Summary
| Category | Data |
|---|---|
| Court | Supreme Court of India |
| Case Number | C.A. No.-013839-013852 – 2025 |
| Diary Number | 22144/2020 |
| Judge Name | HON’BLE MR. JUSTICE M.M. SUNDRESH |
| Bench | HON’BLE MR. JUSTICE M.M. SUNDRESH; HON’BLE MR. JUSTICE SATISH CHANDRA SHARMA |
| Precedent Value | Binding authority on finality of statutory consent awards |
| Overrules / Affirms | Overrules Madras High Court’s application of Section 12 post-agreement; affirms sanctity of consent awards under Section 7(2)/(4) |
| Type of Law | Land acquisition statute |
| Questions of Law |
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| Ratio Decidendi | Once parties voluntarily agree compensation under Section 7(2) or 7(4) of the 1997 Act, that agreement constitutes a concluded contract; it “becomes sacrosanct,” excludes further recourse to the Act’s award machinery, and cannot be reopened via writ jurisdiction to claim interest under Section 12. The High Court erred in applying Section 12 after finding the agreement was a “complete package.” Principles of election and approbate-reprobate bar a party from accepting benefits under the contract while challenging its terms. |
| Judgments Relied Upon |
|
| Logic / Jurisprudence / Authorities Relied Upon by the Court |
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| Facts as Summarised by the Court |
Lease of defence lands in Coimbatore since 1942; transferred to AAI in 1947 with tripartite lease (5% of land value). In 2011, acquisition proceedings under the 1997 Act were initiated for airport expansion. Parties negotiated under Section 7(2) in 2018 and fixed compensation by agreement. Madras High Court held the Act ultra vires in July 2019; State revived it by the 2019 validation Act. GO No. 173 (Nov 2019) sanctioned compensation by consent. High Court (Aug 2020) nonetheless awarded interest under Section 12, triggering these appeals. |
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All courts and authorities adjudicating land acquisition compensation agreements under statutory provisions |
| Persuasive For | Future acquisition disputes involving Section 7-agreements and subsequent relief claims |
| Overrules | Madras High Court’s decision applying Section 12 interest after consent |
| Follows | Supreme Court precedents on finality of consent awards (e.g., Ranveer Singh, Union of India v. N. Murugesan) |
What’s New / What Lawyers Should Note
- Confirms that an agreement under Section 7(2)/(4) of the Tamil Nadu Acquisition of Land for Industrial Purposes Act, 1997, is a concluded contract excluding further statutory remedies.
- Holds Section 12 interest provision inapplicable once compensation and related claims (rent, solatium, interest) have been settled by consent.
- Reaffirms doctrine of approbate and reprobate: parties cannot accept the benefits of a statutory contract and later challenge its terms.
- Clarifies that High Court cannot rewrite a voluntary statutory agreement under its writ jurisdiction.
- Lawyers may cite this judgment to resist post-settlement interest or additional compensation claims in land acquisition matters.
Summary of Legal Reasoning
- Sections 7(2)/(4) of the 1997 Act encourage negotiation and, upon agreement, convert the arrangement into a concluded contract under the Indian Contract Act.
- A concluded contract “becomes sacrosanct,” excluding further recourse to statutory award procedures and interest provisions.
- Section 12 applies only where no agreement under Section 7 has been reached; it is triggered upon possession and remains until payment or deposit.
- The Madras High Court was correct in finding a “complete package” of claims but erred by invoking Section 12 thereafter.
- Doctrine of approbate and reprobate (election) and estoppel principles bar parties from taking contradictory positions—accepting benefits under a contract then seeking additional statutory relief.
- Prior Supreme Court precedents reinforce finality of consent awards and preclusion of further claims.
Arguments by the Parties
Petitioner
- Compensation fixed by consent in 2018 included all claims (rent, solatium, interest).
- Agreement under Section 7(2) is final and exclusive; respondents are estopped from resiling or invoking Section 12.
- Writ jurisdiction cannot reopen a statutory contract.
Respondent
- No privity of contract with private landowners.
- Interim orders on lease-rent arrears were complied with.
Private Respondents
- Entitled to just and fair compensation, including interest under Section 12.
- No express exclusion of Section 12 in the agreement; agreement does not foreclose their statutory rights.
Factual Background
Parties held long-term leases of airport lands since 1942, transferred to AAI in 1947. For airport expansion, acquisition under the 1997 Act was initiated in 2011. In March 2018, compensation rates were fixed by agreement under Section 7(2), leading some landowners to withdraw challenges. The Madras High Court (July 2019) struck down the Act; the State revived it by the 2019 validation Act. Government Order No. 173 (Nov 2019) approved negotiated rates and directed disbursement. Despite interim deposit of compensation and rent arrears, the High Court (Aug 2020) awarded interest under Section 12, triggering these appeals.
Statutory Analysis
- Section 7 of the 1997 Act is exhaustive on compensation determination:
- Sub-section (2) permits agreement on compensation, binding the parties.
- Sub-section (4) allows agreement even after Collector reference.
- An agreement under Section 7(2)/(4) excludes the remainder of Section 7 and other statutory award machinery.
- Section 12 provides for interest from possession until payment/deposit at nine percent per annum but is triggered only where no Section 7 agreement exists.
- Contractual finality under Sections 7(2)/(4) overrides Section 12 interest claims.
Dissenting / Concurring Opinion Summary
No dissenting or concurring opinions were reported.
Procedural Innovations
No new procedural precedents or guidelines were issued.
Alert Indicators
- ✔ Precedent Followed