Research › Search › Judgment

J&K High Court · body

2019 DIGILAW 21 (JK)

State of J&K v. Gul Mohammad Bhat

2019-01-18

SANJEEV KUMAR

body2019
JUDGMENT : 1. In this writ petition filed by the State, the petitioner challenges the orders dated 27th March, 2010, 21st December, 2013, 2nd January, 2016 and 6th February, 2016, passed by the learned Principal District Judge, Anantnag, hereinafter referred to as the ‘reference court’, in the case titled Gul Mohammad Bhat and others v. Collector Land Acquisition and others. 2. Before adverting to the grounds of challenged, it would be advantageous to refer to the factual matrix leading to the filing of the present petition. 3. Pursuant to the indent placed by Directorate of Fire Services, Srinagar, for acquisition of land for construction of District Fire Complex at Anantnag, the respondent no.12 initiated proceedings for acquisition of land measuring 10 kanals situated at village Sarnal, Anantnag, by issuing a notification under Section 4 of the Land Acquisition Act, hereinafter referred to as the Act. This was followed by a declaration under Sections 6, 7 and 9 of the Act. The respondent no.12 after completion of the proceedings passed the final award to the tune of Rs. 17.25 lakhs i.e., at the rate of Rs. 1.50 lakh per kanal with Jabrana at the rate of 15%. The Director, Fire Services, Srinagar, the indenting department, was directed to remit the award amount within thirty days from the date of issuance of the award. 4. The award by respondent no.12 was passed on 27th January, 1999. The award amount, it is claimed, was deposited by the petitioner department before the respondent no.12 for its disbursement to the lawful owners. The respondent no.12 immediately on receipt of the amount, deposited the same in the Jammu & Kashmir Bank, T. P. Branch, Anantnag, with the request to the Manager of the Branch to transfer the award amount in the individual accounts of the land owners as per their entitlement. 5. The land owners i.e., respondents 1 to 11, however, did not agree to accept the amount awarded and consequently filed an application before the respondent no.12 under Section 18 of the Act, seeking reference to the Principal District Judge, Anantnag. The land owners—respondents 1 to 11 were aggrieved of the rate fixed per kanal by the respondent no.12 for determination of the compensation. It is the case of the petitioner that the indenting department was neither a party in the proceedings before the Collector nor it was arrayed as party respondent in the reference. The land owners—respondents 1 to 11 were aggrieved of the rate fixed per kanal by the respondent no.12 for determination of the compensation. It is the case of the petitioner that the indenting department was neither a party in the proceedings before the Collector nor it was arrayed as party respondent in the reference. It is thus stated that the role of the indenting department was over, the movement the award amount in terms of the award was deposited with the respondent no.12. It further transpires that while the reference proceedings before the reference court were going on, the respondents 1 to 11 filed an application purportedly under Section 35 of the Act, seeking a direction to the petitioner to deposit the amount payable on the award amount by way of statutory interest. The petitioner herein came to be arrayed as party respondent no.12 for the first time in the aforesaid application and on receiving a notice of the application from the reference court, the petitioner took up the matter with respondent no.12 informing him that in terms of his award, the award amount of Rs. 17.25 lakhs had been deposited with him in time for disbursement to the land owners and as per records, pursuant to communication of respondent no.12, issued to the Manager, J&K Bank T.P.Branch, Anantnag, the said amount was also deposited in the individual accounts of the land owners. The petitioner, therefore, denied its liability to pay any interest as there was no delay on his part to make payment to the respondents 1 to 11. 6. The application of the land owners—private respondents made in terms of Section 35 of the Act was objected to by the petitioner by filing detailed objections. The application was considered by the reference court in light of the objections filed by the petitioner and by virtue of orders passed from time to time, the petitioner department was asked to deposit the interest amount on the awarded amount. The coercive measures have also been ordered by the reference court to secure deposit of the amount. The application was considered by the reference court in light of the objections filed by the petitioner and by virtue of orders passed from time to time, the petitioner department was asked to deposit the interest amount on the awarded amount. The coercive measures have also been ordered by the reference court to secure deposit of the amount. Vide order impugned dated 27th March, 2010, the respondent no.12 was directed to deposit the amount with the reference court along with interest at the rate of 6% for the first year from the date of taking over the possession of the land and with further interest at the rate of 10% for the subsequent years. 