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Friday, February 1, 2013

evacuee property - the appeal must fail. In the first place, as noticed above, by approval of the highest bid given by the appellant’s husband followed with provisional possession, an encumbrance was created in 1960 in the subject land which was part of the compensation pool before the acquisition proceedings were initiated and, therefore, it could have been acquired by the Delhi Administration under the LA Act. Secondly, and equally important, the acquisition which was commenced by Section 4 read with Section 17(1)(iv) Notification issued on 07.03.1962 which ultimately culminated into an award on 30.06.1962 was challenged for the first time after more than thirty years of the passing of the award. The appellant has failed to show her title or her husband’s title in the property on the date of the acquisition. As a matter of fact, though the approval to the highest bid given by the appellant’s husband in respect of the subject property was given on 31.10.1960, the payment of full price by the appellant was made pursuant to the communication dated 16.06.1980 but by that time the subject land already stood acquired by the Delhi Administration and, therefore, despite the payment of full price by the appellant in 1980 and the issuance of the sale certificate, no title came to be vested in the appellant. The legal position that we have summarised with regard to transfer of title in respect of the property forming part of the compensation pool put to public auction under Rule 90 of the 1955 Rules in the earlier part of the judgment does not help the appellant at all because of completion of acquisition proceedings in 1962 much before the payment of full purchase price by the appellant. In the absence of any title in favour of the appellant or her husband on the date of acquisition, the challenge to such acquisition could not have been allowed by the Single Judge. The Division Bench rightly set aside the erroneous order of the Single Judge. In view of the above, appeal has no merit and is liable to be dismissed and is dismissed with no order as to costs. 49. It is, however, clarified that appellant’s claim for compensation, refund or any other monetary claim shall be considered and/or decided on its own merits in accordance with law and the present judgment shall have no bearing in relation to such claim.


                                                                  REPORTABLE


                        IN THE SUPREME COURT OF INDIA


                        CIVIL APPELLATE JURISDICTION


                        CIVIL APPEAL NO. 4373 OF 2009


Saraswati Devi (D) By LR.                             ……  Appellant


                         Vs.


Delhi Devt. Authority & Ors.                                ……  Respondents


                                  JUDGMENT


R.M. LODHA, J.




              This is an appeal by the appellant  against  the  decision  of
the Division Bench of the Delhi High Court on 31.05.2007,  in  allowing  the
Letters Patent Appeal (LPA) preferred by  the  Delhi  Development  Authority
(DDA) against the decision of the Single Judge dated  09.08.2002.  Leave  to
appeal was granted by this Court on 13.07.2009.
2.          The facts which  form  the  background  of  the  appeal  can  be
briefly stated  as follows :
The controversy relates to  a   piece  of  land
admeasuring 5 Bighas 19 Biswas comprised in Khasra No. 368  situate  in  the
revenue village  Masjid Moth, New Delhi. 
The above property was  an  evacuee
property which was acquired by the central government under  Section  12  of
the Displaced Persons  (Compensation  and  Rehabilitation)  Act,  1954  (for
short, ‘1954 Act’). 
On acquisition of that property  under  Section  12,  it
became part of the compensation pool under Section 14. 
By  exercise  of  the
power conferred under Section 20,  the above property  was  notified  to  be
sold by way of public auction on 21.06.1958.
 3.         Dev Prakash Jagwani, the appellant’s husband being  a  displaced person participated in the public auction for the sale of  above  property.
His bid of Rs. 24,500/- which was the highest bid was accepted.
 4.          On  31.10.1960,  the  office  of   the   Assistant   Settlement
 Commissioner  (Rural),  Ministry  of  Rehabilitation   intimated   to   the
 appellant’s husband that it  has  been  decided  to  give  him  provisional
 possession of the auctioned property subject to the  terms  and  conditions
 stipulated in the indemnity bond and the special affidavit already executed
 by him. He was also informed that the issue of the above intimation did not
 constitute transfer of complete title  in  the  property  until  the  final
 letter of adjustment of compensation was issued.
5.          The appellant’s husband  is  said  to  have  died  in  1970.  On
16.06.1980, a letter was received from the Ministry of Rehabilitation  by  a
friend of the appellant’s late husband requiring the deposit  of  a  sum  of
                    Rs. 14,992/-  towards  balance  price  of  auction  sale
within fifteen days. The appellant deposited the balance price.
6.          On  22.08.1980,  a  sale  certificate  as  contemplated  by  the
Displaced Persons (Compensation and Rehabilitation) Rules, 1955 (for  short,
‘1955  Rules’)  was  issued.   On  15.07.1981  the  sale   certificate   was
registered with the Sub-Registrar.
7.          Between 31.10.1960 when the appellant’s  husband  was  intimated
that his bid had been approved  in  respect  of  the  above  property;   the
payment of full price by the appellant pursuant to the  communication  dated
16.06.1980; the issuance  of  sale  certificate  dated  22.08.1980  and  its
registration thereof on  15.07.1981,  an  important  event  took  place.  On
07.03.1962, the Delhi Administration, Delhi   issued  a  Notification  under
Section 4 read with Section 17(1)(iv) of  the  Land  Acquisition  Act,  1894
(for  short,  ‘LA  Act’)  proposing  to  acquire  a  large  tract  of   land
admeasuring 198 Bighas  and  11  Biswas  which  included  the  subject  land
situate at Masjid  Moth  for  the  public  purpose,  namely,  for  the  plan
development of Delhi.  Since the urgency clause under Section  17(1)(iv)  of
the LA Act was invoked, the provisions of Section 5A  were  dispensed  with.
The declaration under Section 6 was made and later on award  was  passed  on
30.06.1962.
8.          It is the appellant’s case that somewhere  in  1981,  after  the
sale  certificate  was  registered,  one  Mr.  Chhugani,  a  friend  of  the
appellant’s late  husband, learnt about the acquisition of the subject  land
and he made representations to the authorities. It is further  case  of  the
appellant that a  notice in Land Acquisition Case  No.  72/85  was  received
by Mr. Chhugani for 11.08.1992 which was communicated to the appellant.  The
appellant  initially  filed  a  suit  but  later  on  challenged  the  above
acquisition before the Delhi  High  Court  by  filing  a  writ  petition  on
10.08.1993.
9.          The challenge to the acquisition after more  than  30  years  of
the passing of the award was principally founded on the ground that  at  the
relevant time in 1962, the land belonged to the central government being  an
evacuee land acquired under Section 12 of the 1954 Act and as such the  said
land could not have been acquired under the LA Act.
10.         DDA was not impleaded as party respondent initially   but  later
on it was impleaded as Respondent No. 4 in the  writ  petition.   DDA  filed
its written response in opposition to the writ petition and raised the  plea
of delay and laches. In its reply, DDA submitted that  the  physical  vacant
possession of the land was taken on 11.07.1962 after the  award  was  passed
on 30.06.1962  and  the  subject   land  was  placed  at  its   disposal  on
09.02.1981. It was also submitted  by  DDA  that  though  the  property  was
conveyed to the petitioner (appellant herein)  on  22.08.1980  but  she  was
declared purchaser of the said property with  effect  from  11.12.1960  and,
thus, the subject land  ceased  to  be  government  land  with  effect  from
11.12.1960 and whatever rights the appellant had  could  be  acquired  under
the LA Act.
11.         In light of the rival  position  set  up  by  the  parties,  the
Single Judge framed two questions for consideration :
(i)   Whether the land in question was an evacuee land on the date of  issue
of Notification under Section 4 of the LA Act on 07.03.1962?
(ii)  Whether the land, if it was  an  evacuee  property,  could  have  been
acquired under the law?

