 S.C.R.

A Court. Such award by operation of sub-s(2) of Section 26 shall be deemed
. to be a decree and the statement of the grounds of every such award a (

judgment within the meaning of Sec. 2 clause (2) and ~ec. 2 clause (9)
· respectively of the Code of Civil Procedure.

After making the award under Section ll the Collector shall tender
B payment of the compensation awarded by him to the persons interested
and entitled thereto according to the award, and shall pay it to them unless
prevented by someone or more of the contingencies mentioned in sub-s.
(2) and the proviso with which we are not concl!rned. Sub-s. (3) gives an
indication of the powers of the Collector in awarding any other land in
c exchange and in lieu of the payment. of compensation, namely, not-
withscanding anything in Sec. 31 the Collector may, with the sanction of the
appropriate Government, instead of awarding a money compensation in
respect of any land, he may made any arrangement with any person 'having
a limited interest i11 sueIt /a11d', either by grant of other land in exchange,
the remission of the land-revenue, or other such lands held under the same
D title, or in such other way having· regard to the interest of the parties
concerned. Sub-s. (3) lifts the rigour of payment under sub-s. (1) and (2)
of Sec. 31 and gives power to the Collector, that too, with the prior sanction
of the appropriate Government, that instead of awarding moeny compen-
sation in respect of the acquired land, he. could make any arrangement with
E the person who is having only a limited interest in the land under acquisi-
tion and grant him either any other land in exchange to the land acquired
or remittence of the land revenue on other lands held by the land owner
or in some other way as may be equitable, having regard to the interest
held by the limited owner. Sub-s. (4) provides that nothing in this iast
F sub-section i.e. sub-s. (3) shall be construed as interfering with or limiting .-
the power of the Collector to enter into any arrangement with any person
interested in the land and competent to contract in respect thereof.

A reading of sub-section (4) of Section 31, in our considered view,
indicates that the Land Acquisition Officer has no power or jurisdiction to
G give any land under acquisition or any other land in lieu of compensation.
Sub-section (4) though gives power to him in the matter of payment of
compensation, it does not empower him to give any land in lieu of com-
pensation. Sub-s.(3) expressly gives power 'only to allot any other land in
exchange'. In other words the land under acquisition is not liable to be
H allotted in lieu of compensation except under section 31(3), that too only
DEVELOPMENT AU1HORITY v. RADHEYSHYAM 7

to a person having limited interest. If the contention of the learned counsel A
for the respondents, that while awarding compensation the Collector (Land
Acquisition Officer) has a higher power than the limited power given under
sub-section (3) of Section 31, it would run counter to the scheme envisaged
thereunder and would result in defeating the public purpose. The problem
could be looked at from a different angle. Under section 4(1), the ap- B
propriate government notifies a· particular land needed for public purpose.
On publication of the declaration under section 6, the extent of the land
with specified demarcation gets crystalised as the land needed for a public
purpose. If the enquiry under section 5A was dispensed with, exercising
the power under section 17(i), the Collector on issuance of notice under
sections 17, 9 and 10 is entitled to take posser,sion of the acquired land fur C ·
use of public purpose. Even otherwise on making the award and offerring
to pay compensation he is empowered und0• scdion lb, lo take possession
of the land. Such land vests in the Government free from all encumprances.
The only power for the Government under section 48 is to denotify the ·
lands before possession is taken. Thus,' In the scheme of the Act, the Land D
Acquisition Officer has no power to create an encumbrance or right in the
erstwhile owner to claim possession ~f a part of the acquired land in lieu
of compensation. Such power of the Land Acquisition Officer if is exer-
cised would be self-defeating and subversive to public purpose.

The question then is, whether it is open to the appellant to raise the E
objections on the execution side as to allotment of acquired land under the
award. We have already said thal what is executable is only an award under
Sec. 26(2), namely, the amount awarded or the claims of the interests
determined of the respective perscns in the acquired lands. Therefore, the
decree cannot Incorporate any matter other than the matters determined F
under Section 11 or those referred to and determined under Section 18
and no other. Since we have already held that the Land Acquisition Officer
has no power or jurisdiction to allot land in lieu of compensation, the
decree even, if any, under section 18 to the extent of any recognition of the
directions in the award for the allotment of the land given under Section
11 is a nullity. It is open to the appellant to raise the invalidity, nullity of G
the decree in execution in that behalf. Accordingly we hold that the
execution proceedings directing delivery of possession of the land as con-
tained in the award is, invalid, void and inexecutable. Accordingly it is set
aside.
H
8 SUPREME COURT REPORTS [1994) 2 S.C.R.

A It is stated tha! Government has formulated a policy to allot any
other suitable site to the displaced persons and a request is made to give
suitable directions. No such policy has been brought to our notice. There-
fore, we cannot give any such specific directions. It is also stated that some
other properties were allotted to others, in pursuance of the directions
issued by the Collector in the award dated January 9, 1994. It is stated by
B the learned counsel for the appellant that appeals have been filed in this
court and all the matters are pending and no one is allowed to have the
benefit under the awards. In view of such statement we cannot give any
specific direction for allotment of sites.

C Appeals are accordingly allowed bul'the parties are directed to bear
their own costs.

T.N.A. Appeals allowed.