Holding

The Government cannot acquire its own interest and, being barred from a Section 18 reference, is likewise ineligible to seek a Section 30 reference for apportionment of compensation.

Summary

The Union of India (respondent) had taken over property for war purposes and later agreed to acquire it, resulting in a compensation award. The Union later sought to withdraw from the acquisition and to set aside the award, which was denied, and subsequently applied for apportionment of its share under Section 30 of the Land Acquisition Act. The Bombay High Court allowed this application, directing the Special Land Acquisition Officer to make a reference under Section 30. The Supreme Court held that the Government cannot acquire its own interest and, being barred from filing a reference under Section 18, is also ineligible to invoke Section 30 for apportionment. It further ruled that the Special Land Acquisition Officer had no duty to inquire into a claim that was never raised in the acquisition proceedings and that the Union's claim was barred by res judicata and the reasonable‑time limitation derived from Section 18. Consequently, the High Court order was set aside and the Union’s writ petition dismissed, allowing the withdrawal of the deposited amount.

Issues considered

The Government can acquire its own interest in land under the Land Acquisition Act.
Whether a party barred from filing a reference under Section 18 may file a reference under Section 30 for apportionment of compensation.
Whether the Special Land Acquisition Officer is obligated to investigate a party's interest when no claim was made in the acquisition proceedings.
Whether the limitation period for a Section 30 reference is governed by the period prescribed under Section 18.
The claim for apportionment is barred by the principle of res judicata or analogous principles.

Legislation cited

Land Acquisition Act, 1894s. 11, s. 12, s. 17, s. 18, s. 30, s. 31, s. 3(2), s. 4, s. 50, s. 6

Subjects

Land acquisitionSection 30 referenceApportionment of compensationGovernment interestLimitation periodRes judicataPre‑existing rightTenancyWar purposeWithdrawal from acquisition

Judgment

A MEHER RUSI DALAL
v.
UNION OF INDIA AND ORS.

MAY 5~ 2004

B [S.N. VARIAVA AND H.K.SEMA, JJ.]

Land Acquisition Act, 1894:

Section 30-Reference under-Apportionment of share-By tenants- ,.,.
C Property taken over by Central Government for war purposes-Notice to quit
given to Defence Government-Owner filed writ petition for directions that the
property be acquired or possession be handed back-Central Government
agreed to acquire said property-Certain amount awarded as compensation--
Central Government sought permission to withdraw from acquisition and to
D set aside the award, which was not granted-Subsequently, Central Government
filed a writ petition for apportionment of its share-The High Court allowed
the writ petition and directed the Special Land Acquisition Officer for a
reference under S. JO-Correctness of- Held· In land acquisition proceedings
Government cannot and does not acquire its own interest-The interest which
is acquired is interest of third parties-Hence, High Court erred in directing
E reference under S. 30.
Section 18-Reference under-Period of /imitation-Held: Where the
claimant has notice ofthe acquisition proceedings the limitation period is that
prescribed under S. 18-Where there is no notice of acquis.'tion proceedings,
F the starting point would be from the date of knowledge of such proceedings
or accrual of rights, whichever is later.

The appellants' property was taken over by the respondent for war
purpose~. The appellants gave a notice to quit to the respondent.
Subsequently, the appellants filed a writ petition before the High Court
G for directions that the property be acquired or the possession be banded
back. The respondent agreed to acquire the said property.

The respondent invoked the urgency clause under Section 17 of the
Land Acquisition Act, 1894 and an award was passed. In that award a 1i;i.._
certain amount was fixed as compensation. The appellants applied that
II 956
M.R. DALAL v. U.0.1. 957
the amount of compensation be paid to them. A
Subsequently, the respondent filed an application before the Special
Land Acquisition Officer (SLAO) seeking permission to withdraw from
the acquisition proceedings and to set aside the award. The permission
was not granted. Thereafter, the respondent filed an application before
the SLAO for apportionment of its share under Section 30 of the Act. This B
application was rejected as the respondent made no such claim in the land
acquisition proceedings. But the High Court allowed the writ petition filed
by the respondent and directed the SLAO to make a reference under
Section 30 of the Act. Hence the appeal.
c
Allowing the appeal, the Court

HELD: 1. The High Court has erred in setting as side the order of
the Special Land Acquisition Officer declining a reference. It is settled law
that in land acquisition proceedings the Government cannot and does not
acquir~ its own interest. The interest, which is acquired in land acquisition D
proceedings, is interest of third parties. (964-A-B)

Collector ofBombay v. Nusserwanji Rattanji Mistri, [19S5) l SCR 1311,
relied on.

Inder Parshadv. Union ofIndia, (1994) 5 SCC 239 and Rattan Kumar E
Tandon v. State of U.P., (1997) 2 SCC 161, held inapplicable.

