Karnataka High Court
Dr A K Merchant vs The State Of Karnataka on 7 April, 2026
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 07TH DAY OF APRIL, 2026
BEFORE
THE HON'BLE MRS. JUSTICE K.S. HEMALEKHA
WRIT PETITION No.16827/2022 (LA-BDA)
BETWEEN:
DR. A.K. MERCHANT
S/O LATE MR. K.H. MERCHANT,
AGED ABOUT 65 YEARS,
NO.10, GREEN LEAF EXTENSION,
3RD CROSS, 80 FEET ROAD,
KORAMANGALA,
BENGALURU - 560034.
ALSO AT E-252,
GREATER KAILASH I,
NEW DELHI - 110048
SOLE TRUSTEE OF YAGANAGI TRUST
A TRUST
HAVING ITS POSTAL ADDRESS AT:
TUBA PALACE 113, HENNUR ROAD,
SAITPALYAM, ST. THOMAS TOWN
P.O., BENGALURU-560084.
...PETITIONER
(BY SRI V LAKSHMINARAYANA, SENIOR COUNSEL FOR
SRI CHAND PASHA, ADVOCATE)
AND:
1. THE STATE OF KARNATAKA
THROUGH THE DEPARTMENT OF HOUSING
AND DEPARTMENT OF URBAN DEVELOPMENT
M.S. BUILDING, BENGALURU - 560001.
REPRESENTED BY ITS SECRETARY.
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2. BANGALORE DEVELOPMENT AUTHORITY
CHOWDAIAH ROAD,
KUMARA PARK WEST,
BENGALURU - 560020
REPRESENTED BY ITS COMMISSIONER.
3. ADDITIONAL LAND ACQUISITION OFFICER
BANGALORE DEVELOPMENT AUTHORITY
CHOWDAIAH ROAD,
KUMARA PARK WEST,
BENGALURU - 560020.
...RESPONDENTS
(BY SRI HARISHA A.S., AGA FOR R-1;
SRI B.S. KARTHIKEYAN, ADVOCATE FOR R-2 & R-3)
THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE
CONSTITUTION OF INDIA, PRAYING TO DECLARE THAT THE
SCHEME OF THE R2 IN RESPECT OF THE SCHEDULE PROPERTY
HAS LAPSED AND HAS BEEN ABANDONED; DECLARE THAT THE
SCHEDULE PROPERTY NEVER VESTED WITH THE RESPONDENTS;
AND ETC.,
THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED
FOR ORDERS ON 09/01/2026, COMING ON FOR
PRONOUNCEMENT THIS DAY, THE COURT MADE THE
FOLLOWING:
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CORAM: HON'BLE MRS JUSTICE K.S. HEMALEKHA
CAV ORDER
The petitioner has approached this Court assailing the
acquisition proceedings initiated by the Bangalore
Development Authority in respect of land measuring 3 acres
13 guntas in Sy No. 85, Kacharakanahalli, Bangalore North
Taluk, on the ground that the scheme has lapsed under
Section 27 of the Bangalore Development Authority Act,
1976; that possession was never taken nor compensation
paid and that the acquisition cannot be revived after four
decades. The petitioner seeks for quashing of the notification
and endorsement dated 21.07.2022.
BRIEF FACTS :
2. The schedule property was purchased by one Mr. S.
F. Yaganagi in 1946 and is used for religious, spiritual and
welfare activities of Baha'i community. A preliminary
notification dated 21.03.1977 and final notification dated
14.05.1980 were issued for formation of HRBR layout. In
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1981, the Yaganagi Trust was constituted and the property
vested in the Trust. Objections were filed and sought de-
notification. Bangalore Development Authority's ('BDA' for
short) Engineering Wing on inspection, reported that the land
was not suitable for layout formation and BDA, in its
resolution 1987 recommended reconveyance. An award
dated 22.09.1986 was passed. In WP 18877/1986, this Court
stayed the award notice on 27.10.1986 preventing taking
over of possession. According to the petitioner, no
compensation was ever paid, and physical possession
remained with the Trust and that the BDA's own internal note
records that the Trust continues in possession and the
structures exist on the land. It is stated that the Trust
continued all religious, educational and welfare activities,
paid taxes, maintained katha and remained uninterruptedly
in possession for more than 4 decades. On 21.07.2022, BDA
issued an endorsement asserting that possession has been
taken in 1986, that compensation was available for collection
and sought documents. Aggrieved, the present writ petition.
