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PETITIONER: STATE OF GUJARAT ETC.ETC.

       Vs.

RESPONDENT: DAYA SHAMJI BHAI ETC.ETC.

DATE OF JUDGMENT25/08/1995

BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. HANSARIA B.L. (J)

CITATION:  1996 AIR  133            1995 SCC  (5) 746  JT 1995 (6)   475        1995 SCALE  (5)248

ACT:

HEADNOTE:

JUDGMENT:                          O R D E R      Delay condoned. Leave granted.      Though notice  has been  served on all the respondents, none appears  either in person or through counsel in all the appeals.      Notification under Section 4(1) of the Land Acquisition Act, 1894  (for short,  ‘the Act’) was published on December 18, 1980  acquiring large extent of lands for the purpose of irrigation dam No.2 Project. The land owners had given their consent in  writing on March 11, 1983 agreeing to accept the compensation determined  by the Land Acquisition Officer and 25 per  cent more  thereof and  also agreed  not to seek any reference under  Section 18. The market value was determined by the  Collector on  March 25,  1983, and  25 per  cent  in addition thereto was awarded. Respondents were paid in terms of the  consent agreements  signed by  the  respondents  and sanctioned   by   the   Superintending   Engineer,   Rajkot. Subsequent thereto,  the respondents  sought  for  reference under Section  18 on  April 26,  1986. The  Assistant Judge, Rajkot by  his award and decree dated June 29, 1991 enhanced compensation to  the rate  of Rs.200/-  per are  for Bagayat land  and   Rs.140/-  per  are  for  Jirayat  land.  Feeling aggrieved, when  the appellants  filed appeals,  the Gujarat High confirmed  the same by the impugned judgment and decree dated July 3, 1992. Thus these appeals by special leave.      The only  question is whether the claimants of the land are entitled  to seek  reference under  Section 18  and  the civil court  can determine  higher compensation.  Section 11 (2) of  the Act  empowers  the  parties  to  enter  into  an agreement and  an award  in terms thereof is permissible. In the agreement  they had  specifically accepted  that  owners would  receive   compensation  and   25  per   cent  of  the compensation in addition and had agreed to forgo their right to seek  reference under  Section 18  of the Act. The owners and the  Special Land  Acquisition Officer  had agreed under

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Section 11(2)  of the  Act that the Land Acquisition Officer would make  the award in terms of the contract. Clause 14 of the agreement reads thus:      "The land  owners will  not  go  to  any      Court under Section 18 of the Act."      In the  award, it  is seen  that the  Land  Acquisition Officer while awarding the compensation, had also worked out the addition  of 25%  and awarded  total compensation to the land owners.  It is  not in  dispute that they had been paid accordingly. In  the award, the Land Acquisition Officer has specifically stated that :      "As  discussed   in  para   9-A  and  as      mentioned in  para 9-B,  I fix the value      of the  lands, under acquisition in this      case, for  Bagayat Lands at Rs.110/- per      are, for  Jirayat Lands  at Rs.80/-  and      for waste  lands at  Rs.10/- per are and      further order  to pay as such. Moreover,      in this case, the persons interested has      demanded  for   25%  consent  more.  The      consent  rate   is  sanctioned   by  the      Superintending     Engineer,      Rajkot      Irrigation  Circle,   Rajkot  vide   his      letter  No.PB/4/General/LAO/1519,  dated      25.3.1983 and  accordingly I  also order      to pay  the  amount  of  25%  consequent      rate."      In view  of the  above agreement  and in  view  of  the discussion made by the Land Acquisition Officer in the award and working  details given in the annexures made therein, it is clear  that the  parties  having  contracted  to  receive compensation the  question emerges whether they are entitled to seek a reference. On making an award under Section 11 and issuance of  the notice  under Section  12 of  the Act,  the Collector is enjoined under Section 31 (1) to tender payment of the compensation awarded by him to the interested persons entitled thereto  to receive  the compensation  according to the terms  of the  award. Under  the second  proviso to sub- section (2)  of Section  31 "no  person who has received the amount otherwise  than under  protest shall  be entitled  to make any  application under  Section 18". The entitlement to make reference  to civil  court under  Section  18  (1)  and within  the  period  prescribed  under  sub-section  (2)  is conditioned upon  non-acceptance of  the award.  Sub-section (1) of  Section 18  makes the matter clear thus: "Any person interested who  has not  accepted the  award may, by written application to  the Collector,  require that  the matter  be referred by the Collector for the determination of the Court regarding his  objection, be  it to  the measurement  of the land, the amount of the compensation, the persons to whom it is payable,  or the  apportionment of the compensation among the persons  interested." The  right and entitlement to seek reference  would,   therefore,  arise  when  the  amount  of compensation was  received under  protest in  writing  which would manifest  the intention of the owner of non-acceptance of the  award. Section  11 (2)  opens with  an  non-obstante clause "notwithstanding  anything contained  in  sub-section (1)" and  provides that "if at any stage of the proceedings, the Collector  is satisfied  that all the persons interested in the  land who  appeared before him have agreed in writing on the  matters to be included in the award of the Collector in the  form prescribed  by rules  made by  the  appropriate Government, he  may, without making further enquiry, make an award according to the terms of such agreement. By virtue of sub-section (4),  "notwithstanding anything contained in the