Government of Bombay v. Esupali Salebhai, (1909) ILR 34 Dom. 618
and Deputy Collector v. Aiyayu Pi/lay, (1911) 9 IC 341, cited.
F
2. If the respondent had a right as a tenant, it would be entitled to a
share in the compensation. However such a claim, if any, was in respect
of a pre-existing right and should have been made before the SLAO. in
the land acquisition proceedings. From the award it is clear that the
respondent was represented before the SLAO. It had been given notice.
No claim of tenancy had been made before the SLAO. (966-C-D) G

3. It was the duty of the SLAO to enquire into and ascertain the
respondent's interest in the land whether or not it was present. The SLAO
may have been aware that the respondent was in possession. But merely
because a party is in possession, does not lead to an inference that the party H
r

958 SUPREME COURT REPORTS [2004] SUPP. l S.C.R.

A is in possession under a right. The possession had been taken during the
war for defence purposes and that the notice to quit had been given.
Therefore, if any claim to tenancy was to be made, it had to be specifically
-
raised and then only it could have been dete.rmined. If a party is present
and makes no claim, the SLAO is under no duty to make an enquiry. Once
B a party is represented and makes no claim, it would be a reasonable
inference that it is claiming no rights. (966-H; 967-A)

4. Section 18 of the Land Acquisition Act, 1894, is to be invoked when
a person claiming a pre-existing right has notice of the acquisition
proceedings, whereas Section 30 comes intp play only if a person had no
C notice of the acquisition proceedings or the rights came into existence after
the acquisition proceedings. A person who had notice of the acquisition
proceedings and who, by virtue of Sectio~ 50, is debarred from filing a
reference under Section 18, cannot be allowed to apply for a reference
un"er Section 30. In the present case, this· Court has already held that
the respondent is not entitled to apply for a reference under Section 18.
D This meant that it was not entitled to seek a reference not just in respect
of the compensation but also for apportionment of the compensation. Once
it has been held that the respondent had no right to move under Section
18 there was no question of i~ being permitted to move under Section 30.
To permit a party, who cannot apply under Section 18, to apply under
E Section 30 would be to render Section SO nugatory. [970-F-H; 971,.A)

C.H. Grant v. State, (1965) 3 SCR 756 and Sharda Devi v. State of
Bihar, (2003) 3 SCC 128, relied on.

5.1. Under Section 18 if a party wants to claim a reference, it is to } .,
F be done within a particular period. U,ndoubtedly, under Section 30 no such ~-I

time limit has J>een prescribed. However, it is clear that any such t
application must be made within a reasonable time. What is the reasonable
time, will depend upon the facts and circumstance~ of each case. In a case
like the present, the reasonable time would be the time allowed under
G Section 18. (967-D-H; 968-G-H)

Gujarat v. Raghav, (1970) 1 SCR 335, relied on.

5.2. Even though no limitation is provided for making a reference
under Section 30, the power had to be exercised within a reasonable period.
H In cases where the parties have notice of the acquisition proceedings, even
I
(.
M.R. DALAL v. U.O.I. [VARIAVA, J.] 959
presuming, they can apply for a reference under Section 30, the reasonable A
time would be the. period prescribed under Section 18. However, where
the parties do not have notice of the acquisition proceedings and/or their
rights come into existence subsequent to the acquisition proceedings the
starting point of limitation may be postponed but the reasonable time
would be the time set out in Section 18 from the date of the knowledge or
from the date they acquire rights, whichever is later. (972-G-H; 973-AJ B
Sharda Devi v. State of Bihar, (2003) 3 SCC 128, relied on.

CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 5422-5423
of 1998.
c
From the Judgment and Order dated 6.7.98 of the Bombay High Court
in W.P. No. 1929/97 and Notice of Motion No. 300/97 in W.P. No. 1733 of
1994.

P.P. Rao, B.S. Bhesania, Sanjay R. Hegde, Hemant Shah, U.J. Makhija, D
Anil K. Misra, Ms. Mahalaxmi Pavani and Mallikarjuna Reddy for the
Appellant.

N.N. Goswami, Ms. Rekha Pandey, Ms. Sushma Suri, Ms. Anil Katiyar,
Pallav Shishodia, D.N. Mishra and Hemant Sharma for the Respondents.
E
The Judgment of the Court was delivered by

S.N. VARIA VA, J. These Appeals are against a Judgment of the
Bombay High Court dated 6th July, 1998.

Briefly stated the facts are as follows:
F
One Jerbano Cursetji and Dr. K. J. Cursetji were granted a lease in
perpetuity by the Municipal Authority of Bombay in the year 1932. On l lth
January, 1938, the property was taken over by the Defence Department for
war purposes. The Defence Department paid as.um of Rs. 1,903 per annum
and such payments had been made till 1994. In 1980 a notice to quit out was G
given to the Defence Department. Thereafter in 1982 a Writ Petition No. 919/
1982 was filed for directions that the property be acquired or the possession
be handed back. In that Writ Petition a statement was made, on the basis of
the written instructions received from the Union of India, that the land would
be acquired. On this statement the Writ Petition was withdrawn.
H
960 SUPREME COURT REPORTS [2004] SUPP. I S.C.R.