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3. Sri V. Lakshminarayana, learned Senior Counsel
appearing for the petitioner, would contend that the schedule
land (Sy. No. 85, measuring 3 acres 13 guntas) has been
continuously used as a religious, spiritual and welfare center
of Baha'i faith for decades, housing, housing permanent
structures, compound walls and ancillary facilities, "Tuba
Palace". It is stated that the Trust is registered under the
Karnataka Societies Registration Act. The property functions
as a recognized center with international linkage. It is
contended that the actual settled possession with substantial
construction is evidenced through the inspection reports,
award narrative and photographs. Learned Senior Counsel
for the petitioner submits that preliminary notification was in
the year 1977 and final notification in the year 1980, award
notice was stayed by this Court on 27.10.1986 and the
interim order continued till final disposal. Consequently, no
lawful possession was taken. It is submitted that the
multiple spot inspections by the BDA officials recorded that
the land contained valuable old structures lay away from
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regular layout and was not advantageous for acquisition or
layout formation. It is submitted that the BDA resolutions
dated 03.07.1987 and 11.12.1987 expressly noted that only
33 guntas were vacant and the remainder was built up and
unsuitable. These resolutions were forwarded to government
under Section 65 sub-clause (2) and 3 of the Bangalore
Development Authority Act, 1976 ('BDA Act' for short) and
the government communications called upon the BDA to re-
examine/release the land. It is submitted that no rescission
of these resolutions followed demonstrating abandonment. It
is submitted that the mahazar dated 27.10.1986 is legally
infirm, cyclostyle, unsigned by the panchas lacking boundary
particulars. It is submitted that Section 16 sub-clause (2)
notification premised on such mahazar cannot create vesting.
Actual physical possession is a jurisdictional fact and is not
proved. Learned Senior Counsel submits that mere assertion
of deposit 'is insufficient'. There is no proof of lawful tender
or court deposit under Section 31 of the Land Acquisition Act,
1894 ('Act, 1894' for short). The vesting under Section 16
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requires both lawful possession and payment or lawful
deposit of compensation. Absence of either defeats vesting.
It is submitted that the scheme was never implemented on
this land within five years of the final notification. Where
possession is not taken and land is not utilized, Section 27
operates notwithstanding passage of time. Learned Senior
Counsel relies upon the following judgments :
(i) Girnar Traders vs State of Maharashtra and
Others1(Girnar Traders) to contend that the land
in terms of Section 16 of the Act shall vest in the
State free of encumbrance only when the
compensation is paid and possession of the land is
taken under that Act.
(ii) Offshore Holdings Private Limited vs
Bangalore Development Authority and
Others2 (Offshore Holdings Private Limited) to
contend that if possession is not taken, scheme
cannot be implemented since land is not vested.
1
(2011) 3 SCC 1
2
(2011) 3 SCC 139
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That the scheme shall be implemented within 5
years from the date of final notification under
Section 19 and that Section 27 of the BDA Act
takes care of even the consequences of default
including the date of acquisition where vesting has
not taken place under Section 36 sub-clause (3)
of the BDA Act.
(iii) Bangalore Development Authority and
Another vs Doddamuniswamapa and Others3
(Doddamuniswamappa), to contend that
possession and compensation are conjunctive for
vesting.
(iv) Banda Development Authority vs Moti Lal
Agarwal4 (Banda Development Authority), which
has been reiterated in Raghbir Singh Sehrawat
vs State of Haryana and Others5 (Raghbir
Singh Sehrawat). Relies upon para Nos. 26 to 28.
3
ILR 2014 KAR 3951
4
(2011) 5 SCC 394
5
(2012) 1 SCC 792
-9-
(v) Dr.A.Parthasarathy and Others vs State of
Karnataka6 (A.Parthasarathy). Learned Senior
Counsel submits that there is a discrimination
under Article 14 of the Constitution. The
acquisition proceeding of the neighboring land of
the same village i.e. Kacharakanahalli Village,
which was subject matters of the same
preliminary and final notification, are quashed by
this Court on the ground that the possession has
not been taken.
(vi) India Campus Crusade for Christ vs State of
Karnataka and Others7. (India Campus Crusade
for Christ)
(vii) Sri C Jacob vs The Secretary, Department of
Housing and Urban Development and
Another8.
