On Tuesday, 15 October, a Constitution Bench of the Supreme Court will begin hearing five cases related to the interpretation of the law on land acquisition in India.
The Bench will comprise Justices Arun Mishra, Indira Banerjee, Vineet Saran, MR Shah and S Ravindra Bhat, as per a notice issued by the Supreme Court registry on Sunday.
Why is this newsworthy?
Well, this special Constitution Bench, headed by Justice Arun Mishra, in order to decide the five cases, will have to decide whether Justice Mishra got the issue right, back in a February 2018 judgment.
What is the Legal Issue at Play Here?
In 2013, the Parliament passed a new law on land acquisition – the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act (here: 2013 Act), which replaced the old Land Acquisition Act, 1894 (here: 1894 Act) and was supposed to redress grievances of the fairness of compensation provided to those whose land was acquired, mostly farmers.
Section 24 of the 2013 Act was important to deal with cases where acquisition proceedings had begun under the 1894 Act but hadn’t been concluded by the time the 2013 Act came into force.
According to Section 24(2), if:
- acquisition proceedings had begun under the 1894 Act; and
- an award of compensation was passed five or more years before the 2013 Act came into force (ie 2008 or earlier); but
- the physical possession of the land hadn’t been taken; or
- the compensation hadn’t been paid
then the acquisition proceedings would be deemed ‘lapsed’ and fresh proceedings would need to be instituted under the 2013 Act, which, in all likelihood, would mean greater compensation for the landowner.
However, what would happen if a landowner refuses to accept the compensation amount, even when the acquirer (such as a mining company or a company setting up a factory) offers to pay the money and has provided the money to the relevant government authority?
What if it is unclear who exactly owns the land, or who would receive how much share of said land?
Would Section 24(2) still apply or would it be unfair to the acquirer?
The Pune Municipal Corporation Case – 24 January 2014
That’s something the Supreme Court had to consider almost immediately after the 2013 Act became effective on 1 January 2014 in the Pune Municipal Corporation case, where a three-judge Bench of the apex court, headed by Justice RM Lodha, unpacked the meaning of the term “compensation has not been paid” in Section 24(2).
As compensation under the 1894 Act was dealt with, they looked to see what the old law had to say about the payment of compensation. Under Section 31 of the 1894 Act, the Collector from the local administration, who would get payment from the acquiring entity was responsible for paying the compensation to the relevant landowner.
Section 31(2) specifically addressed the exigencies where payment was not possible for no fault of the acquirer or the Collector. If the landowner refused to accept the compensation or a dispute over the apportionment of the compensation erupted, the Collector would pay the amount to the court where a challenge against the award of compensation (known as ‘reference’) “would be submitted”.
Based on this, the Supreme Court held that for the purposes of Section 24(2) of the 2013 Act, compensation would be considered ‘paid’ if the amount had been deposited to the relevant court.
If the money had been paid to the government treasury, but not to the court, it would not count – which meant if the other conditions of Section 24(2) were fulfilled, the whole land acquisition process had to start again.
The Indore Development Authority Case – 8 February 2018
The interpretation of Section 24(2) and what constituted payment of compensation as per Pune Municipal Corporation was settled law for over four years, as had been expressly held in Delhi Development Authority vs Sukhbir Singh.
Hundreds of cases over the issue had been filed in the high courts and in the Supreme Court in the years following the 2013 Act’s passage.
The cases weren’t filed by people trying to scam the system and refusing to accept compensation for five years with the objective of cutting a better deal. The Parliament had expressly prevented the same by saying award of compensation had to have been made five years or more before the 2013 Act became effective.
Of the cases, around 60 ended up before Justices Arun Mishra, AK Goel and MM Shantanagoudar. On 8 February 2018, they delivered a judgment in the Indore Development Authority case which dramatically overturned all those years of precedent and introduced a vastly different interpretation of Section 24(2).
According to them, paying money into the government treasury sufficed. Consequently, even if the money hadn’t been paid to the court or the landowner’s account, the proceedings under the old act wouldn’t be deemed lapsed.
This was arrived at by interpreting the words ‘paid’ and ‘deposited’ differently and by looking at Rules passed in a few states under Section 55 of the old Act, which said if a person didn’t accept the compensation and didn’t file a reference against it, then the money needed to be paid into the treasury and not the court.
What’s more – in a 2:1 majority, Justices Mishra and Goel went on to say the judgment passed in 2014, in Pune Municipal Corporation case, was ‘per incuriam’ – ie it had been decided incorrectly by ignoring points of law that should have been considered. Decisions held to be per incuriam are considered to have never taken place.
Why Is the Issue Being Looked at by a Constitution Bench?