12.         The Single Judge was not persuaded by  the  plea  of  delay  and
laches.  He considered the provisions of  the  1954  Act  and  the  relevant
procedure of auction sale prescribed in the 1955 Rules.  He  referred  to  a
decision of this Court in Bishan Paul v. Mothu Ram[1], few decisions of  his
own High Court including Nanak Chand Sharma v. Union of India and  others[2]
and Sham Sunder Khanna v. Union of India[3] and a decision  of   the  Punjab
High Court.   On consideration of the above provisions and  the  precedents,
the Single Judge allowed the writ petition; quashed the  Notification  dated
07.03.1962 issued  under  Section  4  of  the  LA  Act  and  the  subsequent
proceedings in the Land Acquisition Case No. 72/85.
13.         DDA challenged the decision of  the  Single  Judge  in  LPA  and
since it suffered from the delay of 760 days, an application  was  made  for
condonation of delay.
14.         The Division Bench of the Delhi High Court observed  that  there
was delay of about 760 days in filing the LPA  against the decision  of  the
Single Judge but, at the same time, there was delay of more  than  31  years
on  the  part  of  the  writ  petitioner  in  challenging  the   acquisition
proceedings and since there was delay on the part  of  both  sides  and  the
question related to valuable rights in the land, the delay on  the  part  of
either of the parties should not come in the way of doing justice.  This  is
what the Division Bench observed:
           “6.  There is delay of about 760 days in filing of this  appeal.
           The appellant has filed an application (CM  No.  2093/2005)  for
           condonation of the said delay. This application is supported  by
           the affidavit of Mr. S.P. Pandey, Director,  LM  (HQ)  DDA.  The
           appellant had contended in its application  for  condonation  of
           delay that the delay of 760 days in filing  of  the  appeal  was
           neither willful nor due to negligence but was due  to  the  time
           consuming and unavoidable administrative procedures  which  have
           to be gone through in cases  like  the  preset  one,  where  the
           Government is the  litigant  and  decisions  have  to  be  taken
           collectively. It is further contended that the appellant had  to
           collate  documents,  administrative  orders,  judgments  of  the
           Supreme Court and various other records for preparation  of  the
           present  appeal.  The  request  made  by   the   appellant   for
           condonation of the delay is opposed by the counsel appearing  on
           behalf  of  the  respondent  No.  1  on  the  ground  that   the
           explanation given by the appellant for delay in  filing  of  the
           present appeal is unsatisfactory.  We  have  given  our  anxious
           consideration to this aspect relating to condonation  of  delay.
           While considering the  delay on the part  of  the  appellant  in
           filing of the present appeal, we have also  taken  into  account
           the delay of more than 31 years on the part of respondent No.  1
           in challenging  the  acquisition  proceedings  by  way  of  writ
           petition in which the impugned order which is the subject matter
           or challenge in this appeal has been opposed. We are of the view
           that since the question in the present  proceedings  relates  to
           valuable rights of the parties in  the  land  in  question,  the
           delay on the part of either of the parties cannot be allowed  to
           come in the way of doing justice. We are  further  of  the  view
           that when substantial justice and  technical  consideration  are
           pitted against each other, cause of substantial justice deserves
           to be preferred. We feel that by delay, the appellant would  not
           stand to gain anything and at best he would only be entitled  to
           get his claim adjudicated on merits instead of it  being  thrown
           to winds on technical consideration of delay in  filing  of  the
           appeal. Having regard to the circumstances of the case,  we  are
           inclined to condone the delay in filing of the  present  appeal.
           The delay is accordingly condoned and the appeal is taken up for
           disposal on merits.”


15.         On consideration of the matter on  merits,  the  Division  Bench
was of the view that the decision of Single Judge was unsustainable in  view
of the Division  Bench  decision  of  that  Court  in  M.S.  Dewan[4].   The
Division  Bench  also  relied  upon  a  decision  of  this  Court  in  Delhi
Administration  and  Others  v.  Madan  Lal  Nangia   and   Others[5].   The
consideration  of  the  matter  by  the  Division  Bench  is  reflected   in
paragraphs 10,11 and 12 of the judgment which read as under:
           “10.  It may be seen  from  the  above  judgment  in  Madan  Lal
           Nagia’s case (Supra) that the Supreme  Court  has  categorically
           held that even if there is a finding that the property  acquired
           was an evacuee  property  on  the  date  of  Notification  under
           Section 4 of  the  Land  Acquisition  Act,  the  acquisition  in
           respect of the said land would still be valid.
           11.   The acquisition of land on similar facts, as  are  in  the
           present case, was upheld by a Division Bench of  this  Court  in
           case titled ‘M.S. Dewan v. UOI & Ors., CWP No. 1400/1986 decided
           on 06.02.2003. In M.S. Dewan’s case (Supra) a Division Bench  of
           this Court had upheld the acquisition of  evacuee  property  and
           dismissed the writ  petition  of  the  auction  purchaser.  Even
           S.L.P. (Civil) No. 71152/2003 filed  by  the  auction  purchaser
           against the aforementioned  decision  of  this  Court  was  also
           dismissed by the Hon’ble Supreme Court. Hence the view taken  by
           this Court in M.S. Dewan’s case became final. Hence it would  be
           relevant and necessary to refer to para 23 of the said  judgment
           which is extracted here-in-below:-


                 “We have already held above that the title in the  property
           passed in favour of the petitioner on 14.11.1961. Even  assuming
           that the title had not passed to the petitioner till 22.07.1963,
           when sale certificate was issued, in that case also  we  do  not
           find any substance in the  submission  made  on  behalf  of  the
           petitioner that the property could not have  been  notified  for
           being  acquired  being  the  property  of  the  Government  till
           22.07.1963 and the Government could not have  acquired  its  own
           property. The reason in our holding so is that the  property  on
           being put to auction on 28.12.1960, the petitioner was  declared
           to be the highest bidder against  his  verified  claims  of  the
           property left  behind  in  Pakistan  the  verified  claims  were
           surrendered by him as a part of consideration  for  purchase  of
           the  property  in  question  in  public  auction.  The   balance
           consideration was paid in cash. The entire  consideration  stood
           paid by 14.11.1961. The right of the petitioner in the  property
           on being declared to the highest bidder was  a  valuable  right,
           which the petitioner could enforce against  the  respondents  in
           compelling the respondent to transfer the property in his  name.
           Such a right could be acquired. The property  on  being  put  to
           auction and on the petitioner being declared to be  the  highest
           bidder and on receipt of entire sale consideration went  out  of
           compensation pool. The petitioner  alone  had  interest  in  the
           property. This interest could definitely be acquired pursuant to
           the notification issued under Section 4 of the  Act.  Therefore,
           it cannot be said that the notification under section 4  of  the
           Act was non est. It was for the  petitioner  to  have  raised  a
           claim. Proceedings for acquisition thus cannot be challenged  on
           the ground that such interest  could  not  have  been  acquired.
           Therefore, no fault can  be  found  in  the  notification  under
           Section 4 of the Act.”