6
ILR 2017 KAR 3489
7
WP. 14947/2024, DD 12.09.2024
8
WP No. 33803/2016, DD 10.02.2020
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(viii) Smt. Prema vs State of Karnataka and
Others9 (Prema)
(ix) Jacob Kantharaj @ Kanickya Raju vs State of
Karnataka and Others10 (Jacob Kantharaj)
wherein it is held that if a land is released in
favour of one owner under a notification, the
similar treatment can be claimed by the other
owner on the principle of parity and such rights
can be claimed under a legitimate expectation on
a principle of discrimination and under the
principle of parity.
(x) Relies upon the decision of the Apex Court in Hari
Ram and Another vs State of Haryana and
Others11 (Hari Ram).
(xi) Similarly, placed reliance upon BEML Employees
House Building Co-operative Society Ltd. vs
State of Karnataka and Others12 (BEML
9
WP 419-421/2016, DD 25.02.2016
10
WP 22732/2021 D.D 22.11.2022
11
(2010) 3 SCC 621
12
(2005) 9 SCC 248
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Employees House Building Cooperative) and the
Bangalore Development Authority vs State of
Karnataka and Another13.
3.1. Learned Senior Counsel submits that the
contemporaneous inspections, binding resolutions of BDA,
recommending release, uninterrupted religious use with
permanent structures, the possession not taken, the legally
infirm mahazar and the absence of lawful payment or deposit
of compensation cumulatively established that the scheme
was never implemented on the schedule land and stood
abandoned. It is submitted that vesting did not occur.
Consequently, the acquisition lapsed under Section 24 of the
BDA Act and belated attempt to revive it after decades is
arbitrary and unsustainable.
4. Per contra, the learned counsel appearing for the
BDA submits that the final notification was issued in the year
1980. Award was passed and compensation of ` 9,24,581/-
13
WA 4718/2016, DD 01.12.2025
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was deposited in LAC 388/1980-1981. It is submitted that
the property vested in the Trust after the acquisition
commenced and the Trust cannot defeat the acquisition. It is
submitted that the representation do not amount to de-
notification. No gazette notification was issued to withdraw
acquisition. Further, it is asserted that the possession was
taken and khatha stands in BDA's name. It is contended that
the petitioner earlier agreed to take compensation, but later
questioned the amount. Refusal to receive does not
invalidate the acquisition. It is contended that compensation
having been deposited, acquisition cannot be treated as
lapsed and that the owner who refuses cannot claim lapse
under Section 24 sub-clause (2). Relies upon the Indore
Development Authority vs Manoharlal and Others14
(Indore Development Authority). Learned counsel contends
that the petitioner is not in lawful possession and once the
compensation is deposited, possession vests with the
14
AIR 2020 SC 1496
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authority. Person in occupation thereafter are trespassers.
Relies upon the following judgments :
(i) Sri Manjunath K vs State of Karnataka and
Others15 (Manjunath)
(ii) Sri Venu vs State of Karnataka and Others16
(Venu)
(iii) The Bangalore Development Authority and
Another vs Principal Secretary and Others,
W.A.4121/2017, DD 24.05.2022
(iv) Bangalore Development Authority and
Another vs Vanaja Munireddy and
Others17(Vanaja Munireddy)
(v) Dharam Chand Agarwal vs The State of West
Bengal and Others of the High Court of
Calcutta18
(vi) Delhi Agricultural Marketing Board vs
Bhagwan Devi (Dead) through her LR,19
15
WP 12241/2025, DD 01.09.2025
16
WP 22154/2023, DD 16.07.2025
17
WA 3487/2016 c/w WP 10716-79/2015, DD 21.06.2021
18
WPA 17214/2021
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(Dharam Chand Agarwal) regarding subsequent
purchaser and delay.
(vii) M/s. Evershine Monuments and Others vs
State of Karnataka and Others20 (Evershine
Monuments)
5. This Court has carefully considered the
submissions and perused the material on record. The points
that arises for consideration are,
(i) Whether the acquisition proceedings have
lapsed under Section 27 of the BDA Act?
(ii) Whether compensation was validly paid or
deposited in accordance with law so as to
constitute vesting under Section 16 of the
Land Acquisition Act, 1894?
(iii) Whether the BDA has established taking of
lawful physical possession in 1986?