A The land was still not acquired. Therefore on 8th June, 1994, Jerbano
Cursetji filed Writ Petition No. 1733/1994 for directions that in compliance
with the statement made earlier the land be acquired or the possession be
handed back. After this Writ Petition was filed, on 3rd November, 1994,
Jerbano Cursetji died. It must be mentioned that her husband Dr. K. J. Cursetji
B had died earlier to the filing of the Writ Petition.

The Government now invoked urgency clause under Section 17 of the
Land Acquisition Act and a Notification under Section 4 was published on
31st December, 1994. Section 6 Notification was published on 23rd February,
1995 and an Award came to be passed on 30th May, 1995. In that Award the
C compensation was fixed at Rs. 9,20,51,175. The Appellants, who were the
Legal Representatives of Mrs. Jerbano Cursetji and Dr. K. J. Cursetji, applied
that the amount of compensation be paid to them. Since there was no response
they filed Notice of Motion bearing No. 156/1996 in pending Writ Petition
No. 1733/94 that the amount be paid to them. On 24th June, 1996 the High
Court directed the Special Land Acquisition Officer to deposit the amount in
D Court.

On 24th July, 1996 the Union of India filed Writ Petition No. 1603/
1996 challenging the Award.as excessive. Union oflndia took out the Notice
of Motion No. 279/96 for extension of time to deposit the amount. On 30th
August, 1996 the Writ Petition taken out by the Union of India was rejected.
E However Union of India was granted time till l st October, 1996 to deposit
the amount.

The Union of India now filed a S.L.P., in this Court, against the Order
dated 24th June 1996. On 2nd September, 1996 the S.L.P. was dismissed
.F with the following observation:

" ........... The Award of the Collector is an offer made on behalf of the
State and, therefore, under law, the State cannot question the
correctness of the award determined by the Land Acquisition Officer.
The State is bound by the same. Under these circumstances, they
cannot impeach the award of the Collector as being excessive of the
G ''
prevailing market value as on the date of the notification. There is no
law applicable to the Petitioners that they are entitled to seek any
\~
reference under Section 18 as regards the rate of compensation J
·determined under Section 23(1) of the Act. Only in the State of U.P.
by a local amendment, such a right to the State to seek reference
H under Section 18(3) was conferred upon the Commissioner. No such
M.R. DALAL v. U.0.1. [VARIAVA, J.] 961

similar law is existing under Act I of 1874." A
" ...... ,, it would be open to them to agitate the remedy in that behalf
in an appeal filed against that order in the Writ Petition or in any
appropriate proceedings arising thereunder, we _do not find any
illegality in the impugned order.
B
The special leave petition is accordingly dismissed."

The Union of India again applied to the High Court for extension of
time. The High Court by its Order dated 1st October, 1996 refused to extend
the time.

Union of India now filed an S.L.P. against Order dated 30th August,
c
1996. This S.L.P. also came to be rejected by this Court, but time to make
deposit was extended till 25th October, 1996. On 25th October, 1996, Union
of India orally applied to this Court for permission to withdraw from the
acquisition proceedings. This was not granted by this Court.
D
The Union. of India then filed an application before the Special Land
Acquisition Officer seeking permission to withdraw from acquisition and to
set aside the award. This was not granted. On 4th April, 1997, the Union of
India took out Notice of Motion No. IO 1/97 in Writ Petition 1733/94 seeking
permission of the High Court to withdraw from acquisition. The High Court
by its Order dated 25th July, 1997 held as follows: E
" ........ .In our judgment, Respondents No. l and 2 cannot be
permitted to resile from their statements earlier made that the property
in question will be acquired. As far as withdrawal from acquisition is
concerned, the Award in question has already been passed and
possession is already with Respondents No. I and 2. After passing of F
the award, nothing further was required to be done in order to obtain
possession. Land has thus vested in the government. Respondents
No. l and 2, in the circumstances, are not entitled to withdraw from
acquisition in terms of Section 48(1) of the Act."

"Hence, Respondents Nos. 1 and 2 are not, at this belated stage, G
entitled to withdraw from acquisition. In the circumstances we find
that present notice of motion is devoid of merits and the same is
dismissed with costs."

The Union of India again filed a S.L.P. before this Court against the H
962 SUPREME COURT REPORTS [2004) SUPi'. l S.C.R.

