TaxTMI 
TaxTMI 
2017 (1) TMI 1828
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....as and Sy. No. 123/2 measuring 1 acre situated at Anganahalli Village, Belagola Hobli, Srirangapatna Taluk, Madhya District, Karnataka. 3. The Appellants issued a preliminary notification Under Section 28(1) of the Karnataka Industrial Areas Development Act, 1966 (hereinafter referred to as "KIAD Act") as it wanted to acquire certain lands, including that of the Respondents for the purpose of developing the said lands as an Industrial Area and the same was published in the Karnataka Gazette on 15th September, 2000. 4. After issuing the necessary notices and following the procedure prescribed under the KIAD Act, a final notification Under Section 28(4) was issued on 15th June, 2005 in respect of total 153 acres 10 guntas of land. 5. Section 29 of the KIAD Act deals with compensation. Section 29(2) provides that where the compensation has been determined by agreement between the State Government and the person to be compensated, it shall be paid in accordance with such an agreement. In case, where no agreement is arrived at, the State Government is to refer the case to the Deputy Commissioner for determination of the amount of compensation to be paid. This scheme of acquisit....
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....by the State Government under this Chapter, the State Government shall pay for such acquisition compensation in accordance with the provisions of this Act. (2) Where the amount of compensation has been determined by agreement between the State Government and the person to be compensated, it shall be paid in accordance with such agreement. (3) Where no such agreement can be reached, the State Government shall refer the case to the Deputy Commissioner for determination of the amount of compensation to be paid for such acquisition as also the person or persons to whom such compensation shall be paid. (4) On receipt of a reference under Sub-section (3), the Deputy Commissioner shall serve notice on the owner or occupier of such land and on all persons known or believed to be interested herein to appear before him and state their respective interests in the said land. 6. Section 30 of the KIAD Act deals with application of Land Acquisition Act, 1894 (hereinafter referred to as the 'Old LA Act') and same is reproduced below: Section 30. application of Central Act 1 of 1894.--The provisions of the Land Acquisition Act, 1894 (Central Act 1 of ....
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....s deposited before the Civil Court vide cheque dated 8th March, 2007. On that basis LAC No. 13 of 2007 was registered and the court sent notice dated 13th June, 2008 to the Respondents. At this stage, the writ petition was filed by the Respondents in the High Court of Karnataka praying for quashing of preliminary notification dated 15th September, 2000 and final notification dated 15th February, 2005, inter alia, on the following grounds: (a) That provisions of Section 11, 11A of the Old LA Act are made applicable to the proceedings under KAID Act by virtue of Section 30 of the KAID Act and the Deputy Commissioner has not passed any award as required Under Section 11 of the Old LA Act; (b) The entire proceedings initiated Under Section 28 of the KAID Act have lapsed as no award has been passed within two years from the date of publication of final declaration. (c) In the absence of consent award Under Section 29(2) of the KIAD Act, the Deputy Commissioner is duty bound to pass regular award Under Section 11A of the Old LA Act within two years from the date of publication of final notification. (d) That the Respondent herein had not given any cons....
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.... quashed the proceeding initiated by the Appellants by way of preliminary and final notification on the following grounds: (a) When the award was required to be passed under the Old LA Act, it cannot be said that provisions of the New LA Act would not apply to acquisition under KIAD Act and, therefore, Section 24 of the New LA Act will apply. (b) Even though this Court has held that Section 11A of the Old LA Act has no application in respect of the land acquired under the provisions of KIAD Act, the New LA Act is applicable and that the acquisition proceedings would be deemed to have lapsed due to non-payment, compensation and non-passing of the award within a period of two years. (c) That the New LA Act does not say whether it is applicable to the lands acquired under the provisions of Karnataka Land Acquisition Act but what Section 24 says is that once the award is not passed Under Section 11A of Old LA Act or the compensation is not paid within five years, such proceeding would be lapse. 13. It could be gathered from the above that the Division Bench has held that the New LA Act would be applicable to the present proceedings though they were initiat....
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....tion at Rs. 6,50,000/- and, therefore, the decision of the Advisory Committee dated 9th September, 2005 in this behalf was not binding on the Respondents. On this basis, it was submitted that as the exercise contemplated Under Section 29 of the KIAD Act was not fructified, it was like 'No Consent Award' passed by the Advisory Committee and provisions of Sub-section (2) of Section 24 of New LA Act shall squarely apply. 16. From the narration of events described above as well as the arguments of both the sides, it becomes clear that the first question which needs determination is as to whether fixation of compensation at the rate of Rs. 6,50,000/- per acre by the Advisory Committee is with the consent of the Respondents or not. 17. Before adverting to the aforesaid aspect, we may clarify certain legal aspects. In the State of Karnataka, land can be acquired under the KIAD Act as well, for the purpose of developing the acquired land as an industrial area. Section 28(1) of the KIAD Act provides for issuance of preliminary notification for the aforesaid purpose. Other Sub-sections of Section 28 provide for a particular procedure to be followed by issuing necessary notices ....