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Registration Act,  1908, no agreement made under sub-section (2) shall  be liable  to registration  under that  Act". The award made  under Section  11 (2)  in terms of the agreement is, therefore, an award with consent obviating the necessity of reference under Section 18.      The Reference  Court negatived  the contention  of  the State and  its reliance  on agreement  of the parties on the ground that  since the  said agreements  were not registered under  Registration  Act,  they  cannot  contract  out  from statute. Therefore  the Reference  Court has  the  power  to award higher  compensation. It  is seen that in the contract they had agreed to receive compensation and 25 per cent more in addition  thereto. They  had also  agreed not to seek any reference under  Section 18.  In the  light of the above, no option is  left to  the parties  under Section  18  to  seek reference. Sub-section  (2) of Section 11 gives right to the parties  to   enter  into  an  agreement  to  receive  award compensation awarded  under  Section  11  in  terms  of  the contract. In  fact, it would be more expeditious to have the dispute sorted  out so as to avoid delay in determination of proper compensation. The contract between the owners and the Collector in  writing of  the terms  to be  included in  the award of  the Collector is conclusive and binds the parties. They would  not  be  entitled  to  seek  any  reference  for enhancement of  the compensation  required to be adjudicated under Section  23(1) of  the Act. It would be seen that when compensation was  received under  protest, Section  18  gets attracted.      The  question   of  awarding   interest  and  statutory benefits arises  when the  civil court finds that the amount of compensation  awarded to the land owners by the Collector is not  adequate and  the prevailing  market value is higher than the  market value  determined by  the Land  Acquisition Officer under  Section 23(1).  For entitlement  to  solatium under Section 23(2), "in addition to" market value the court shall award  solatium. Under  Section 28,  if the court gets power  to   award  interest,  when  court  opines  that  the Collector "ought  to have  awarded compensation in excess of the sum  which the collector did award the compensation". In other  words,  valid  reference  under  Section  18  confers jurisdiction on  the civil  court to  consider  whether  the compensation awarded  by the  Collector is  just  and  fair. Thereafter, when  it finds  that the Collector ought to have awarded  higher   compensation,   the   civil   court   gets jurisdiction  to   award  statutory   benefits   on   higher compensation from  the date  of taking  possession only.  In view of  the specific  contract made  by the  respondents in terms of  Section 11(2),  they are  not entitled  to seek  a reference.  Consequently,  the  civil  court  is  devoid  of jurisdiction to go into the adequacy of compensation awarded by the  Collector or  prevailing market value as on the date of  notification   under  Section   4(1)  to  determine  the compensation under  Section 23(1)  and  to  grant  statutory benefits.      By  operation   of  Section   11(4),   the   need   for registration of  the agreement  is obviated.  As seen in the contract,  the  respondents  have  forgone  their  right  of seeking reference  in lieu of 25% more than the compensation determined by  the Collector under Section 11(2) of the Act. In fact,  25 per  cent  in  addition  to  the  market  value determined by the Collector in his award under Section 11(1) had been  paid as the consideration to forgo reference. Even otherwise, once an agreement was entered by the parties, the question of  objection to receive compensation under protest does not  arise. So,  they have no right to seek a reference

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to the civil court under Section 18 of the Act.      The appeals  are accordingly allowed. The orders of the reference court as confirmed by the High Court are set aside but, in the circumstances, without costs.