A rejection of the Notice of Motion. This Court inquired whether Union of
India is willing to hand back possession. This Court was informed that Union
of India was not willing to hand back possession. This Court therefore declined
to interfere and directed the Union of India to file an undertaking affirming
that the payment would be made. On lst September, 1997 the Joint Secretary
B in the Ministry of Defence, New Delhi filed an affidavit of undertaking in the
following terms:

" ....... .1, on behalf of the Government of India undertake to deposit
with the Special Land Acquisition Officer, Maharashtra Housing &
Area Development Authority, Bombay a sum of Rs. 9,20,51,175
c (Rupees nine crore, twenty lacs, fifty one thousand one hundred and
seventy five only) as awarded· by the said Land Acquisition Officer
on 30.5.1995 in respect of acquisition of plot No. 53-A, Worli, Bombay .
in proceedings No. LAQ/SR-I/94 on or before 21-9-97. The said
. amount will be paid over to the Claimants after steps are taken by the
SLAO for vesting the property absolutely in Government of India.
D
I respectfully submit that' the above said deposit will be without
prejudice to the rights of either party to initiate/take any proceedings
arising out of in r~spect of or relating to the said land or acquisition
\.
thereof in accordance with' iaw. It is, however," submitted that in view
of the above ~ndertakirtg contempt of court proceedings No. 5/97 in
E Bombay High Court on account of failure to deposit the above said
amount is liable to be dropped.

I say that the statements made above are true to my knowledge."

This Court kept this undertaking on file and disposed of the S.L.P. in
F the following term:

"We are not inclined to interfere with the impugned order. The
undertaking filed on behalf of the P_etitioners is kept on record. On
the prayer of learned ASG appearing for the Union of India, time to
deposit money in High Court is extended by 21st September, 1997.
G It is submitted by Mr. Nariman, Learned senior counsel appearing for
the Respondents that in view of the assurance given that the money
wili be deposited by 21st September, 1997 the respondents will not
press the Contempt Petition. The S.L.P. stands disposed of."

The Contempt Petition mentioned in this Order is a contempt petition
H
M.R. DALAL v. U.0.1. [VARIAVA, J.] 963
which had been filed by the Appellants before the High Court on 12th A
December, 1996.

Now the Union of India filed an application before the Land Acquisition
Officer for apportionment of their share under Section 30 of the Land
Acquisition Act. The Land Acquisition Officer rejected this application by
his Order dated 26th September, 1997, wherein it was mentioned that no B
claim had been made by the Defence Department or the Union of India in the
land acquisition proceedings, even though their representatives were present
at the time of hearing. It was also held that they had given an undertaking
to this Court that they would make the payment and in that undertaking there
was no mention of claim for apportionment. c
The Union of India then filed Writ Petition No. 1929/97 challenging
the aforesaid order of the Special Land Acquisition Officer. The Petitioner
filed Contempt Petition in this Court on 21st January, 1998 as the Union of
India had not permitted payment to be made to the Petitioner. A notice was
issued by this Court in the Contempt Petition on 20th February, 1998. D
On 6th July, 1998 the Bombay High Court allowed the Writ Petition
filed by the Respondents and directed the Special Land Acquisition Officer
to make a reference under Section 30 of the Land Acquisition Act. The High
Court had held (a) that it was not disputed that the Respondents were tenants
paying yearly rent, (b) that under Section 11 of the Land Acquisition Act a E
duty is cast upon the Special Land Acquisition Officer to inquire and consider
the interest of the Respondents and to apportion the compensation irrespective
of whether they had appeared or not. It was held that as the Land Acquisition'
Officer had not enquired into and considered apportionment of compen~ation
amongst all persons interested in the land, in spite of the fact, that he had F
information that the Respondents were tenants they were entitled to claim
reference, (c) that the Respondents are not entitled to claim a reference under
Section 18 of the Land Acquisition Act and thus the only remedy was to
claim a reference under Section 30 or file a Civil Suit; and (d) that the
application for apportionment was not barred by res-judicata or on principles
analogous to res-judicata. It is this Judgment which has been impugned in G
these Appeals.

In these Appeals, by an interim order dated 30th October, 1998 the
.., Appellants had been permitted to withdraw 50% of the amount deposited
subject to the outcome of the Appeal. The Contempt Petition taken out by the
Petitioners was also directed to be heard along with these Appeals. Hence the H
964 SUPREME COURT REPORTS [2004] SUPP. I S.C.R.