7. In response to the aforesaid order of the reference court, the J&K Bank, Lalchowk, Anantnag, vide its communication dated 23rd February, 2013, intimated the reference court that the award amount credited in the individual accounts of the land owners has been debited and credited in the CD Account of the reference court. While the coercive measures against respondent no.12 had been directed by the reference court, the respondent no.12, it is stated, shifted the burden on the petitioner by stating that it is for the indenting department to deposit the requisite amount representing the statutory interest. It thus appears that thereafter the proceedings came to be launched against the petitioner and vide order dated 2nd January, 2016 followed by order dated 06.02.2016, the coercive measures have been ordered by the reference court to secure the deposit of the statutory interest. 8. All these impugned orders passed by the reference court have been called in question by the petitioner on various grounds. The private respondents 1 to 11 have filed their reply but the respondent no.12 has chosen not to contest the writ petition. 9. In the reply filed on behalf of respondents 1 to 11, it is stated that immediately after the final award was passed in the matter, the private respondents being not satisfied with the amount awarded moved the respondent no.12 by way of an application under Section 18 of the Act, for making reference to the Reference Court. The private respondents also made a demand for deposit of the award amount in the reference court as the same was not acceptable to them. The private respondents also made a demand for deposit of the award amount in the reference court as the same was not acceptable to them. The Collector, it is pleaded, made a reference to the reference court but did not deposit the award amount along with interest in the reference court. The amount of compensation, it is pleaded, was deposited before the reference court in terms of communication dated 23rd February, 2013 along with interest as had accrued thereon in the bank. It is thus stated that the private respondents who had not accepted the amount of compensation were ultimately paid the same under the orders of the reference court only on 23rd February, 2013, and, therefore, the award amount had attracted statutory interest. It is urged that amount of compensation, if any, deposited by the petitioner or the respondent no.12 before the bank was not a valid deposit in the eyes of law and the amount of compensation, if at all, it can be said to have been validly deposited shall be deemed to have been deposited on 23rd February, 2013. It is thus prayed that statutory interest payable in terms of Section 35 of the Act has to be calculated on the award amount from the date of taking over the possession of the land of the private respondents 1 to 11 till 23rd February, 2013 in terms of Section 35 of the Act. 10. Having heard learned counsel for the parties and perused the record. It would be necessary to first set out the provisions of Section 35 of the Act herein:— “35. Payment of interest.—When the amount of such compensation is not paid or deposited on or before taking possession of the land, the Collector shall pay the amount awarded within interest thereon at the rate of six per centum per annum from the time of so taking possession until it shall have been so paid or deposited. Provided that if such compensation or any part thereof is not paid or deposited within a period of one year from the date on which possession is taken, interest at the rate of ten per centum shall be payable from the date of expiry of the said period of one year on the amount of compensation or part thereof which has not been paid or deposited on the date of such expiry.” 11. From bear reading of Section 35 of the Act, it is clear that the amount of compensation is required to be paid or deposited as the case may be on or before taking over the possession of the land and in case it is not paid it would attract interest at the rate of 6% to be calculated with effect from the date of taking over possession till it has been paid or deposited. It further provides that in case there is a delay in making the payment beyond a period of one year from the date of taking over the possession of the acquired land, the same would become payable at the rate of 10% from the date of expiry of said period of one year till the same is paid or deposited. 12. With a view to properly appreciate the true purport and import of Section 35 of the Act, we may have to look for other provisions of the Act providing for the deposit of the compensation awarded by the Collector. Section 32 of the Act is one such provision contained in the Act. The relevant extract whereof, is reproduced herein:— “32. Payment of compensation or deposit of same in Court.—(1) On making an award under Section 11, the Collector shall tender payment of the compensation awarded by him to the persons interested/ entitled thereto, according to the award, and shall pay it to them unless prevented by some one or more of the contingencies mentioned in the next sub-section. (2) If they shall not consent to receive it, or if there be no person competent to alienate the land, or if there be any dispute as to the title to receive the compensation or as to the apportionment of it, the Collector shall deposit the amount of the compensation in the Court, to which a reference under Section 18 would be submitted. Provided that any person admitted to be interested may receive such payment under protest as to the sufficiency of the amount: Provided also that no person who has received the amount otherwise than under protest shall be entitled to make any application under Section 18: Provided also that nothing herein contained shall affect the liability of any person who may receive the whole or any part of any compensation awarded under this Act to pay the same to the person lawfully entitled thereto.” 