Land-surrender agreements preserving further compensation rights can support a deemed award and statutory reference for re-determination.

The Kerala HC considered whether land-surrender agreements executed with the District Collector could operate as a deemed award under the land acquisition statute, enabling a reference for re-determination of compensation. Reading the agreements with the compensation scheme under the 2013 Act, the court treated the express preservation of further statutory compensation rights as binding on the acquiring authority, which had taken possession and paid consideration. It also held that the absence of income-tax deduction could not defeat the statutory compensation regime, because the Act exempts awards and agreements from tax subject to limited exceptions. The appeal failed, and the reference applications were to be processed under the Act.

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Issues: (i) Whether the land-surrender agreements executed between the landowners and the District Collector could be treated as a deemed award under the land acquisition statute so as to enable a reference for redetermination of compensation under Section 64. (ii) Whether the State could resist the landowners' claim by relying on the absence of income-tax deduction on the transaction.

Issue (i): Whether the land-surrender agreements executed between the landowners and the District Collector could be treated as a deemed award under the land acquisition statute so as to enable a reference for redetermination of compensation under Section 64.

Analysis: The compensation arrangement was not viewed as a bare private sale dehors the statute. The terms of the agreements were read along with the scheme of Sections 26 to 30 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, which govern market value, compensation, solatium and additional amounts. The agreements expressly contemplated re-determination under the Act and preserved the landowners' entitlement to any further compensation or package. Having acted upon the agreements, paid consideration and taken possession, the acquiring authority could not repudiate the very term that preserved the right to seek further statutory compensation. Since Section 64 permits a person interested who has not accepted the award to seek a reference, the Collector was bound to consider and forward the applications for determination by the competent authority.

Conclusion: The agreements could be treated as the basis for a deemed award and the landowners were entitled to seek a reference under Section 64.

Issue (ii): Whether the State could resist the landowners' claim by relying on the absence of income-tax deduction on the transaction.

Analysis: Section 96 of the Act expressly exempts awards and agreements made under the Act from income tax, stamp duty and fees, except to the limited extent stated in the provision. The absence of tax deduction at source could therefore not be used to deny the landowners the benefit of the statutory compensation regime or to contradict the effect of the agreements already acted upon.

Conclusion: The State could not defeat the claim by relying on non-deduction of income tax.

Final Conclusion: The appeal failed, and the direction to consider the reference applications under the statutory scheme was upheld.

Ratio Decidendi: Where land is surrendered and the acquisition transaction is carried out on agreed terms that preserve a right to re-determination, the acquiring authority remains bound by that stipulation and must process a reference under the statutory compensation framework; fiscal exemption provisions cannot be invoked to defeat that right.

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