Recent disagreements between various benches of the apex court may be a sign of discipline and propriety not being followed. Much is at stake in the hearing of a Constitution Bench next week to resolve such issues
Next week, the Supreme Court’s five-judge Constitution Bench, already hearing the challenges to biometric identification of people through Aadhaar, is expected to give primacy to the hearing of another case, which emerged out of the blue.
It is rare for two benches of the Supreme Court to make separate requests simultaneously to the Chief Justice of India (CJI) in his administrative capacity as the Master of the Roster. The request was to constitute a larger bench to resolve an apparent conflict between the rulings of two three-judge benches.
Of the two benches which made the request on February 22, one was presided by Justice Arun Mishra (sitting with Justice Amitava Roy, who has since retired), and the other was by Justice Adarsh Kumar Goel (sitting with Justice Uday Umesh Lalit). Both the benches were aggrieved with the decision and observations of a three-judge bench comprising Justices Madan B Lokur, Kurian Joseph and Deepak Gupta the previous day in a land acquisition case.
This three-judge bench admonished another three-judge bench comprising Justices Arun Mishra, Adarsh Kumar Goel and Mohan M Shantanagoudar for its February 8 judgment in Indore Development Authority v Shailendra (Dead) Through LRS & Ors. That bench had found a 2014 judgment of another three-judge bench in Pune Municipal Corporation v Harakchand Misirimal Solanki, per incuriam (characterised by lack of due regard to the law or the facts). The 2014 judgment was delivered by a bench of Justices RM Lodha (who has since retired), Justice Lokur and Justice Joseph.
The Lokur bench, on February 21, deplored that the Arun Mishra bench had on February 8 abandoned all norms of judicial discipline by declaring the 2014 judgment per incuriam despite dissent by one of the three judges (Justice Shantanagoudar) that the matter must be referred to the CJI for consideration by a larger bench.
CONVENTIONS AND PROPRIETY
Conventions and propriety demand that a bench of three judges, while disagreeing with the decision of a bench of similar strength, ought to make a reference to the CJI to constitute a larger bench of five judges to resolve the issue by articulating the reasons for their disagreement. The concern expressed by the Lokur bench on February 21 on the likely impact the decision of the Arun Mishra bench in departing from such a convention would have on the institution, was considered by many as an indictment of one bench by another. The rule of precedent is considered as sacrosanct in an institution like the Supreme Court, which sits in 12 to 15 division benches, to present a picture of unity and orderliness in its functioning to ensure public credibility and compliance with its orders.
The Lokur bench had on February 21 requested all the high courts and other benches of the Supreme Court to ignore the February 8 judgment of the Arun Mishra bench till it considered the arguments in favour of reference of the matter for consideration by a larger bench on March 7. The hearing of the case by the five-judge bench on March 6 effectively renders the March 7 hearing by the Lokur bench infructuous. That the benches which made such references to the chief justice were of similar strength of two judges each, and the fact that they did so without reasoned referral orders, makes the controversy murkier than what it looks like on the surface.
One of the cases referred by the CJI for consideration by the five-judge bench on March 6 is Indore Development Authority v Smt Shyam Verma & Ors. In this case, the respondent is the owner of a land measuring 0.231 hectares in village Tejpur, Gadbadi tehsil, Indore district. The state acquired her land for construction of a physiotherapy centre for mentally deficient children in 2004. A notice was issued to her to receive the compensation, but as she did not receive the amount, it was deposited in the government treasury.
According to Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, where land proceedings are initiated under the Land Acquisition Act, 1894 (which the 2013 Act replaced), and where award has been made five years or more prior to the commencement of the 2013 Act, and where possession is not taken or compensation has not been paid, the acquisition shall be deemed to have lapsed. As a result, the persons whose lands were acquired under the 1894 Act are entitled to greater compensation, which the 2013 Act offers for a similar acquisition. The aim of this provision is beneficial in nature, as the 1894 Act was replaced with the objective of ensuring reasonable compensation to those deprived of their lands for public purpose.
Section 31 of the 1894 Act contemplates that if, for any reason, the compensation amount has not been paid or there is no competent person to receive the compensation, the collector shall deposit the amount in court to which a reference under Section 11 would be submitted.
In 2014, the RM Lodha bench, in the Pune Municipal Corporation case, held that if the acquisition authority did not take physical possession of the land, or pay compensation to the landowners, or deposit the amount, as required under Section 31 of the 1894 Act, then the proceedings initiated under the old Act should be deemed to have lapsed.
Citing the Supreme Court’s judgment in Pune Municipal Corporation, the Indore bench of the Madhya Pradesh High Court held in the case of Smt Shyam Verma on November 30, 2015, that the land acquisition proceedings in her case, began in 2004, lapsed, as the authorities neither took possession of her land, nor deposited her compensation in a competent court. Therefore, the High Court directed the Indore Development Authority, which acquired her land under the old Act, to proceed in accordance with the 2013 Act afresh, if at all her land is still required for the public purpose.
Not satisfied with the High Court’s verdict because proceeding under the 2013 Act would involve payment of higher compensation to her for the same land, the Indore Development Authority filed the present appeal in 2016.