13. In terms of Section 32 of the Act, on making of an award under Section 11, it is incumbent upon the Collector to tender payment of the compensation awarded by him to the persons interested /entitled thereto, according to the award, and in case they do not consent to receive it or there be no person competent to alienate the land or there be any dispute with regard to title to receive the compensation or as to the apportionment of it, the Collector is obligated to deposit the amount of compensation in the reference court. The provisions of Section 32 are mandatory in nature. 14. In the light of the two provisions, reproduced hereinabove, and Section 16 of the Act which empowers the Collector to take possession of the acquired land immediately after it makes the award under Section 11 of the Act, the controversy raised in this petition needs to be appreciated. 15. From the rival contentions of the parties, the questions that beg determination in this case can be enumerated in the following manner:— (i) Whether the deposit of the awarded compensation in the bank account maintained by the Collector with direction to deposit the same in the saving accounts of interested persons is a valid deposit and complies with the mandate of Section 32 of the Act? (ii) Whether the petitioner who had deposited the awarded compensation in terms of the award with the Collector within stipulated period can be burdened with liability of paying the statutory compensation in terms of Section 35 of the Act? (iii) Whether the reference court is competent in law to direct the indenting department to deposit the statutory amount of interest on the awarded compensation? 16. The determination of these questions along with the other allied issues would dispose of the controversy raised in these proceedings. In Re: Question No.(i) 17. Admittedly, in the instant case, the award was passed by the Collector on 27th January, 1999. In the absence of any specific evidence with regard to the date of taking over the possession of the land it shall be presumed that possession was taken over by the Collector immediately after making of the award in terms of Section 11 of the Act. This is so provided in Section 16 of the Act. In the absence of any specific evidence with regard to the date of taking over the possession of the land it shall be presumed that possession was taken over by the Collector immediately after making of the award in terms of Section 11 of the Act. This is so provided in Section 16 of the Act. In terms of Section 32, the Collector was under statutory obligation to pay the compensation awarded by him to the persons interested immediately on making of the award and in case of the contentions as provided in sub-section (2) of Section 32, he was supposed to deposit the said amount in the reference court. It is not in dispute that the private respondents did not accept the amount of compensation and sought reference in terms of Section 18 from the Collector. In these circumstances, as is discernable from the pleadings and the available record, the Collector instead of depositing the compensation amount in the reference court, called upon the Manager, J&K Bank, T. P. Branch, Anantnag, vide its communication No.812-14/LA dated 24.11.2000 to transfer the amounts payable to the private respondents 1 to 11 in their individual saving accounts. There is, however, nothing on record to show that aforesaid request of the Collector was complied with by the Manager of the concerned Branch and the amount was credited to the individual accounts of the private respondents 1 to 11. It would, however, appear that pursuant to the orders passed by the reference court, the respondent no.12, vide its communication dated 18.01.2007, requested the Manager, J&K Bank, TP Branch, to release the compensation amount in favour of the land owners. In compliance thereto, the amount of compensation was credited to the individual accounts of the private respondents 1 to 11 on 1st June, 2009. It was only after an order was passed by the reference court on 7th February, 2013, the Jammu & Kashmir Bank, Lalchowk, Anantnag, credited the amounts deposited in the individual saving accounts of the private respondents to the CD account 6005 maintained with the B/4 TP Branch, Anantnag, in the name of the District and Sessions Judge, Anantnag. This was done by debiting the said amounts of the private respondents. Legally speaking it is on 23rd February, 2013, the compensation amount came to be deposited in the court when the same was credited to the account of the reference court. This was done by debiting the said amounts of the private respondents. Legally speaking it is on 23rd February, 2013, the compensation amount came to be deposited in the court when the same was credited to the account of the reference court. In these circumstances, the deposit of amount of compensation to the individual saving accounts of the private respondents on 1st June, 2009, that too apparently without the consent of the private respondents cannot be said to be the valid deposit in the court in terms of Section 32 of the Act. The amount of compensation, therefore, shall be deemed to have