Holding

An agreement of sale executed after a Section 4(1) acquisition notification does not confer title, and the government is not bound by such an agreement; compensation is payable to the owner as determined on the date of notification, though the claimant may pursue a claim under Section 30.

Summary

The Collector acquired certain lands under a notification issued on 17 November 1980 pursuant to Section 4(1) of the Land Acquisition Act, 1894 and awarded compensation of Rs 38,500. The petitioner claimed a higher amount and a reference under Section 18 of the Act was filed; he relied on a sale agreement dated 5 December 1981, executed after the acquisition notification. The civil court rejected the agreement and ordered the reference in favour of the respondents, a decision affirmed by the Delhi High Court on the ground that the agreement violated Section 4 of the Delhi Land (Restriction & Transfer) Act, 1972. The Supreme Court held that a post‑notification agreement of sale does not confer title for the purpose of compensation and the government is not bound by it; the title as of the notification date remains with the respondent. Consequently, compensation was payable to the respondent, although the petitioner may pursue any right he has under Section 30 of the Land Acquisition Act. The Special Leave Petition was dismissed.

Issues considered

The effect of a sale agreement executed after a Section 4(1) acquisition notification on the title to receive compensation
Whether the government is bound by a post‑notification agreement of sale
Whether the petitioner can claim compensation under Section 30 of the Land Acquisition Act

Legislation cited

Land Acquisition Act, 1894s. 18, s. 30, s. 4
Transfer of Property Act, 1882s. 53-A

Subjects

land acquisitioncompensationagreement of saletitleSection 4 notificationSection 18 referenceSection 30 claimDelhi Land (Restriction & Transfer) Act

Judgment

..... '
SUNIL KUMAR JAIN
v.
KISHAN AND ORS.
A

APRIL 27, 1995

[K. RAMASWAMY AND B.L. HANSARIA, JJ.] B

Land Acquisition Act, 1894 :

Ss. 4, 18, 30-Agreement of sale subsequent to the notification
u/s.4(1T-Wl!ether Government bound by such agreement :
c
Certain lands were acquired and the Collector made an award for a
sum of Rs 38,500. Petitioner claimed higher amount and a reference under
s.18 of the Land Acquisition Act was made. Tue Civil Court disbelieved the
agreement of sale put forth by the petitioner and ordered the reference in
favour of respondents. In appeal, the High Court held that the said D
-j agreement was in violation of s.4 of the Delhi Land (Restriction & Trans·
fer) Act, 1972 and confirmed the findings of the Reference Court. Hence
this Special Leave Petition.

Dismissing the petition, this Court
E
HELD : 1. In a reference, the dispute is to the title to receive the
compensation. It is settled law that the agreement of sale does not confer
title and, therefore, the agreement holder, even assuming that the agree·
ment is valid, does not acquire any tittle to the property. It is seen that the
agreement is subsequent to the notification under s.4(1). The Government
F
is not bound by such an agreement. Tue inter-se. dispute is only with respect
to the title as on the date of notification under s.4(1). Tue respondent is
the undoubted owner of the property as per s.4 notification and that,
therefore, the compensation was directed to be paid to the respondent.
[856-E, F]
2. However, if the petitioner has got any claim under s.30 of the Land
G
•f
Acquisition Act, it is open to him to take such action as open to him under
law. [856-G]

CIVIL APPELLATE JURISDICTION : Special Leave Petition (C)
No. 9886 of 1987. H
855
'
856 SUPREME COURT REPORTS (1995] 3 S.C.R.

A From the Judgment and Order dated 7.5.87 of the Delhi High Court
in R.F.A. No. 292 of 1987.

V.J. Francis for the Petitioner.

The following Order of the Court was delivered :
B
Notification under s.4(1) of the Land Acquisition Act was published
on November 17, 1980 acquiring the lands in question. The Collector made
an award for a sum of Rs. 38,500. Since the petitioner laid claim for a
higher amount, a reference under s.18 was made. The civil court dis-
C believed the. agreement of sale put forth by the petitioner; therefore,
reference was ordered in favour of the respondents. In appeal , the High
Court said that the said agreement was in violation of s.4 of the Delhi Land
(Restriction & Transfer) Act, 1972 and that, therefore, the agreement is
void. Accordingly, the findings of the Reference Court was accepted. Thus,
this appeal by Special Leave.
D
Learned counsel appearing for the petitioner contended that the
under the agreement of sale dated 5th December, 1981 the respondents
had received consideration and kept the petitioner in possession of the land
and that, therefore, by operation of s.53-A of the Transfer the Property
E Act, the petitioner is entitled to the compensation. We are unable to agree
with the learned counsel. In a reference, the dispute is to the title to receive
the compensation. It is settled law that the agreement of sale does not
confer title and, therefore, the agreement holder, even assuming that the
agreement is valid, does not acquire any title to the property. It is seen that
the agreement is subsequent to the notification under s.4(1). The Govern-
F ment is not bound by such an agreement. The inter-se dispute is only with
respect to the title as on the date of notification under s.4(1). The Respon-
dent is the undoubted owner of the property as per s.4 notification and
that, therefore, the compensation was directed to be paid to the respondent
since he is one of the members. We cannot find any illegality in the order
G passed by the Courts. However, if the petitioner has got any claim under
s.30 of the Land Acquisition Act, it is open to him to take such action as
open to him under law.

The Special Leave Petition is accordingly dismissed.

G.N. Petition dismissed.