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....a preliminary notification Under Section 28(1) of the KIAD Act was published. It was followed by final notification dated 15th June, 2005 Under Section 28(4) of the KIAD Act. With the issuance of notification Under Section 28(4) of the KIAD Act, the land stood vested absolutely in the State Government, free from all encumbrances (See Section 28(5) of the KIAD Act). Next step was to take the possession of the land as per the procedure stated in Sub-sections (6) and (7) of Section 28 of the KIAD Act and to pay the compensation as provided Under Section 29 of the KIAD Act. The State Government had constituted the Advisory Committee consisting of 8 persons which deliberated with the land owners in order to arrive at consensual figure of the compensation. Notice dated 23rd August, 2005 was issued in this behalf fixing the date of meeting as 9th September, 2005 with request to the land owners to attend the said meeting. Appellants have placed on record proceedings of the said meeting held on 9th September, 2005 as per which consent agreement was arrived at whereby compensation was fixed at Rs. 6,50,000/- per acre. It appears that thereafter letter dated 16th August, 2006 was sent by the ....
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.... no need to pass the award. It was also stated that insofar as Appellants are concerned, it had deposited the amount of compensation in the Civil Court in view of the dispute between the Respondents inter se. 21. From the issuance of notice alone to the Respondents Under Section 29 of KIAD Act, it cannot be said that Respondents had agreed to the compensation. It may be noted that large chunk of land was acquired and there were other land owners as well, despite the Respondents. No doubt, proceedings dated 9th September, 2005 indicate that consent agreement is arrived at fixing the compensation at Rs. 6,50,000/- per acre. However, the moot question is as to whether Respondents are also consenting parties. The learned Single Judge of the High Court returned a categorical finding that Respondents never gave any such consent. For this purpose, reference was made to Rule 10(b) of the Karnataka Land Acquisition Rules, 1965 which states the format in which the said mutual agreement is to be arrived at i.e. Form D. Rule 10(b) states the form of agreement to be executed under Sub-section (2) of Section 11 shall be in Form D. No such document is produced by the Appellants. Moreover, the ....
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....th the fixation of compensation as per the Minutes dated 9th September, 2005 all the land owners, including the Respondents, had agreed with the same and, therefore, no further exercise was required. Had the Appellants-authorities been more careful, they would have noticed that insofar as Respondents herein are concerned, they are not the consenting parties. In that event, they could have brought them on board with other land owners by taking their specific consent as well or proceeded further Under Section 29(3) of the KIAD Act. 23. Taking these factors into consideration, the learned Single Judge vide his judgment dated 9th November, 2012 permitted the Appellants to proceed on the basis of the Gazette notification dated 15th June, 2005 acquiring the land and determine the compensation by making an award in this behalf. By this process, Appellants were allowed to proceed afresh to determine the compensation Under Section 29(2) of the KIAD Act by reaching an agreement with the Respondents, and failing which to refer the case to the Deputy Commissioner Under Section 29(2) for determination of the amount of compensation. The learned Single Judge, by adopting this course of action,....
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....uired to be passed under the provisions of LA Act. When the award is required to be passed under LA Act, the Respondents cannot contend that the provisions of New Act cannot be made applicable on account of non-payment of compensation within a period of five years. 25. This approach of the High Court, we find, to be totally erroneous. In the first instance, matter is not properly appreciated by ignoring the important aspects mentioned in para 24 above. Secondly, effect of non-applicability of Section 11A of the Old LA Act is not rightly understood. The High Court was not oblivious of the judgment of this Court in M. Nagabhushana's case which is referred by it in the aforesaid discussion itself. This judgment categorically holds that once the proceedings are initiated under the KIAD Act, Section 11A of the Old LA Act would not be applicable. Such an opinion of the Court is based on the following rationale: 29. The Appellant has not challenged the validity of the aforesaid provisions. Therefore, on a combined reading of the provisions of Sections 28(4) and 28(5) of the KIAD Act, it is clear that on the publication of the Notification Under Section 28(4) of the KIAD Ac....
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....e 533], held that Section 11-A of the said Act does not apply to acquisition under the BDA Act. 33. The same principle is attracted to the present case also. Here also on a comparison between the provisions of the said Act and the KIAD Act, we find that those two Acts were enacted to achieve substantially different purposes. Insofar as the KIAD Act is concerned, from its Statement of Objects and Reasons, it is clear that the same was enacted to achieve the following purposes: It is considered necessary to make provision for the orderly establishment and development of industries in suitable areas in the State. To achieve this object, it is proposed to specify suitable areas for industrial development and establish a board to develop such areas and make available lands therein for establishment of industries. 34. The KIAD Act is of course a self-contained code. The said Act is primarily a law regulating acquisition of land for public purpose and for payment of compensation. Acquisition of land under the said Act is not concerned solely with the purpose of planned development of any city. It has to cater to different situations which come within the expande....