           12.   The question that needs our consideration in  the  present
           appeal is squarely covered by the above judgment of  this  Court
           in M.S. Dewan’s case.  The facts of the present case as well  as
           that  of  M.S.  Dewan’s  case  are  almost  same.  It  has  been
           categorically held in M.S. Dewan’s case that the right  held  by
           the  auction  purchaser  can  be  legally  acquired  by  way  of
           Notification  under  Section  4  of  the  Land  Acquisition  Act
           notwithstanding the transfer of title  in  respect  of  land  in
           question in his favour. We  respectfully  agree  with  the  view
           already taken by this Court in the aforesaid case. Hence we have
           no hesitation in holding that  Learned  Single  Judge  erred  in
           holding that the property in question was an evacuee property on
           the date of Notification dated 07.03.1962 and  in  quashing  the
           said Notification for that reason. The view so taken by  Learned
           Single Judge in the impugned order thus cannot be  sustained  in
           law particularly in view of the above referred judgment  of  the
           Supreme Court and of this Court.”




15.1.       The Division Bench, accordingly, set  aside  the  order  of  the
Single Judge passed on 09.08.2002 and allowed the appeal of  DDA  with  cost
throughout.
16.         Before us, Mr. Ranjit Kumar,  learned  senior  counsel  for  the
appellant, vehemently argued that the appellant acquired the  title  in  the
land on the day the full sale consideration was paid in 1980  and  prior  to
that date the land belonged to the central government and as such  it  could
not have been acquired under the LA Act by  the  Delhi  Administration.   He
highlighted the facts relating to auction of  the  subject  land  which  was
conducted on 21.06.1958; approval of the  highest  bid  of  the  appellant’s
husband by the Settlement Commissioner  on  31.10.1960,  communication  from
the Ministry of Rehabilitation dated 16.06.1980  requiring  the  deposit  of
Rs. 14,992/- as balance sale consideration, deposit of that  amount  by  the
appellant within fifteen days  thereof;  issuance  of  sale  certificate  on
22.08.1980 and its registration on 15.07.1981 and submitted that  until  the
full price was paid,  the appellant (auction purchaser)  acquired  no  right
in  the  land  of  any  nature  and  the  land  remained  with  the  central
government. In this regard, he relied upon decisions  of   the  Punjab  High
Court in Roshan Lal Goswami v. Gobind Raj & Ors.[6]  and Jaimal  Singh,  s/o
Jawahar Singh & Anr.  v. Smt. Gini Devi[7] and the decisions of  this  Court
in M/s. Bombay Salt & Chemical Industries v. L.J. Johnson & Ors.[8],  Bishan
Paul1, Dr. Bhargava & Co. and another v. Shyam Sunder Seth  by  LRS.[9]  and
Hans Raj Banga v. Ram Chander Aggarwal[10].
17.         Mr. Ranjit Kumar heavily relied upon the decision of this  Court
in Sharda Devi v. State of Bihar and another[11] in support of his  argument
that so long as title vests with the central government, the land cannot  be
acquired  under  the  LA  Act.   He  argued  that  under  the  LA  Act,  the
acquisition is of land and not the ‘rights in the land’  which are not  even
absolute and which are subject to certain obligations.
18.         Mr. P.P. Malhotra, learned Additional Solicitor General and  Mr.
Amarendra Sharan, learned  senior  counsel  for  DDA   conversely  not  only
supported the final conclusion  of  the  Division  Bench  in  upsetting  the
judgment of the Single Judge but also vehemently argued that  writ  petition
filed by the appellant was liable to be dismissed on the  grounds  of  delay
and laches of more than 30 years and suppression of material facts  inasmuch
as the writ petition in the High Court was  supported  by  an  affidavit  of
J.K. Jagwani claiming himself to be power of attorney holder while one  Devi
Dayal Jagwani is a registered power of attorney  holder  of  the  appellant.
It was also submitted that present appeal is a proxy appeal at the  instance
of J.K. Jagwani who has purchased the subject property by a registered  sale
deed dated 28.02.2003.
19.          Mr.  P.P.  Malhotra,  learned   Additional  Solicitor   General
further argued  that on approval of the bid of  the  appellant’s  husband  a
binding contract came into existence between the central government and  him
which amounted to ‘encumbrance’ and, therefore, there was no  impediment  in
acquisition of the subject  land under the LA Act.
20.         On behalf of the respondents, heavy reliance was placed on   the
decision of this Court in Madan Lal Nangia5 .
21.         Mr. Amarendra Sharan, learned senior counsel for the  DDA   also
submitted that the subject land was placed at the disposal of DDA  way  back
in 1981 and subsequently it has been allotted  to  All  India  Institute  of
Medical Sciences (AIIMS) which has also taken possession of the said land.
22.         In rejoinder, Mr. Ranjit Kumar and Mr. Vijay  Hansaria,  learned
senior counsel for the appellant submitted that there was  nothing  to  show
that AIIMS has been allotted the above  land.  In  the  written  submissions
filed by the appellant, it is stated that there is no land  in  Masjid  Moth
ever given to AIIMS.  In this regard, reference has been made to  the  reply
received pursuant to  the  query  made  by  the  appellant  under  Right  to
Information Act.   They denied that appeal was a proxy litigation.   It  was
submitted that J.K. Jagwani, power  of  attorney  holder,  was  one  of  the
family members residing in Delhi; the  family  had  purchased  the  property
from their verified claim and the sale certificate was issued in  favour  of
Smt. Saraswati Devi who under the  family  settlement  transferred  part  of
land in favour of J.K. Jagwani and other family members.
23.         The approach  of  the  Division  Bench  of  the  High  Court  in
offsetting the  delay and laches of more than 30 years  in  challenging  the
acquisition proceedings with the delay of 760 days in filing the  LPA  is  a
little strange and though does not commend  to us but we do  not  intend  to
disturb the finding of  the Division Bench on this aspect  in  view  of  the
appropriate final conclusion in the matter.
24.         The principal contention  on  behalf  of  the  appellant  raised
before us (which was also argued before the Single Judge  and  the  Division
Bench of the High Court) is that  on  the  date  of  the  acquisition,   the
subject property vested in  the  central  government  having  been  acquired
under Section 12 of the 1954 Act;  the title in that land did  not  transfer
in favour of the appellant’s husband despite  public  auction  conducted  on
21.06.1958 and the approval of the highest  bid  given  by  the  appellant’s
husband on 31.10.1960, as the full price had only been paid in 1980  by  the
appellant  (her  husband  had  died  in  the  meanwhile),  and,   therefore,
acquisition of the subject land in 1962 under the LA Act at the instance  of
the Delhi Administration was bad  in law. In  this  regard,  heavy  reliance
has been placed on behalf of the appellant upon the decision of  this  Court
in Sharda Devi11.  We shall first refer to the decision  of  this  Court  in
Sharda Devi11.
