Courts may grant aid beyond claims in land cases, says SC

The ruling came in an appeal challenging a Karnataka HC verdict that had enhanced compensation for acquired land but restricted the final payable amount to a lower figure because that was the extent of the landowners’ claim

The Supreme Court has held that courts must not restrict compensation in land acquisition cases to the amount claimed by landowners if the law entitles them to a higher sum, underlining that it is the judiciary’s duty to assess and award just compensation based on statutory principles, not on the pleadings of claimants.

The Supreme Court said that once a court arrives at a finding on the correct market value of acquired land, it cannot reduce the compensation on the ground that the landowner did not specifically seek a higher amount. (ANI)

A bench of justices Prashant Kumar Mishra and Vipul M Pancholi said that once a court arrives at a finding on the correct market value of acquired land, it cannot reduce the compensation on the ground that the landowner did not specifically seek a higher amount.

“It is the duty of the Court to assess the compensation for which the landholder is entitled and not the claims made by the landholders,” held the bench in a recent judgment, stressing that equity and statutory obligation must guide adjudication in land acquisition matters.

The judgment reinforces the principle that land acquisition proceedings are not adversarial in the conventional sense and that courts are duty-bound to ensure landowners receive just and fair compensation in accordance with law. By rejecting a claim-based ceiling on compensation, the ruling further strengthens safeguards against undervaluation of land and underscores that the equitable role of courts in balancing state power of acquisition with the property rights of individuals.

The ruling came in an appeal challenging a Karnataka High Court judgment that had enhanced compensation for acquired land but restricted the final payable amount to a lower figure because that was the extent of the landowners’ claim.

The case arose from the acquisition of the petitioner’s land for the construction of the left bank canal of the Hirehalla Project in Karnataka. Initially, the land acquisition officer fixed the market value at ₹1.37 lakh per acre. This was enhanced by the reference court to ₹5.00 lakh per acre.

On appeal, the Karnataka High Court reassessed the evidence and concluded that the correct market value of the land was ₹16.94 lakh per acre. However, despite this finding, the High Court confined the actual compensation payable to ₹15.00 lakh per acre on the ground that the petitioners had claimed compensation only up to that amount.

The Supreme Court found this approach legally unsustainable. Referring to its earlier judgment in Gundabhat & Anr Vs Assistant Commissioner/Land Acquisition Officer (2023), the bench reiterated that once a court determines the market value in accordance with law, it commits a “serious error” if it restricts compensation solely on the basis of the prayer made by the landowners.

The court emphasised that under the Land Acquisition Act, the Collector is statutorily mandated to assess the compensation “which in his opinion should be allowed for the land” after considering the factors laid down in Section 23 of the Act. This statutory duty, the bench said, cannot be diluted by procedural technicalities or the extent of the claim raised by the landholder.

“When a statutory duty is cast on the Collector to assess the compensation which should be allowed for the land and the High Court in appeal has assessed such compensation at a particular rate, it was not open for the Court to have restricted the compensation at a lower rate on the ground that such higher rate of compensation is not claimed by the landholders,” the bench observed.

Setting aside the high court’s order, the Supreme Court directed that the petitioner was entitled to compensation at the rate of ₹16.94 lakh per acre, along with all consequential benefits admissible under the award.

The bench clarified that the petitioner would be required to pay the differential court fee on the enhanced amount of compensation, as directed by the High Court. It further directed the respondent authorities to pay the enhanced compensation within three months.