been deposited in the court in terms of Section 32 of the Act on 23rd February, 2013. The view taken by me is fortified by the judgment of the Supreme Court rendered in the case of Union of India and Others v. Shivraj and Others, AIR 2014 SC 2242 . Para 19 of the said judgment reads as under:— 19. Now, this is admitted position that award was made on 31.01.2008. Notices were issued to the landowners to receive the compensation and since they did not receive the compensation, the amount (Rs. 27 crores) was deposited in the government treasury. Can it be said that deposit of the amount of compensation in the government treasury is equivalent to the amount of compensation paid to the landowners/persons interested? We do not think so. In a comparatively recent decision, this Court in Ivo Agnelo Santimano Fernandes and Ors. v. State of Goa and Anr. (2011) 11 SCC 506 , relying upon the earlier decision in Prem Nath Kapur v. National Fertilizers Corpn. of India Ltd. (1996) 2 SCC 71 , has held that the deposit of the amount of the compensation in the state’s revenue account is of no avail and the liability of the state to pay interest subsists till the amount has not been deposited in Court. In Re: question No.(ii): 18. Though in terms of Section 32 of the Act, the obligation is cast upon the Collector to tender the payment of compensation to the interested persons according to their entitlement immediately on making of the award under Section 11 of the Act and in case of failure or incapacity of such person(s) to receive compensation, to deposit the same in the reference court. Yet the indenting department on whose instance the land has been acquired cannot be absolved of its responsibility. It is more so when the indenting department and the Collector are the representatives of the State. Having regard to the provisions of Section 32 of the Act and the manner in which respondent no.12 has conducted the proceedings, there is no doubt in the mind of this court that the liability to deposit the statutory interest in terms of Section 35 of the Act primarily lies on the Collector. It cannot be lost sight of that the awarded compensation had been deposited by the indenting department without any unnecessary delay. The award amount which the Collector was under obligation to deposit in the court in view of the refusal of the private respondents to accept the same, was, however, not deposited by the Collector for the reasons best known to him. He has conveniently chosen not to contest this petition. Whether it is the Collector or the indenting department which is responsible for the mess that has been created in this case, the State is vicariously liable. The private respondents who are not privy to the actions and inactions of the petitioner and respondent no.12 cannot be deprived of their entitlement to statutory interest. 19. In that view of the matter, it would be in the fitness of things to direct the petitioner to first deposit the statutory interest in terms of Section 35 which has accrued on the award amount from 27th January, 1999 till 23rd February, 2013 in the reference court. It shall, however, be open to the State to recover the same from the concerned Collector who had failed to follow the mandate of Section 32 of the Act by launching appropriate proceedings. The decision in this regard is, however, left for the Chief Secretary of the State to take. In Re: question No.(iii): 20. This question is no longer res integra. This Court in the case of Sansar Chand & ors., v. Chief Secretary, Rev. Deptt. & Ors : 2012 (IV) SLJ 1084 (HC) relying upon the judgment of the Supreme Court reported in AIR 1964 SC 1878 (Dr. Shamlal Narula v. Commissioner of Income Tax Punjab) held that when the interest is not awarded by the Collector, the aggrieved parties can invoke the remedy of seeking reference under Section 18 of the Act. Deptt. & Ors : 2012 (IV) SLJ 1084 (HC) relying upon the judgment of the Supreme Court reported in AIR 1964 SC 1878 (Dr. Shamlal Narula v. Commissioner of Income Tax Punjab) held that when the interest is not awarded by the Collector, the aggrieved parties can invoke the remedy of seeking reference under Section 18 of the Act. The provisions of Section 18 of the Act are wide enough to clothe the reference court with the power to direct the Collector to deposit the compensation be it principal amount or the interest accrued thereon. 21. The scope of proceedings under Section 18 is clearly delineated in Section 21 of the Act which, for facility of reference, is reproduced herein:— “21. Restriction on scope of proceedings.—The scope of the enquiry in every such proceeding shall be restricted to a consideration of the interests of the persons affected by the objection.” 22. Section 21 of the Act when read in conjunction with Section 19 of the Act, would leave no doubt that the reference court is competent enough to direct the Collector to deposit not only the amount of compensation but the statutory interest accrued thereon in terms of Section 35 of the Act. 23. In view of the answers to the questions formulated above and the discussion made above, this petition is found to be without any merit and is accordingly dismissed. 24. Let a copy of this order be placed before the Chief Secretary of the State who shall take appropriate decision with regard to launching of appropriate proceedings against the then Collector on account of whose failure the amount was not deposited in the Court.