25.         In Sharda Devi11, this Court was  concerned  with  the  question
whether the State could proceed to acquire land on  an  assumption  that  it
belonged to a particular  person,   whether  in  such  situation  the  award
passed by the land acquisition officer could be called in  question  by  the
State seeking a reference under Section 30 of the  LA  Act  on  the  premise
that the land did not belong to the person  from  whom  it  was  purportedly
acquired and was a land owned by the State  having vested in it,  consequent
upon abolition of proprietary rights,  much  before  the  acquisition.  This
Court examined and analysed provisions of the LA  Act  and  also  considered
few earlier decisions of this Court and the decisions of some  high  courts.
Considering the question in light of the above, this Court held as under:
           “27. We have entered into examining the scheme of  the  Act  and
           exploring the difference between reference under Section 18  and
           the one under Section 30 of the Act  as  it  was  necessary  for
           finding out answer to the core question staring before  us.  The
           power to acquire by the State the land  owned  by  its  subjects
           hails from the right of eminent  domain  vesting  in  the  State
           which is essentially an attribute  of  sovereign  power  of  the
           State. So long as the public purpose subsists, the  exercise  of
           the power by the State to  acquire  the  land  of  its  subjects
           without regard to the wishes or  willingness  of  the  owner  or
           person interested in the land cannot be questioned. (See Scindia
           Employees' Union v. State of Maharashtra [(1996)  10  SCC  150],
           SCC para 4 and State  of  Maharashtra  v.  Sant  Joginder  Singh
           Kishan Singh [1995 Supp (2) SCC 475], SCC  para  7.)  The  State
           does not acquire its own land for it is futile to  exercise  the
           power of eminent domain for acquiring rights in the land,  which
           already vests in the State. It would be absurdity to  comprehend
           the provisions of the Land Acquisition Act being  applicable  to
           such land wherein  the  ownership  or  the  entirety  of  rights
           already vests in the State. In other words, the  land  owned  by
           the State on which there are no private rights  or  encumbrances
           is beyond the purview of the provisions of the Land  Acquisition
           Act. The position of law is so clear as does not stand  in  need
           of any authority for support. Still a few decided cases in point
           may be referred since available.
           28. In Collector of Bombay v. Nusserwanji Rattanji  Mistri  [AIR
           1955 SC 298] this Court held that 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 land, it has only to acquire the other interests
           outstanding thereof so that it might be in a position to pass it
           on absolutely for  public  user.  An  interesting  argument  was
           advanced before the Supreme Court. It  was  submitted  that  the
           right of the Government to levy assessment on the  lands  is  an
           “encumbrance” and that encumbrance is  capable  of  acquisition.
           The Court held that  the  word  “encumbrance”  as  occurring  in
           Section 16 can  only  mean  interests  in  respect  of  which  a
           compensation was made  under  Section  11  or  could  have  been
           claimed. It cannot include the right of the Government  to  levy
           assessment on the  lands.  The  Act  does  not  contemplate  the
           interest  of  the  Government  in  any  land  being  valued   or
           compensation being awarded therefor.
           29. In Secy. of State v. Sri Narain Khanna [AIR 1942 PC  35:  44
           Bom LR 788]  it was held that where the Government acquires  any
           property consisting of land and buildings and where the land was
           the subject-matter of the government grant, subject to the power
           of resumption by the  Government  at  any  time  on  giving  one
           month's notice,  then  the  compensation  was  payable  only  in
           respect of such buildings as may  have  been  authorized  to  be
           erected and not in respect of the land.
           30. In the matter of the Land Acquisition Act: Govt.  of  Bombay
           v. Esufali Salebhai [ILR (1910) 34 Bom 618 : 12 Bom LR  34]  ILR
           (at p. 636) Batchelor, J.  held  that  the  Government  are  not
           debarred from acquiring and  paying  for  the  only  outstanding
           interests merely because the Act, which  primarily  contemplates
           all interests as held outside the Government, directs  that  the
           entire compensation based upon the market  value  of  the  whole
           land must be distributed among the claimants. The Government was
           held liable to acquire and pay only for the superstructure as it
           was already the owner of the land.
           31. In Dy. Collector, Calicut Division v. Aiyavu  Pillay  [9  IC
           341: (1911) 2 MWN 367 : 9 MLT 272] Wallis, J. observed that  the
           Act does not contemplate or provide for the acquisition  of  any
           interest which already belongs to the 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  belong  to  the
           Government.
           32. In Collector of Bombay v. Nusserwanji Rattanji  Mistri  [AIR
           1955 SC 298] the decisions in Esufali Salebhai case [ILR  (1910)
           34 Bom 618 : 12 Bom LR 34]  and Aiyavu Pillay case  [9  IC  341:
           (1911) 2 MWN  367  :  9  MLT  272]  were  cited  with  approval.
           Expressing its entire agreement with the said views,  the  Court
           held that when the Government  possesses  an  interest  in  land
           which is the subject of acquisition under the Act, that interest
           is itself outside such  acquisition  because  there  can  be  no
           question of  the  Government  acquiring  what  is  its  own.  An
           investigation into the nature and  value  of  that  interest  is
           necessary for  determining  the  compensation  payable  for  the
           interest outstanding in the claimants but that would not make it
           the subject of acquisition. In the land acquisition  proceedings
           there is no value  of  the  right  of  the  Government  to  levy
           assessment on the lands and there is no  award  of  compensation
           therefor. It  was,  therefore,  held  by  a  Division  Bench  of
           Judicial Commissioners in Mohd. Wajeeh Mirza v. Secy.  of  State
           for India in Council [AIR 1921 Oudh 31: 24 Oudh  Cas  197]  that
           the question of title arising between the Government and another
           claimant cannot be settled by the Judge  in  a  reference  under
           Section 18 of the Act. When the Government itself claims  to  be
           the owner  of  the  land,  there  can  be  no  question  of  its
           acquisition and the  provisions  of  the  Land  Acquisition  Act
           cannot be applicable. In our opinion the  statement  of  law  so
           made by the learned Judicial Commissioners is correct.”