A Contempt Petition is also on board today.
In our view, the High Court has clearly erred in setting aside the order
of the Special Land Acquisition Officer declining a reference. It is settled law
that in land acquisition proceedings the Government cannot and does not t.
acquire its own interest. The interest which is acquired in land acquisition
B proc.eedings are interest of 3rd parties. This Court has as far back as in 1955,
in the case of The Collector of Bombay v. Nusserwanji Rattanji Mistri and
Ors., reported in [1955] 1 SCR 1311, negatived a contention that when land
is acquired valuation is made of all interest thereon including the interest of
the Government. This Court held as follows:
c "We are unable to accept his contention. When the Government
acquires lands under the provisions of the Land Acquisition Act, it
must be for a public purpose, and with a view to put them to that
purpose, the Government acquires the sum total of all private interests
subsisting in them. If the Government has itself an interest in the
D land, it has only to acquire the other interests outstanding therein, so
that it might be in a position to pass it on absolutely for public user.
In the Matter of the Land Acquisition Act: The Government ofBombay
v. Esupali Salebhai, (1909) I.L.R. 34 Born. 618, 636 Batchelor, J.
observed:

E "In other words Government, as it seems to me, are not debarred
from acquiring and paying for the only outstanding interests merely
because the Act, which primarily contemplates all interests as held
outside Government, directs that the entire compensation based upon
the market value of the whole land, must be distributed among the
claimants".
F
there, the Government claimed ownership of the land on which there
stood buildings belonging to the claimants, and it was held that the
Government was bound. to acquire and pay only for the superstructure,
as it was already the owner of the site. Similarly in Deputy Collector,
Calicut Division v. Aiyavu Pi/lay, (1911) 9 l.C. 341, Wallis, J. (as he
G then was) observed :

"It is, in my opinion, clear that the Act does not contemplate or
provide for the acquisition of any interest which already belongs to
Government in land which is being acquired under the Act, but only
for the acquisition of such. interests in the land as do not already
H
M.R. DALAL v. U.0.1. [VARIAVA, J.] 965
belong to the Government". A
With these observations, we are in entire agreement. When
Government possesses an interest in land which is the subject of
.I. acquisition under the Act, that interest is itself outside such acquisition,
because there can be no question of Government acquiring what is its
own. An investigation into the nature and value of that interest will B
no doubt be necessary for determining the compensation payable for
the interest outstanding in the claimants, but that would not make it
the subject of acquisition. The language of section VIII of Act No. VI
of 1857 also supports this construction. Under that section, the lands
vest in the Government "free from all other estates, rights, titles and
interests", which must clearly mean other than those possessed by the
c
Government. It is on this understanding of the section that the award,
Exhibit P, is framed. The scheme of it is that the interests of the
occupants are ascertained and valued, and the Government is directed
to pay the compensation fixed for them. There is no valuation of the
right of the Government to levy assessment on the lands, and there D
is no award of compensation therefor.

Faced with this situation Mr. Goswami relied upon the Judgment of this
Court in the case of Jnder Parshad v. Union of India, reported in [1994] 5
SCC 239. In this case the Government had given a lease of the land. That
land was then acquired. This Court recognized the principle that the E
Government is not enjoined to acquire its own interest in the land. This Court
held that however where the Collector determined the compensation without
taking into consideration that the private party is only entitled to leasehold
interest, then the compensation would have to be apportioned between the
Government and the private party. There can be no dispute with this
F
preposition. In the present case it is to be seen that the land belonged to the
Municipality of Bombay. In the Award the Collector has apportioned the
compensation between the Municipality and the Appellants herein. Therefore,
this authority can be of no assistance to the Respondents who are not claiming
the land as owners. They are now claiming on the basis that they are protected
tenants under the Bombay Rent Act and that as such tenants they are entitled G
to share in the compensation. As is being pointed out later no such claim was
made before the Collector and it cannot be made at this stage.

i
... i Mr. Goswami also relied upon the case of Ratan Kumar Tandon v.
State of U.P., reported in [1997] 2 SCC 161. In this case, by virtue of the
H
966 SUPREME COURT REPORTS [2004) SUPP. 1 S.C.R.

A Urban Land (Ceiling and Regulation) Act excess land stood vested in the
State. In the Reference under Section 18 the State pointed out that no
compensation could be paid in respect of the excess land as it already stood
vested in the State. This Court held that the claimants would only be entitled
to compensation for the land which remained with them after the application
of the Urban Land (Ceiling and Regulation) Act. This authority is of no
B assistance to the Respondents. If anything this authority is against the
Respondents inasmuch as it also recognizes that the Government does not
acquire its own land and that when compensation is being fixed it is only in
respect of the interest of the third party claimants.

C Of course if the Respondents had a right as tenants, they would be
entitled to share in the compensation. However such a claim, if any, was in
respect of a pre-existing right and should have been made before the Land
Acquisition Officer in the land acquisition proceedings. From the ~ward it
is clear that the Respondents were represented before the Land· Acquisition
Officer. They had been given notice. No claim of tenancy had been made
D before the Land Acquisition Officer.

. The High Court in its earlier Judgment dated 30th August 1996 has
itself observed as follows: .

" .... admittedly by the petitioners have not contended before the land
E acquisition officer that they were yearly tenants protected under the
Bombay Rent·Act."