Smt Shyam Verma was one of the several cases decided by high courts and the Supreme Court, relying on the precedent of Pune Municipal Corporation. In that case, the amount of compensation was not paid to the land owners. Nor was it deposited in the court by the Special Land Acquisition Officer. Nine petitions were filed before the Bombay High Court to challenge the acquisition process. The High Court, in 2008, quashed the acquisition proceedings. In an appeal against the quashing order, the Supreme Court invoked Section 24(2) of the 2013 Act, to return a finding that the compensation was not paid for a period of five years prior to the commencement of Section 24(2) of the Act, and therefore, the acquisition proceedings had lapsed.
Section 24 of the 2013 Act creates a deemed fiction, that is, a provision, which in law is meant to be true. It is an assumption that something is true even though it may be untrue, made especially in judicial reasoning to alter how a legal rule operates. While interpreting the provisions creating a legal fiction, the court ascertains the purpose for which the fiction is created, and assumes all those facts and consequences which are incidental or inevitable corollaries to giving effect to the fiction.
It was, therefore, contended that since the 2013 Act is a beneficial piece of legislation enacted for the benefit of the farmers, the lapse of the proceedings under the 1894 Act is an inevitable corollary of Section 24(2) of the new Act.
The Arun Mishra bench, in its judgment in Indore Development Authority, has upset a long-standing convention in the apex court. That convention is that the decision rendered by a bench of the Supreme Court is binding on another bench of a co-equal strength. However, in the event of any reservation, the matter can be referred to a larger bench by a bench of the equal strength. It is the larger bench which can take a view contrary to the view expressed by a bench of lesser quorum. The mere fact that an argument was not raised, or reasoning of the previous bench of equal strength is fallacious, or a particular provision of the statute was not specifically noticed by the previous bench, is not a ground on the basis of which the binding precedent can be ignored.
In another case, which is before the Constitution Bench on March 6, the Punjab and Haryana High Court held that in case there is a conflict between the judgments of the co-equal strength benches of the Supreme Court, both being binding precedents, it is open to the high court to follow the judgments which it considers appropriate (State of Haryana v Maharana Pratap Charitable Trust).
The concept of “per incuriam” signifies those decisions rendered in ignorance or forgetfulness of some inconsistent statutory provisions, or of some authority binding on the court concerned. In other words, as the Arun Mishra bench explained in its judgment in the Indore Development Authority on February 8, the concept means that a given decision is in disregard of the previous decisions of the court itself, or that it was rendered in ignorance of the terms of an applicable statute or of a rule having the force of law.
The Arun Mishra bench, while disagreeing with the previous three-judge bench in Pune Municipal Corporation, on the interpretation of Section 24 of the 2013 Act, considered the question whether it ought to refer the matter for consideration by a larger bench. The Arun Mishra bench reasoned that since the acquisition had been quashed in the Pune Municipal Corporation case, there was no question of taking possession or payment of compensation under Section 24(2) of the new Act. Therefore, it held that the decision of the RM Lodha bench could not be an authority on the question, as a decision which was not germane to the case cannot be said to be a binding precedent. “It is obiter dicta and thus has to be ignored,” reasoned the Arun Mishra bench, while referring to the Lodha bench’s interpretation of Section 24(2).
The Arun Mishra bench, interpreting Section 24(2), thus held that the non-deposit of compensation in court under Section 31(2) of the Act of 1894 does not result in a lapse of acquisition under Section 24(2) of the 2013 Act, as held by the Lodha bench in the Pune Municipal Corporation case. Due to the failure of deposit in court, the only consequence at the most may be of a higher rate of interest on compensation as envisaged under Section 34 of the Act of 1894, and not lapse of acquisition, it added. Landowners after refusing to accept the compensation amount cannot take advantage of their own wrong and seek protection under Section 24(2), the Arun Mishra bench further reasoned.
While the Constitution Bench hearing the matter next week will possibly take a view on the correctness of this reasoning, it is the impact of this case on pending cases that interests observers. Among the pending cases is an appeal by a farmer in Gujarat, whose lands were acquired for the purpose of a Special Economic Zone (SEZ) project to be run by the Reliance Industries Limited (RIL) in Jamnagar, Gujarat. RIL had taken possession of 95 percent of the lands acquired, and paid compensation to the landowners. In the remaining five percent, the collector failed to take possession, and the compensation was not accepted by the dispossessed farmers, due to which the amount was not deposited in the court.
The Gujarat High Court ruled in favour of Reliance, holding that Section 24(2) could not apply to companies on whose behalf the state had acquired the land. If the State failed to take possession within the time stipulated, the company cannot be held responsible, the High Court held.
The outcome of the hearing by the Constitution Bench is likely to have a bearing on this matter to be heard by the Arun Mishra bench on March 7. Needless to add, if the interpretation of Section 24(2) by the Arun Mishra bench in Indore Development Authority is sustained, it is likely to favour RIL and other corporate and state entities which want to avoid paying a huge compensation under the 2013 Act if the proceedings began under the old Act are not deemed to have lapsed on the stipulated grounds.