S. 18(2) LA Act- Cannot Dismiss Reference Applications As Barred By Limitation If Liberty Reserved By HC- Supreme Court

A Supreme Court Bench of Justice MR Shah and Justice CT Ravikumar has held that in view of the liberty reserved by the High Court in favor of the Appellants to pursue remedy as may be available to them for enhancement of compensation, the reference application could not have been dismissed as barred by limitation under Section 18(2) of the Land Acquisition Act, 1894.

Senior Advocate Shyam Divan appeared for the Respondent side, and Counsel Deepanwita Priyanka appeared for the State.

In this case, the Gujarat High Court dismissed the appeal and confirmed the order passed by the Reference Court, which had rejected the reference under Section 18 of the Act as barred by limitation. Aggrieved, the Appellants approached the Supreme Court.

The Supreme Court made the observation that "in view of the liberty reserved by the High Court in favour of the appellants to pursue such remedy as may be available to them for enhancement of compensation, the reference application could not have been dismissed as barred by limitation under Section 18(2) of the Act, 1894. Within a period of six months from the date of dismissal of the special leave petition, the reference was filed."

The Court noted that "though in the writ petition before the High Court (in the earlier round of litigation) they challenged the award under Section 12(2) of the Act and the High Court observed that it is too late to make any grievance, still the High Court while dismissing the writ petition reserved liberty in favour of the appellants to initiate appropriate proceedings for enhancement of the compensation."

On a fair reading of the entire judgment and order passed by the High Court, the Supreme Court held that "on a fair reading of the entire judgment and order passed by the High Court, the observations made that it is too late to make the grievance with respect to the inadequacy of the compensation, those observations are to be read while considering the prayer of the appellants challenging the acquisition proceedings. It appears that the acquisition was also challenged on the ground that the amount awarded is inadequate. To that, the observations were made by the High Court that it is too late to raise such a dispute. Therefore, the High Court ought to have interfered with the decision of the reference Court dismissing the reference on the ground of limitation and ought to have remitted the matter to the reference Court to decide the reference on merits."

Therefore, the Supreme Court allowed the appeal and remitted the matter back to the reference court to decide the reference on merits. The reference court was directed to decide and dispose of the reference within nine months, and no orders were issued as to costs.

Cause Title: Manharlal Shivlal Panchal & Others v. The Deputy Collector & Special Land Acquisition Officer & Others

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