In WRIT PETITION NO. 2231 OF 2019-BOM HC- Mere grant of approval or passing of resolution by authorities for grant of TDR/FSI in lieu of monetary compensation is not step for acquisition of land, unless it concludes contract between parties: Bombay HC Justices S.B.Shukre, Anuja Prabhudessai & Anil Laxman Pansare [25-07-2022]

 Read Order: SHREE VINAYAK BUILDERS & DEVELOPERS V. THE STATE OF MAHARASHTRA AND ORS 

Mansimran Kaur

Nagpur, July 27, 2022:The Nagpur Bench of the Bombay High Court has recently opined that right to property still remains a constitutional right under Article 300 A of the Constitution of India, which ensures that the right to property is not abridged by the State except in accordance with law and recognizes the right of the land owner to seek just and fair compensation. 

 In a petition relating to declaration of lapsing of reservation by operation of Section 127 of MRTP Act, 1966, the Larger Bench of Justice S.B.Shukre, Justice Anuja Prabhudessai and Justice Anil Laxman Pansare observed that the two modes of acquisition under Section 126(1) are by agreement by paying an amount agreed to and secondly by, grant of TDR/FSI in lieu of compensation, depending  on the agreement between the parties where consent of the land owner is equally important, rather is a pre-condition.

The Division Bench disagreed with the view expressed in Asha Sunil Zawar vs.  State of Maharashtra & Ors that the option regarding the manner in which reserved land should be acquired, can be exercised only at the discretion of the Acquiring Authority, and not at the discretion of the land owner.  In view of the same, the matter was referred to this larger bench.

The bench observed that the acquisition under Section 126(1)(a) and (b) of the Maharashtra Regional & Town Planning Act, 1966 has to be by consensus between both the parties and not only at the option of the Acquiring Authority. After considering the submissions from both sides at length, the larger bench of this Court deemed it apposite to consider Sections 125, 126 and 127 of the MRTP Act.

In view of the same, the Court noted that the mode of acquisition of land under Section 126(1) (a) and (b) of the MRTP Act was by an agreement.  The word agreement connotes offer and acceptance and signifies that the agreement is not an unilateral act but a bilateral act which is concluded with communication of acceptance of the offer. Thus, Acquisition of land reserved for public purpose under Section 126(1) (a) and (b) cannot be by any unilateral proposal of the Acquiring Authority to acquire the land with an offer of compensation or FSI/TDR, the Court noted. 

It was further observed that it is a mutual agreement between the Acquiring Authority and the land owner whereunder the land is acquired by the concerned authority by agreement either by paying an amount agreed to or by granting, in lieu of any agreed amount, FSI or TDR against the area of land surrendered free of cost, and free of all encumbrances. That being so, the modes of acquisition of land under Section 126(1)(a) and (b) of the MRTP Act, can be resorted to only when there is a consensus between the parties.

In the absence of such concord, the only option available to the Acquiring Authority is to take recourse to Section 126(1) (c) of the Act and make an application to the State Government under the provisions 2013 Act, the Court noted.  Additionally, the Court stated that it is well settled that the language employed in the statute is a determinative factor of the legislative intent. The Court cannot change the scope of legislation or intention, when the language is plain and unambiguous.  Reliance was placed on the judgment in Bhavnagar University vs. Palitana Sugar Mill (P) Ltd. & others.

Clauses (a) and (b) of Sub-Section (1) of Section 126 envisage agreement between the land owner / lessee and the acquiring authority. The intention of the legislature, as it comes out from the plain reading of these provisions is that wherever possible, land acquisition by agreement, either by payment of agreed amount or in lieu of such amount by grant of FSI/TDR, should be encouraged as these modes of acquisition are faster, more effective, and more economic in the long run, the Court remarked. 

Additionally, the Court observed that acquisition under Section 126(1) (a) or 126(1)(b) being acquisition by agreement, there is no statutory remedy to challenge determination of compensation awarded in the form of money or the extent of TDR/FSI as per DCR. Under the circumstances, compelling the land owner to accept the compensation or FSI/TDR as determined/ calculated by the Acquiring Authority, without questioning and bargaining will be unfair and lead to unjust and inequitable results.

Further reliance was also placed on the case of Girnar Traders vs. State of Maharashtra and others, wherein the Apex Court after considering the entire scheme of Sections 126 and 127 observed that the step taken under the section within the time stipulated should be towards acquisition of land. The same principle was reiterated in Shrirampur vs. Satyabhamabai Bhimaji Dawkher , Poona Timber Merchants and Saw Mill Owners Association vs. State of Maharashtra & Ors and Kolhapur Municipal Corporation & Ors. vs. Vasant Mahadev Patil (dead) through Legal Representatives and others .

Thus, the Court concluded by observing that the acquisition under Section 126(1)(a) and (b) of the Maharashtra Regional & Town Planning Act, 1966 has to be by consensus between both the parties and not only at the option of the Acquiring Authority. Mere approval of the request of the land owner to grant monetary compensation or grant of TDR/FSI in lieu of compensation by itself will not always result in a concluded contract and the question would have to be determined in the facts and circumstances of each case. 

 Lastly, it was observed that mere grant of approval or passing of resolution by the authorities concerned for grant of TDR/FSI in lieu of monetary compensation is not a step for acquisition of land, thereby commencing the proceedings for the acquisition of land, unless it concludes the contract between the parties. In light of these observations, directions were issued to the Registry to place the matter before the Original Bench.