The Special Land Acquisition Officer has also in his decision dated ·26th
September 1997 pointed ·out that Respondents were represented in the
acquisition proceedings but had made no such claim. The High Court has
F also failed to notice that even the Respondents do not assert that they had
made any such claim in the acquisition proceedings. The High Court is thus
in error in observing that the Land Acquisition _Officer was aware of such a
claim. We are unable to subscribe to the view of the High Court that it was
the duty of the Land Acquisition Officer to enquire into and ascertain their
G interest in the land whether or not they were present. The Special Land
acquisition. Officer may have been aware that they were in possession. But
merely because a party is in possession does not lead to an inference that the
party is in possession under a right. It must be remembered that the possession
had been taken during th.e war for defence purposes and that the notice to
quit had been given in 1980. Therefore, if any claim,' to ·tenancy was to be
H made, it had to be specifically raised and then only it could have b~en
M.R. DALAL v. U.0.1. [VARIAVA, J.] 967
detennined. If a party is present and makes no claim the Special Land A
Acquisition Officer is under no duty to make an enquiry. Once a party is
represented and makes no claim, it would be a reasonable inference that it is
claiming no rights. It is clear that the claim of tenancy, now put forth, is an
afterthought. Having failed in all their efforts to frustrate payment, through
the gamut of litigations set out hereinabove, now this attempt.
B
Even otherwise, we find that the High Court has clearly erred in not
noticing that it has already been held by this Court that the Respondents are
not entitled to a reference under Section 18 of the Land Acquisition Act.
What is the scope of Sections 18 and 30, has been set out by this Court in
the case of G. H Grant v. State, reported in [1965] 3 SCR 756. It has been C
held as follows:

"There are two provisions ss. 18(1) and 30 which invest the
Collector with power to refer to the Court a dispute as to apportionment
of compensation or as to the persons to whom it is payable. By sub-
s. (I) of s. 18 the Collector is enjoined to refer a dispute as to D
apportionment, or as to title to receive compensation, on the application
within the time prescribed by sub-s. (2) of that section of a person
interested who has not accepted the award. Section 30 authorises the
Collector to refer to the Court after compensation is settled under s.
11, any dispute arising as to apportionment of the same or any part
thereof or as to the persons to whom the same or any part thereof is E
payable. A person shown in that part of the award which relates to
apportionment of compensation, who is present either personally or
through a representative, or on whom a notice is served under sub-
s. (2) of s. 12, must, if he does not accept the award, apply to the
Collector within the tinie prescribed under s. 18(2) to refer the matter F
to the Court. But a person who has not appeared in the acquisition
proceeding before the Collector may, if he is not served with notice
of the filing, raise a dispute as to apportionment or as to the persons
to whom it is payable, and apply to the Court for a reference under
s. 30, for detennination of his right t-0 compensation which may have
existed before the award, or which may have developed upon him G
since the award. Whereas under s. 18 an application made to the
Collector must be made within the period prescribed by sub-s. (2) cl.
(b), there is no ~cllperiod prescribed under s. 30. Again under s. 18,
is
the collector bound to make a reference on a petition filed by a
person interested. The Collector is under s. 30 not enjoined to make H
968 SUPREME COURT REPORTS [2004] SUPP. 1 S.C.R.

A a reference : he may relegate the person raising a dispute as to
apportionment, or as to the person to whom compensation is payable,
to agitate the dispute in a suit and pay the compensation in the manner
declared by his award."

xxx xxx xxx
B
" ...... The Collector is not authorised to decide finally the conflicting
rights of the persons interested in the amount of compensation : he
is primarily concerned with the acquisition of the land. In determining
the amount of compensation which may be offered, he has, it is true,
to apportion the'amount of compensation between the persons known
c or believed to be interested in the land, of whom, or of whose claims,
he has information, whether or not they have appeared before him.
But the scheme of apportionment by the Collector does not finally
determine the rights of the persons interested in the amount of
compensation : the award is only conclusive between the Collector
D and the persons interested and not among the persons interested. The
Collector has no power to finally adjudicate upon the title to
compensation, that dispute has. to be decided either in a reference
under s. 18 or under s. 30 or in a separate suit. Payment of
compensation therefore under s. 31 to the person declared by the
award to be entitled thereto discharges the State of its liability to pay
E compensation (subject to any modification by the Court), leaving it
open to the claimant to compensation to agitate his right in a reference
under s. 30 or by a separate suit."