26.         This Court answered the  question  under  consideration  in  the
negative and held that the acquisition of land wherein the ownership or  the
entirety of rights already vested in the  State  on  which  there  were   no
private rights or encumbrances, such land was beyond the purview of LA  Act.
We agree with the position of law  highlighted  in  Sharda  Devi11  but  the
question is of its applicability on the factual  situation  of  the  present
case. Before we consider this aspect, we may also deal  with  the  statutory
provisions and the decisions of this Court and  the  two  decisions  of  the
Punjab High Court  upon which strong reliance has been placed on  behalf  of
the appellant in support of the argument that acceptance of the highest  bid
in  public auction under Rule 90 of the 1955 Rules for sale of the  property
forming part of the compensation pool does not create any title or right  in
favour  of  the  auction-purchaser  unless  the  full   auction   price   is
paid/deposited.
27.         By virtue of Section 14 of the 1954  Act,  an  evacuee  property
acquired under Section  12  becomes  part  of  the  compensation  pool.  The
compensation  pool  vests  in  the  central   government   free   from   all
encumbrances.  Section  20  empowers  the  managing  officer   or   managing
corporation to transfer any property out of the  compensation  pool  subject
to the 1955 Rules. Chapter XIV of the 1955 Rules provides for the  procedure
for sale of property in the compensation pool. Rule  87  provides  that  the
property forming part of compensation pool may be sold by public auction  or
by inviting tenders.  Rule  90  provides  for  the  procedure  for  sale  of
property by public auction. The said rule, to the  extent  it  is  relevant,
reads as under:
           “90.  Procedure for sale of property by public auction—(1) Where
           any property is to be sold by public auction—
            
                 (a)   The property shall be sold through  firms  of  repute
                       who have been approved as  auctioneer  by  the  Chief
                       Settlement  Commissioner  or  through  the   officers
                       appointed by the Central Government in this behalf;
            
                 (b)   the terms and conditions on which auctioneers may  be
                       appointed shall, from time to time, be determined  by
                       the Chief Settlement Commissioner.
            
                 (2) to (7)   xxx           xxx             xxx
             xxx


                 (8)   The person declared to be the highest bidder for the
           property at the public auction shall pay in cash or by a  cheque
           drawn on a scheduled bank and endorsed “good  for  payment  upto
           six months” or in such other form as  may  be  required  by  the
           Settlement Commissioner, immediately on the fall of the hammer a
           deposit not exceeding 20 per cent of the amount of  his  bid  to
           the officer conducting the sale and in default of  such  deposit
           the property may be resold:


                 Provided that where the  highest  bidder  is  a  displaced
           person having a verified claim, the compensation in  respect  of
           which exceeds the amount of the deposit required under this sub-
           rule, he may, instead of making a deposit, execute an  indemnity
           bond in the form specified in Appendix XXI-A.
                 (9)        xxx       xxx       xxx      xxx
                 (9)(A)           xxx       xxx       xxx      xxx
                 (9) (B).   xxx       xxx       xxx      xxx
            
                 (10)  The bid in respect of which the initial deposit  has
           been accepted shall be subject to the approval of the Settlement
           Commissioner or an officer appointed by him for the purpose.
            
                 Provided that no bid shall be  approved  until  after  the
           expiry of a period of seven days from the date of the auction.
            
                 (11)  Intimation of the approval of a bid or its rejection
           shall be given to the highest bidder (hereinafter referred to as
           the auction purchaser) by registered  post  acknowledgement  due
           and the auction purchaser shall where the bid has been  accepted
           be  required  within  fifteen  days  of  the  receipt  of   such
           intimation to send by registered post acknowledgement due or  to
           produce before the Settlement Commissioner or any other  officer
           appointed by him for the purpose a treasury challan  in  respect
           of the deposit of the balance of the purchase money :
            
                 Provided that the Settlement Commissioner or other officer
           appointed by him in this behalf may, for reasons to be  recorded
           in writing, extend the aforesaid period of fifteen days by  such
           period,  not  exceeding  fifteen   days,   as   the   Settlement
           Commissioner or such other officer may think fit.
            
                 Provided  further  that  the  period  extended  under  the
           preceding proviso may further be extended (without any limit  of
           time) by the Chief Settlement Commissioner.
            
                 (12)  The balance of the purchase money may,   subject  to
           the other provisions of these  rules  be  adjusted  against  the
           compensation payable to the auction purchaser in respect of  any
           verified claim held by  him.   In  any  such  case  the  auction
           purchaser shall be required to furnish within seven days of  the
           receipt of intimation about the approval of the bid, particulars
           of the compensation application filed by him :
            
                 Provided that the Settlement Commissioner or  any  officer
           appointed by him in this behalf may, for reasons to be  recorded
           in writing, extend the aforesaid period of seven  days  by  such
           further period not exceeding  fifteen  days  as  the  Settlement
           Commissioner or such other officer may deem fit:
            
                 Provided  further  that  the  period  extended  under  the
           preceding proviso may further be extended (without any limit  of
           time) by the Chief Settlement Commissioner.
            
                 (13)  If the Regional Settlement Commissioner, on scrutiny
           of the compensation application of the auction  purchaser  finds
           that  further sum is due to make up the purchase price, he shall
           send an intimation to  that  effect  to  the  auction  purchaser
           calling upon him to deposit the balance in cash  within  fifteen
           days of the receipt of such intimation.
            
                 (14)  If  the  auction  purchaser  does  not  deposit  the
           balance of the purchase money within the period specified in sub-
           rule (11) or does not furnish particulars  of  his  compensation
           application as specified  in  sub-rule  (12),  or  if  that  net
           compensation admissible to the auction purchaser is found to  be
           less than the balance of the  purchase  money  and  the  auction
           purchaser does not make up the deficiency as  provided  in  sub-
           rule (13), the initial deposit made  by  the  auction  purchaser
           under sub-rule  (8) shall be liable to forfeiture and  he  shall
           not have any claim to the property.
            
                 (15)  When the purchase price has been  realised  in  full
           from the auction purchaser, the Managing Officer shall issue  to
           him a sale certificate in the form specified in Appendix XXII or
           XXIII, as the  case  may  be.  A  certified  copy  of  the  sale
           certificate shall be sent by  him  to  the  Registering  Officer
           within the local limits of whose jurisdiction the whole  or  any
           part of  the  property  to  which  the  certificate  relates  is
           situated. If the auction purchaser has associated  with  himself
           any other displaced person having a  verified  claim  whose  net
           compensation is to be adjusted in whole or in part  against  the
           purchase price, the sale certificate shall be made  out  jointly
           in the name of all such persons, and shall specify the extent of
           interest of each in the property.