19
Civil Appeal No. 10757/2017
20
WP 17852-17856/2014, DD 14.12.2017
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6. All the points are taken up together in order to
avoid repetition of facts. Section 27 of the BDA Act mandates
that the scheme shall be substantially implemented within
five years from the date of final notification, failing which the
scheme lapses insofar as the land is concerned. In the
present case though the final notification was issued on
14.05.1980 the material on record unmistakably shows that
no layout formation or development activity has ever been
undertaken on the schedule land. On the contrary, repeated
spot inspection by the BDA officials themselves recorded that
the land contained valuable, old structure was away from
regular layout and was not advantageous for the acquisition.
The BDA by its resolutions dated 03.07.1987 and 11.12.1987
categorically resolved that the land was unsuitable for layout
formation and forwarded the matter to the government for
release. These resolutions were never rescinded. The conduct
clearly establishes abandonment of the scheme qua the
schedule land. The law on this issue is no longer a res
integra. The Apex Court in Offshore Holdings Private
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Limited (supra) has held at para Nos. 37, 38 and 124 as
under :
"37. The provisions of Section 27 of the BDA Act
mandate the Authority to execute the scheme,
substantially, within five years from the date of
publication of the declaration under sub-section (1) of
Section 19. If the Authority fails to do so, then the
scheme shall lapse and the provisions of Section 36 of
the BDA Act will become inoperative. The provisions of
Section 27 have a direct nexus with the provisions of
Section 36 which provide that the provisions of the
Land Acquisition Act, so far as they are applicable to
the State Act, shall govern the cases of acquisition
otherwise than by agreement. Acquisition stands on a
completely distinct footing from the scheme
formulated which is the subject-matter of execution
under the provisions of the BDA Act.
38. On a conjunctive reading of the provisions of
Sections 27 and 36 of the State Act, it is clear that
where a scheme lapses, the acquisition may not. This,
of course, will depend upon the facts and
circumstances of a given case. Where, upon
completion of the acquisition proceedings, the land
has vested in the State Government in terms of
Section 16 of the Land Acquisition Act, the acquisition
would not lapse or terminate as a result of lapsing of
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the scheme under Section 27 of the BDA Act. An
argument to the contrary cannot be accepted for the
reason that on vesting, the land stands transferred
and vested in the State/Authority free from all
encumbrances and such status of the property is
incapable of being altered by fiction of law either by
the State Act or by the Central Act. Both these Acts do
not contain any provision in terms of which property,
once and absolutely, vested in the State can be
reverted to the owner on any condition. There is no
reversal of the title and possession of the State.
However, this may not be true in cases where
acquisition proceedings are still pending and land has
not been vested in the Government in terms of
Section 16 of the Land Acquisition Act.
x x x
124. Both these laws cover different fields of
legislation and do not relate to the same List, leave
apart the question of relating to the same entry.
Acquisition being merely an incident of planned
development, the Court will have to ignore it even if
there was some encroachment or overlapping. The
BDA Act does not provide any provision in regard to
compensation and manner of acquisition for which it
refers to the provisions of the Land Acquisition Act.
There are no provisions in the BDA Act which lay down
detailed mechanism for the acquisition of property i.e.
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they are not covering the same field and, thus, there
is no apparent irreconcilable conflict. The BDA Act
provides a specific period during which the
development under a scheme has to be implemented
and if it is not so done, the consequences thereof
would follow in terms of Section 27 of the BDA Act.
None of the provisions of the Land Acquisition Act
deals with implementation of schemes. We have
already answered that the acquisition under the Land
Acquisition Act cannot, in law, lapse if vesting has
taken place. Therefore, the question of applying the
provisions of Section 11-A of the Land Acquisition Act
to the BDA Act does not arise. Section 27 of the BDA
Act takes care of even the consequences of default,
including the fate of acquisition, where vesting has not
taken place under Section 27(3). Thus, there are no
provisions under the two Acts which operate in the
same field and have a direct irreconcilable conflict."
7. The Apex Court held that where a scheme is not
substantially implemented within five years, Section 27
operates automatically and the land cannot be kept under
acquisition indefinitely. The Apex Court further observed that
the land acquisition under the BDA Act is only incidental to
the implementation of the development scheme and cannot
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survive independently. This Court has applied the above
principle in India Campus Crusade for Christ (supra) and
has held at para Nos. 1 and 4 as under :
"1. The writ petition is filed in respect of
acquisition of writ petition schedule property by the
Bangalore Development Authority (BDA) which
measures 6 acres 2 guntas of land in Sy.No.78,
Kacharakanahalli Village, Kasaba Hobli, Bangalore
North Taluk. However, in the course of the arguments,
the same is confined to 5 acres 17 guntas of land.
x x x
4. Admittedly, inspite of preliminary and final
notifications being issued, no award has been passed
and possession of the land has not been taken so far.