This Court has again in the case of Sharda Devi v. State of'Blhar,
reported in (2003] 3 SCC 128 very succinctly dealt with the provisions of
F Sections 18 and 30 and on an analysis of the provisions and the various
authorities held as follows:

"26. The scheme of the Act reveals that the remedy of ref~rence
under Section 18 is intended to be available only to a 'person
interested'. A person present either personally or through representative
G or on whom a notice is served under Section 12(2) is obliged, subject
to his specifying the test as to locus, to apply to the Collector within
the time prescribed under Section 18(2) to make a reference to the
Court. The basis of title. on which the reference would be sought for
under Section 18, would obviously be a pre-existing title by reference
H to .the date of the award. So is Section 29, which speaks of·'persohs
I •
M.R. DALAL v. U.0.1. [VARIAVA, J.] 969
interested'. Finality to the award spoken of by Section 12(1) of the A
Act is between the Collector on one hand and the 'persons interested'
on the other hand and attaches to the issues relating to (i) the true
area, i.e., measurement of the land, (ii) the value of the land, i.e., the
quantum of compensation, and (iii) apportionment of the compensation
among the 'persons interested'. The 'persons interested' would be B
bound by the award without regard to the fact whether they have
respectively appeared before the Collector or not. The finality to the
award spoken of by Section 29 is as between the 'persons interested'
inter se and is confined to the issue ·as to the correctness of the
.. apportionment. Section 30 is not confined in its operation only to
'persons interested'. It would, therefore, be available for being invoked C
by the 'persons interested' if they were neither present nor represented
in proceedings before the Collector, nor were served with notice under
Section 12(2) of the Act or when they claim on the basis of a title
coming into existence post award. The definition of 'person interested'
speaks of 'an interest in compensation to be made'. An interest coming
into existence post award gives rise to a claim in compensation which D
has already been determined. Such a person can also have recourse
to Section 30. In any case, the dispute for which Section 30 can be
invoked, shall remain confined only (i) as to the apportionment of the
amount of compensation or any part thereof, or (ii) as to the persons
to whom the amount of compensation (already determined) or any E
part thereof is payable. The State claiming on the basis of a pre-
existing right would not be a 'person interested', as already pointed
out hereinabove and on account of its right being pre-existing, the
State, in such a case, would not be entitled to invoke either Section
18 or Section 30 seeking determination of its alleged pre-existing
right. A right accrued or devolved post award may be determined in F
a reference under Section 30 depending on Collector's discretion to
show indulgence, without any bar as to limitation. Alternatively, such
a right may be left open by the Collector to be adjudicated upon in
any independent legal proceedings. This view is just, sound and logical
as a title post award could not have been canvassed upto the date of G
the award and should also not be left without remedy by denying
access to Section 30. Viewed from this angle, Sections 18 and 30
would not overlap and would have fields to operate independent of
each other." ·

xxx xxx xxx H
970 SUPREME COURT REPORTS (2004] SUPP. 1 S.C.R.

A "36. To sum up the State is not a 'person interested' as.defined
in Section 3(2) of the Act. It is not a party to the proceedings before
the Collector in the sense, which the expression 'parties to the
litigation' carries. The Collector holds the proceedings and makes an
award as a representative of the State Government. Land or an interest
in land pre-owned by State cannot be subject-matter of acquisition by
B State the question of deciding the ownership of State or holding of
any interest by the State Government in proceedings before the
Collector cannot arise in proceedings before the Collector (as defined
in Section 3(c) of the Act). Ifit was a government land, there was no
question of initiating the proceedings for acquisition at all. The
c Government would not acquire the land, which already vests in it. A
dispute as to pre-existing right or interest of the State Govemment in
the property· sought to be acquired, is not a dispute capable of being
adjudicated upon or referred to the Civil Court for determination
either under Section 18 or Section 30 of the Act. The reference made
by the Collector to the Court was wholly without jurisdiction and the
D Civil Court ought to have refused to entertain the reference and ought
to have rejected the same. All the proceedings under Section 30 of ·
the Act beginning from the reference and adjudication thereon by the
\.
Civil Court suffer from lack of inherent jurisdiction and are, therefore,
a nullity liable to be declared so."
E It is thus clear that persons who have notice of acquisition proceedings,
would have to apply for a Reference ~nder Section 18. To be noted that
under· Section 18 Reference could be in respect of the measurement of the
land and/or the amount of compensation and/or in respect of persons to
whom it is payable and/or for apportionment of compensation amongst persons 1 •
F interested. Section 30 merely deals with apportionment of compensation when
the amount of compensation has been settled. Thus, as set out in the above
mentioned cases, Section 18 is to be invoked when a person claiming a pre-
existing right has notice of the acquisition proceedings: whereas Section 30
comes into play only if a person had no notice of the acquisition proceedings
G or the rights came into existence after the acquisition proceedings. It is clear
that the person who had notice of the acquisition proceedings and who, by
virtue of Section 50, is debarred from filing a Reference under Section 18,
cannot be allowed to apply· for a Reference under Section 30. In this case,
this Court has already held that the Respon~ents were not entitled to apply
for a Reference under Section 18. This meant that they were not entitled to
H seek a Reference not just in respect of the compensation but also for
M.R. DALAL v. U.O.I. [VARIAVA, J.] 971
apportionment of the compensation. Once it has been held that they had no A
right to move under Section 18, there was no question of their being permitted
to move under Section 30. To permit a party, who cannot apply under Section
18, to apply under Section 30 would be to render Section 50 nugatory.