                 Provided that  if  every  such  displaced  person  who  has
           associated  himself  with   the   auction-purchaser   sends   an
           intimation in writing to the  Regional  Settlement  Commissioner
           that the sale certificate may be made out in  the  name  of  the
           auction-purchaser, the sale certificate may be made out  in  the
           name of the auction-purchaser.”

28.          In  Bombay  Salt  &  Chemical  Industries8,  this  Court   with
reference to the public auction of certain  salt  pans  which  were  evacuee
property and formed part of the  compensation  pool  constituted  under  the
1954 Act held in para 10 of the Report as under :
           “10. It is clear from the rules and the conditions of  sale  set
           out above that the declaration that a  person  was  the  highest
           bidder at the auction does not amount to  a  complete  sale  and
           transfer of the property to him. The fact that the bid has to be
           approved by the Settlement Commissioner  shows  that  till  such
           approval which the  Commissioner  is  not  bound  to  give,  the
           auction-purchaser has no right at all. It would  further  appear
           that even the approval of the bid by the Settlement Commissioner
           does not amount to a transfer of property for the purchaser  has
           yet to pay the balance of  the  purchase  money  and  the  rules
           provide that if he fails to do that he shall not have any  claim
           to the property. The correct position is that on the approval of
           the bid by the Settlement Commissioner, a binding  contract  for
           the sale of the property to  the  auction-purchaser  comes  into
           existence. Then the provision as to the sale  certificate  would
           indicate that only upon the  issue  of  it  a  transfer  of  the
           property takes place. Condition of Sale  No.  7  in  this  case,
           furthermore, expressly stipulated that upon the payment  of  the
           purchase price in full the ownership would be transferred and  a
           sale certificate issued. It is for the appellants to  show  that
           the property had been transferred. They have not stated that the
           sale certificate  was  issued,  nor  that  the  balance  of  the
           purchase money had been paid. In those circumstances, it must be
           held that there has as yet been no transfer of the salt pans  to
           Respondents 4 and 5. The appellants cannot therefore  claim  the
           benefit of Section 29 and ask that they should not  be  evicted.
           Mr. Purshottam Trikamdas contended  that  the  sale  certificate
           will in any event be granted and that once it is granted, as the
           form of this certificate shows, the transfer will relate back to
           the date of the auction. It is enough to say in answer  to  this
           contention that assuming it to be right, a point which is by  no
           means obvious and which we do not decide, till it is granted  no
           transfer with effect from any date whatsoever  takes  place  and
           none has yet been granted.”

29.         In Bishan Paul1, a two-Judge Bench of this Court  observed  that
in Bombay Salt & Chemical Industries8  this Court did  not  directly  decide
the question when title would pass  to an  auction-purchaser.  It  was  held
that title  would  pass  when  the  full  price  was  realized.  This  Court
observed having regard to the time lag between  acceptance  of  the  highest
bid, payment of full price and the issuance of certificate, that title  must
be deemed to have been passed when the sale became  absolute  and  the  sale
certificate must relate back to  that  date,  i.e.,  when  the  sale  became
absolute.
30.         In Roshan Lal Goswami6, a Division  Bench  of  the  Punjab  High
Court, on examination of the provisions of the 1954 Act and Rule 90  of  the
1955 Rules, held that till a sale certificate  was  issued  to  the  highest
bidder and till the balance of the purchase money had been paid,  rights  of
ownership would not  vest  in  the  auction-purchaser  and  the  proprietary
rights, therefore, would not stand transferred by the  mere  fact  that  the
highest  bid of the auction-purchaser has been accepted. The Division  Bench
of the  Punjab  High  Court  noticed  the  lacuna  in  the  1954  Act  about
transitional stage after the acceptance of the highest bid  at  the  auction
and till the sale certificate was granted. Pertinently, with regard  to  the
provisional possession given to the auction-purchaser on acceptance  of  the
highest bid, the Division Bench of the Punjab High Court observed as  under:

           “8. After provisional possession has been  given,  the  auction-
           purchaser, even though he does not possess  proprietary  rights,
           has possessory rights. He has the right of possession which  can
           exist independently of ownership. Possession and  ownership  may
           co-exist but in a number of cases a person may be the owner of a
           thing and not possess it; and conversely, a person  may  be  the
           possessor without being the owner. A person, who is a  possessor
           but not the legal owner, is entitled to certain rights by virtue
           of his possession alone. . . . . . . . .   .”
31.         In Jaimal Singh7, the Punjab  High Court,  after  noticing  Rule
90 of the 1955 Rules, in para 16 of the Report, inter alia, held as under:
            “………..In my view, title passes  when  the  sale  is  confirmed,
           because it is  that  date  on  which  the  auction-purchaser  is
           recognised officially as the owner and  is  entitled  to  obtain
           possession of the property.  The issue of the  sale  certificate
           is invariably delayed because certain routine  formalities  have
           to be complied with and it is in very rare cases that an  office
           can be so prompt as to issue the sale certificate  on  the  very
           day the sale is  confirmed.  But  when  a  sale  certificate  is
           issued, it dates back to the date when the sale was confirmed.”

32.         The legal position with regard to transfer of title  in  respect
of the property forming part of the compensation pool put to public  auction
under Rule 90 of the 1955 Rules may be summarized thus : on approval of  the
highest  bid by the Competent Authority,  a binding contract  for  the  sale
of the property to the auction-purchaser comes  into  existence.   Once  the
payment of the full purchase price is made,  title  in  the  property  would
pass to an auction-purchaser. In other words, on the  payment  of  the  full
purchase price, the ownership in the property sold in public  auction  would
stand transferred but the transfer formally becomes  complete   on  issuance
of the certificate of sale.  If in the  sale  certificate,   any  particular
date is mentioned as provided in the proforma  appended  to  Rule  90,  such
date  mentioned in the sale certificate may  be presumed to be the  date  on
which the purchase has become effective but crucial  date  for  transfer  of
ownership in the property in favour of auction-purchaser is  the  date  when
full purchase price has been paid by the auction-purchaser.
 33.        The above being the legal  position,  let  us  recapitulate  the
facts and the effect of provisional  possession  given  to  the  appellant’s
husband.  The auction of the subject land was conducted on  21.06.1958.  The
highest bid submitted by  the  appellant’s  husband  was  approved   by  the
Settlement Commissioner and a communication  to  that  effect  was  sent  on
31.10.1960  intimating  to  him  that  it  has  been  decided  to  give  him
provisional possession of the auctioned property.  It is  an  admitted  case
that  provisional possession was in fact given to the  appellant’s  husband.
On 16.06.1980,  the  concerned  authority  asked  the  auction-purchaser  to
deposit Rs. 14,992/- as balance sale consideration which  was  done  by  the
appellant within the prescribed time (appellant’s husband had  died  in  the
meanwhile) and sale certificate was issued in favour  of  the  appellant  on
22.08.1980. The said sale certificate was registered on 15.07.1981.  It  may
be noticed here that the sale certificate  mentions that the  appellant  has
been declared purchaser of the subject property with effect from  11.12.1958
but as a matter  of  law  as  indicated  above,  the  ownership  could  have
transferred in favour of the appellant only  in  1980  when  she  paid  full
purchase price.  In fact no ownership  was  transferred  in  favour  of  the
appellant  even on that date.  We  shall  indicate  the  reason  therefor  a
little later.
34.         What is the effect of provisional possession which was given  to
the appellant’s husband in 1960  on approval of his highest  bid?   Does  it
amount to creation of an encumbrance in the property?   If  the  provisional
possession given to the appellant’s  husband  amounted  to  creation  of  an
encumbrance,  whether the said property could have been acquired  under  the
LA Act although the ownership vested in the central  government?   The  fate
of the appeal significantly will depend upon answer to these questions.  35.
      Concise Oxford English Dictionary  [Tenth  Edition,  Revised]  defines
“encumbrance” – 1.  a burden or impediment.  2.  Law  a  mortgage  or  other
charge on property or assets.
36.         Webster Comprehensive Dictionary [International Edition;  Volume
I] defines “encumbrance” as follows:
           “1. That which encumbers. 2. Law Any lien or liability  attached
           to real property.  3.  One’s  wife,  child  or  dependent.  Also
           spelled incumbrance. See synonyms under  IMPEDIMENT,  LOAD  [<OF
           encumbrance <encombrer. See ENCUMBER.]”