A few days after Justice Mishra’s judgment, another case related to Section 24(2) was brought up in Justice Madan Lokur’s court. Justice Lokur had been one of the three judges who delivered the Pune Municipal Corporation judgment in 2014, and was thus set to decide the new case along similar lines.
Much to his surprise, he was informed by the lawyers in the court that his 2014 judgment wasn’t the law any longer as Justice Mishra’s court had declared it per incuriam. Justice Lokur immediately issued an order requesting high courts and the Supreme Court to hold deciding any cases on the issue till the conflict between the 2014 and 2018 decisions was resolved.
Justice Arun Mishra, hearing yet another case about the issue on 22 February 2018, then referred the matter to the Chief Justice of India (CJI Dipak Misra, at the time) so he could, in turn, set up a larger Bench to decide the correct interpretation of Section 24(2).
A year and a half later, with case after case on the line, the current CJI Ranjan Gogoi finally set up a Constitution Bench to resolve the mess.
Is it Proper for Justice Arun Mishra to Hear the Cases?
The Constitution Bench which will sit on 15 October has to consider which interpretation of Section 24(2) stands correct: Justices Lodha’s or Justice Mishra’s.
This isn’t a review of an existing judgment, which is traditionally carried out by the same judges. It isn’t a regular reference to a Constitution Bench as well. Generally, when judges see a substantial issue of law that they’re not sure how to interpret, they refer the issue to a larger Bench to decide the correct interpretation. In such references, it isn’t uncommon for one of the judges who referred the matter to be part of the larger Bench.
However, here, Justice Mishra thought the 2014 decision to be wrong and subsequently decided a set of cases. The reference to the CJI for consideration by a larger Bench came afterwards, in a separate case.
Therefore, concerns of impropriety have been raised by many members of the legal community. If Justice Mishra hadn’t passed his judgment in the Indore Development Authority case on 8 February 2018 and had referred the question of law to the CJI, no feathers would have been ruffled.
But since the Constitution Bench will now have to consider if Justice Mishra got it right in the 2018 judgment, him being one of the five judges to do so seems quite strange. Especially since neither of the judges who wrote the 2014 judgment can be part of the Bench – Justice Lodha retired in 2014, and Justices Lokur and Kurian Joseph in 2018.
Even Justice Shantanagoudar, who held a partially different view from Justice Mishra in the Indore Development Authority judgment and is still a sitting judge, is not being given a chance to express his views.
Alok Prasanna Kumar, senior resident fellow at the Vidhi Centre for Legal Policy told The Quint that,
The purpose of a five judge Bench to decide conflicting opinions of three-judge benches is not to simply take a poll to involve more judges in the deliberative process to ensure a better outcome. Therefore, when a judge who has already expressed an opinion in the matter is on the Bench (in this case Arun Mishra) but the other judges who have expressed an opinion are not (in this case Mohan Shantanagoudar), it would be improper and unfair as the deliberations among judges would be vitiated by one of their colleagues already having made up his mind.
Yes, judges are supposed to be fair and impartial. However, it’s only natural to expect a judge to favour his own interpretation in this circumstance. Justice Mishra went as far as to declare the 2014 decision per incuriam – he didn’t simply disagree with the old position, he wanted it to have never been so.
This was controversial in itself, as convention (for instance, see the Supreme Court’s decision in the Dawoodi Bohra case) says if a three judge Bench disagrees with an earlier decision of another three judge Bench, they should not just overrule the old decision but immediately refer the matter for consideration by a larger Bench. Justice Mishra failed to do so in his 2018 judgment even though Justice Shantanagoudar disagreed with holding the old decision per incuriam.
Indian and English case law defines an objective standard to assess whether there is a reasonable apprehension of bias when it comes to a judge hearing a particular case. It’s not what the judge thinks or even what a party to the case thinks, but, as Justice Kurian Joseph explained in his opinion in the NJAC case in 2015,
“Ultimately, the question is whether a fair-minded and reasonably informed person, on correct facts, would reasonably entertain a doubt on the impartiality of the Judge.”
Given the case’s circumstances, it’s hard to say the standard hasn’t been fulfilled, as lawyer and constitutional law scholar Gautam Bhatia writes in a blog post: “What would a detached and objective observer conclude upon seeing this? They would conclude that in this five-judge bench, at least one vote – the vote of the senior-most judge – is more or less decided (and it is unsurprising that the All India Farmer Association has already to the Chief Justice making exactly this point).”
As a tweet thread by journalist Kumar Shambhav Shrivastava shows, there appears to be a lot riding on this question of interpretation, involving some of the country’s biggest corporations, making it more important for the court to ensure there isn’t even the slightest whiff of impropriety over how it is to be decided – Caesar’s wife and all that.
Will this mean Justice Arun Mishra recusing himself from the case when it comes up for hearing? Will any of the parties involved in the case ask for the same?
All eyes will be on the court proceedings to find out.