The High Court has also erred in holding that the claim for apportionment
was not barred by principle of res-judicata or principles analogous thereto. B
As has been set out hereinabove the Respondents had filed Writ Petition No.
1603/96 challenging the Award as excessive. One of the grounds for claiming
the Award as excessive was as follows:

"Petitioners submit that thus while assessing or determining the C
compensation the Special Land Acquisition Officer-Respondent No..
4 ought to have considered the share of the tenants/lessees/document'>
including the Ministry of Defence on the basis of hiring and as to that
extent the compensation ought to have been reduced."

Thus, in that Writ Petition they had already claimed that their share as tenants/
lessees should have been taken into consideration. That Writ Petition came D
to be dismissed. The S.L.P. filed against that Writ Petition was withdrawn by
them. To claim apportionment on the ground that.they had share as tenant or
lessee is in fact nothing else but an attempt to reduce the compensation. The
prayer asked for now is identical to the prayer made earlier.
E
Even otherwise, it is settled law that in every proceeding the whole of
the claim which a party, is entitled to make, should be made and where a
party omits to sue in respect of any portion of the claim, he cannot afterwards
sue for the portion so omitted. Explanation 4 to Section 11 C. P. C. also
provides that any matter which might or ought to have been made a ground
of defence or attack in a former proceeding will be deemed to have been a F
matter directly and subsequently in issue in that proceeding. Therefore, clearly
the claim now made was barred on principle of res-judicata or principles
analogous thereto.

There is one other reason why the High Court should not have allowed
the Writ Petition. Under Section 18 if a party wants to claim a Reference, it G
is to be done within a particular period. The Proviso to Section 18 reads as
follows:

" .... Provided that every such application shall be made -

(a) if the person making it was present or represented before the H

I
972 SUPREME COURT REPORTS [2004) SUPP. 1 S.C.R.

A Collector at the time when he made his award, within six weeks
from the date of the Collector's award;
(b) in other cases, within six weeks of the receipt of the notice from
the Collector under section 12, sub-section (2); or within six \
months from the date of the Collector's.
B Undoubtedly under Section 30 no such time limit has been prescribed.
However~ it is clear that any such application must be made within a reasonable
time. What is the reasonable time, will depend upon the facts and circumstances
of each case. In a case like present, the reasonable time would be the time
as allowed under Section 18. This Court has in the case of Gujarat v. Raghav, <
C reported in (1970] 1 SCR 335 considered the provisions of Sections 65 and
211 of the Bombay Land Revenue Code, 1879. It was noticed that Section :-
211 did not prescribe a time limit within which the Commissioner could
revise an order under Section 65. It was however held as follows:

" ...... .It is true that there is no period of limitation prescribed under
D s. 211, but it seems to us plain that this power must be exercised in
reasonable time and the length of the reasonable time must be
determined by the facts of the case and the nature of the order which
is being revised.

It seems to us that S. 65 itself indicates the length of the reasonable
E time within which the Commissioner must act under s. 211. Under s.
65 of the Code if the Collector does not inform the applicant of his
decision on the application within a period of three months, the
permission applied for shall be deemed to have been granted. This
section shows that a period of three months is considered ample for
the Collector to make up his mind and beyond that the legislature
' .
F
thinks that the matter is so urgent that permission shall be deemed to
have been granted. Reading ss. 211 and 65 together it seems to us
that the Commissi<?ner must exercise his revisional powers within a
few months of the order of the Collector..... "

G Even in Sharda Devi's case (supra) this Court has held that even though no
limitation is provided for making a reference under Section 30, the power
had to be exercised within a reasonable period. This Court has held that what
is the reasonable period, would depend upon the facts of each given case. It
appears to us that in cases where the parties have notice of the acquisition "
proceedings, even presuming, they can apply for a reference under Section
H 30, the reasonable time would be the period prescribed under Section 18. We
M.R. DALAL v. U.O.I. [VARIAVA, J.] 973
immediately clarify that where parties do not have notice of the acquisition A
proceedings and/or their rights come into existence subsequent to the
acquisition proceedings, the starting point of limitation may be postponed but
the reasonable time would be the time set out in Section 18 from the date of
the knowledge or from the date they acquire rights, whichever is later.

For all the above reasons, it will have to be held that the impugned B
Judgment cannot be sustained and is hereby set aside. The Writ Petition filed
by the Respondents stands dismissed. We affirm the order of the Land
Acquisition Officer dated 26th September, 1997 and hold that the Respondents
cannot claim a Reference under Section 30 nor claim apportionment.
)
In our view, the Respondents have by adopting multifarious proceedings C
delayed the payment of amount for a number of years. We, therefore direct
that the Appellants shall be entitled to withdraw the balance amount deposited
in the Court without any further delay.

The Appeals stand disposed of. There will be no order as to costs. D
v.s.s. Appeals disposed of.