37.         In P. Ramanatha Aiyar’s The Law Lexicon [Second Edition  Reprint
2000] with reference to a decision  of  the  Patna  High  Court  in  Mahadeo
Prasad  Sahu  v.  Gajadhar  Prasad  Sahu[12],  the  term  “encumbrance”   is
explained as follows :
           “Encumbrance. Burden or property; impediment; mortgage or  other
           claim on property. Grant of lands rent free or the grant of  the
           landlords  zarait  land  to  a  tenant  for  the   purposes   of
           cultivation does amount to an encumbrance of the  estate.  Apart
           from mere dealings such as mortgages which create a charge  upon
           the  land,  there  are  other  dealings  which  amount   to   an
           encumbrance. Anything which  interferes  with  the  unrestricted
           rights of the proprietors as  they  then  existed  would  be  an
           encumbrance upon the land, even  the  granting  of  a  lease  of
           zarait lands, that is to say the lands  which  the  landlord  is
           entitled to hold in direct possession and to cultivate  for  his
           own purposes. A lease of such lands granted to  an  occupier  in
           circumstances which would give him a right of occupancy over the
           land, would amount to an encumbrance.”

38.         In Collector  of  Bombay  v.  Nusserwanji  Rattanji  Mistri  and
Others[13], the term “encumbrance” as occurring in Section 16 of the LA  Act
has been explained by this Court to mean interests in  respect  of  which  a
compensation  was  made  under  Section  11  or  could  have  been   claimed
thereunder.
39.         In M.  Ratanchand  Chordia  &  Ors.  v.  Kasim  Khaleeli[14],  a
Division Bench of the Madras High Court had  an  occasion  to  consider  the
meaning of the word “encumbrances” with reference to the 1954  Act  and  the
LA Act in the context of the easemantary right of way.  The  Division  Bench
considered the word “encumbrances” thus :
           “18. The word "Encumbrances" in regard to a person or an  estate
           denotes a burden which ordinarily consists of debts, obligations
           and responsibilities.  In  the  sphere  of  law  it  connotes  a
           liability attached to the property arising out  of  a  claim  or
           lien subsisting in favour of a person who is not  the  owner  of
           the property. Thus a mortgage, a charge and  vendor's  lien  are
           all instances of encumbrances. The essence of an encumbrance  is
           that it must bear upon the property directly and in-directly and
           not  remotely  or  circuitously.  It  is  a  right  in  realiena
           circumscribing and  subtracting  from  the  general  proprietary
           right of another person. An encumbered right, that  is  a  right
           subject  to  a  limitation,  is  called   servient   while   the
           encumbrance itself is designated as dominant.  . . . . . . .”

40.         The word “encumbrance”, according to its ordinary  significance,
means any right existing in another to use the land or whereby  the  use  by
the owner is restricted.   The  word  “encumbrance”  imports  within  itself
every right or interest in the land, which may subsist  in  a  person  other
than the owner; it is anything which places the burden of a legal  liability
upon property. The word “encumbrance” in law has to  be  understood  in  the
context of the provision under consideration but ordinarily  its  ambit  and
scope is wide. Seen thus, it is difficult to  see  why  a  binding  contract
entered into between an auction-purchaser and the government on approval  of
the highest bid relating to sale of property, which is part of  compensation
pool under Section 14 of the 1954 Act followed by provisional possession  to
the auction-purchaser, should not  come  within  the  purview  of  the  word
“encumbrance”.
41.         It is well known in law that  a  person  in  possession  of  the
property – though not owner – is entitled to certain  rights  by  virtue  of
his possession alone. We are in agreement with the view of the  Punjab  High
Court in Roshan  Lal  Goswami6  that  an  auction-purchaser  on  provisional
possession being given to him possesses possessory rights,  though  he  does
not have proprietary rights in the auctioned property. Thus,  there  remains
no doubt that in October, 1960 or near  about  encumbrance  in  the  subject
property came to be created.
42.         The next question is whether on creation of an encumbrance,  the
subject property could have been acquired under  the  LA  Act  although  the
ownership in the land vested in the  central  government.  Ordinarily,  when
the government possesses an interest  in  land,  which  is  the  subject  of
acquisition under the LA Act, that  interest  is  outside  such  acquisition
because there can be no question of the government  acquiring  what  is  its
own. This is what this Court said in Nusserwanji Rattanji Mistri13 but  this
rule is not without an exception. There is no impediment in  acquisition  of
land owned by the central government by invoking the provisions  of  the  LA
Act where such land is encumbered or where in respect of the land  owned  by
the government some private interest has been  created.    As  a  matter  of
fact, Sharda Devi11 does not hold to the contrary.  It is  so  because  what
Sharda Devi11  holds is  this  :   the   acquisition  of  land  wherein  the
ownership or the entirety of rights already vested in  the  State  on  which
there are no private rights or encumbrance such land is beyond  the  purview
of the LA Act. In other words, if the government has complete  ownership  or
the entirety of rights  in  the  property  with  it,  such  land  cannot  be
acquired by the government by invoking its power of  acquisition  under  the
LA Act but if some private rights have been created in such property or  the
property has encumbrance(s), the acquisition of such land is not beyond  the
pale of the LA Act.
43.         Madan Lal Nangia5 has been relied upon by the Division Bench  in
the impugned order in upsetting  the  decision  of  the  Single  Judge.  Mr.
Ranjit  Kumar,  learned  senior  counsel  for  the   appellant   sought   to
distinguish this judgment.   He submitted that Madan Lal Nangia5 was a  case
where this Court was concerned with  the  properties  which  vested  in  the
custodian and having regard to this aspect,  this  Court  said  that  merely
because the properties vest in the custodian as an evacuee property it  does
not mean that the same cannot be acquired for some other purpose.
44.         It  is  true  that  facts  in  Madan  Lal  Nangia5  were  little
different but, in our view, the legal position highlighted therein does  not
become inapplicable to the present case on that ground.  In  paragraphs  16,
17 and 18 of the Report (Pgs. 334-335), this Court observed as follows:
           “16.…………A property is a composite  property  because  a  private
           party  has  an  interest  in  that  property.  The   scheme   of
           separation, to  be  framed  under  Section  10  of  the  Evacuee
           Interest (Separation) Act, is for the purpose of separating  the
           interest  of  the  evacuee  from  that  of  the  private  party.
           Therefore, even if the evacuee's  interest  was  acquired  under
           Section 12, the interest of the private person could  have  been
           acquired under the Land Acquisition Act. Further,  if  the  land
           stood acquired by  the  notification  dated  7-7-1955  then  the
           question would arise as to how the respondents acquired title to
           these lands. If they purchased after the  date  of  notification
           dated 7-7-1955, they would get no title. They then would not  be
           able to maintain the writ petition. Dr Dhavan submitted that the
           appellants had admitted the title of the  respondents  and  thus
           this question would not arise.  We  are  unable  to  accept  the
           submission. It is only a person who has an interest in the  land
           who can challenge acquisition. When a challenge is  made  to  an
           acquisition at a belated  stage,  then  even  if  the  court  is
           inclined to allow  such  a  belated  challenge,  it  must  first
           satisfy itself that the person challenging acquisition has title
           to the land. Very significantly,  in  their  writ  petition  the
           respondents do not state when they acquired title.
           17.……Undoubtedly, the evacuee properties vested in the Custodian
           for the purposes of distribution as per the  provisions  of  the
           various Acts. However, it is to be noted that under the  various
           Acts in lieu of properties, compensation in terms of  money  can
           also be paid. Thus, merely because the properties  vest  in  the
           Custodian as evacuee properties does  not  mean  that  the  same
           cannot be acquired for some other public purpose……………
           18……..It would be open to  the  Government  to  acquire  evacuee
           property  and  give  to  the  Custodian  compensation  for  such
           acquisition. Section 4 notification dated 23-1-1965  not  having
           excluded evacuee properties the respondents can get  no  benefit
           from the fact that in the 1959 notification  evacuee  properties
           had been excluded.”


45.         From the judgment in Madan Lal Nangia5 , three  propositions  of
law emerge:
          (i)    At the time  of  acquisition  of  evacuee  property  under
          Section 12 of the 1954 Act if such property  has  interest  of  a private person, the interest of  private person can  be  acquired under the LA Act even though the land is owned by the government.
          (ii)   The properties that  vest  in  the  Custodian  as  evacuee properties can be acquired for some other public purpose.
          (iii)  When a challenge is laid to the acquisition of the land at a belated stage then if the court is inclined  to  allow  such  a
belated challenge, it must first satisfy itself that  the  person
challenging acquisition has title to the land.
46.         What follows from proposition (i) is also this  that  after  the
acquisition of evacuee property under Section  12,  if  any  encumbrance  is
created or interest of a private person intervenes therein, such land   even
if owned by the government can be acquired under the LA  Act.   This  is  in
congruity and consonance with Sharda Devi11 as well.
47.         When the facts of the instant case are  seen  in  light  of  the
above legal position, we are of the considered view  that
the  appeal  must fail. 
In the first place, as noticed above, by approval of the  highest  bid
given by the appellant’s husband followed with  provisional  possession,  an
encumbrance was created in 1960 in the subject land which was  part  of  the
compensation pool before the acquisition  proceedings  were  initiated  and,
therefore, it could have been acquired by  the  Delhi  Administration  under
the LA Act. 
Secondly, and  equally  important,  the  acquisition  which  was
commenced by Section 4 read with Section 17(1)(iv)  Notification  issued  on
07.03.1962 which ultimately culminated  into  an  award  on  30.06.1962  was
challenged for the first time after more than thirty years  of  the  passing
of the award. 
The appellant has failed to show her title  or  her  husband’s
title  in the property on the date of the acquisition. 
As a matter of  fact,
though the approval to the highest bid given by the appellant’s  husband  in
respect of the subject property was given  on  31.10.1960,  the  payment  of
full price by the appellant was made pursuant  to  the  communication  dated
16.06.1980 but by that time the subject land already stood acquired  by  the
Delhi Administration and, therefore, despite the payment of  full  price  by
the appellant in 1980 and the issuance of the  sale  certificate,  no  title
came to be vested in the  appellant.    
The  legal  position  that  we  have
summarised  with regard to transfer of title  in  respect  of  the  property
forming part of the compensation pool put to public auction  under  Rule  90
of the 1955 Rules in the earlier part of the  judgment  does  not  help  the
appellant at all because of completion of acquisition  proceedings  in  1962
much before the payment of full purchase price by  the  appellant.   In  the
absence of any title in favour of the appellant or her husband on  the  date
of acquisition, the challenge  to  such  acquisition  could  not  have  been
allowed by the Single Judge.  The  Division  Bench  rightly  set  aside  the
erroneous order of the Single Judge.
48.         In view of the above, appeal has no merit and is  liable  to  be
dismissed and is  dismissed with no order as to costs.
49.          It  is,  however,  clarified   that   appellant’s   claim   for
compensation, refund or any other monetary claim shall be considered  and/or
decided on its own merits in accordance with law and  the  present  judgment
shall have no bearing in relation to such claim.
                                                  …………………….J.
                                                        (R.M. Lodha)




                                                          .…………………….J.
                                                    (Anil R. Dave)
NEW DELHI
JANUARY 29, 2013.







-----------------------
[1]     AIR 1965 SC 1994
[2]     29 (1986) DLT 246
[3]     1997 Rajdhani Law Reporter 101
[4]     M.S. Dewan v. Union of India & Ors. [C.W.P. No. 1400/1986]; Decided
on 06.02.2003.
[5]     (2003) 10 SCC 321
[6]     AIR (1963) Punjab 532
[7]     AIR (1964) Punjab 99
[8]     AIR 1958 SC 289
[9]     (1994) 5 SCC 471
[10]    (2005) 4 SCC 572
[11]    (2003) 3 SCC 128
[12]   AIR 1924 Patna 362
[13]    AIR 1955 SC 298
[14]     AIR 1964 Madras 209

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