In umpteen number of cases, this Court has held that
though Bangalore Development Authority Act, 1976
does not specify the time limit within which the award
has to be passed and possession has to be taken, the
acquisition proceedings has to be completed within a
reasonable period failing which the same is liable to be
set aside. The reason for the same is that the
petitioner is entitled to compensation as per the value
of the land as on the date of issuance of preliminary
notification and in the instant case, the petitioner
cannot be forced to accept the compensation for the
land as on 1977 and it would be unjust. For the said
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reason, the preliminary and final notifications are
liable to be set aside and hence, the following order is
passed:
ORDER
i. The preliminary notification dated
21.03.1977 bearing No.HC.PR.ALAO/389/BDA/76-77
and final notification dated 12.06.1980 bearing
No.HUD/49/MNJ/78 issued insofar as it relates to the
land of the petitioner for which no award has been
passed and possession is not taken by BDA, are
hereby set aside.
ii. The writ petition is disposed of
accordingly."
8. In Prema (supra) it is held at para Nos. 3 and 4 as
under:
“3. Evidently, there is a survey conducted at the
instance of the BDA, which clearly indicates that the
BDA has taken possession only in respect of 1 acre 25
guntas and the remaining land to the extent of 1 acre
27 guntas comes under the revenue built up area,
which according to the petitioner, is available with the
petitioner, which has been unutilized by the BDA and
therefore, the final notification being of the year 1980
and if the scheme has not been implemented insofar
as this extent of 1 acre 27 guntas on the ground that
it is completely built up, it is to be taken that the BDA
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does not intend to acquire or develop the land and in
terms of Section 20 of the BDA Act, would be entitled
only to impose betterment charges on the owner of
such land. In turn, the petitioner would have the
benefit of development by the BDA.
4. Consequently, the scheme insofar as these
lands are concerned would lapse and the acquisition
as well. Accordingly, the only saving made by the BDA
is that it would impose betterment charges, which the
petitioner shall pay. With that observation, the
petitions are allowed. The impugned notification in
respect of the land bearing Sy.No.21/1 of
Kacharakanahalli to the extent measuring 1 acre 27
guntas insofar as the petitioner is concerned, stands
quashed.”
9. This Court has held that the lapse can be land
specific even if the scheme survives elsewhere.
10. The respondents – BDA contend that the
possession was taken on 27.10.1986 by drawing a mahazar
and issuing a notification under Section 16 sub-clause (2) of
the Land Acquisition Act. However, the records indicate that
there was an interim order on 27.10.1986, wherein the
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further proceedings pursuant to the Award Notice dated
11.10.1986 was stayed. Once the operation of the Award
Notice was stayed, no lawful possession could have been
taken and there is no material to show other than the
document which is dated 27.10.1986 that the possession was
taken thereafter. The alleged mahazar is cyclostyle and does
not bear the signature of independent panch witness, does
not contain boundary identification and is not signed by the
land owner. Such a document cannot be treated as a proof of
actual physical possession. In A Parthasarathy (supra), this
Court has held at para Nos. 9 and 10 as under:
“9. From the above, it is clear that the
Authority did not have intention of implementing the
scheme over the entire portion of land which was
acquired, but it had done so only to create a land
bank, which is not the purpose for which Development
Authorities have been created. If this is permitted,
then any Development Authority can misuse the land
acquisition proceedings by notifying and acquiring
large tracts of land which may be in hundreds, or even
thousands of acres, for future development, which
may be proposed to be carried out even after three,
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four or five decades, and deposit the compensation at
the rate as on the date of notification which may be
awarded by the Special Land Acquisition Officer, and
deposit the same after several years, as in the present
case, it is after thirty one years of the initial
notification for acquisition, and twenty three years
even after the award had been passed. The
Development Authorities are not in the business of
land dealing, as the purpose is different, which is
proper development of cities, which may include
providing of residential accommodation to citizens, but
not create a land bank by way of compulsory
acquisition of land, thereby depriving the legitimate
owners of land for profiteering purpose by BDA. In the
present case, nearly 90% of the land so notified to be
acquired, has remained unutilized for more than three
and a half decades. The possession of the land
belonging to the appellants is said to have been taken
in the year 1986 under a ‘mahazar’ which cannot be
relied upon, and we have no reason to disturb the
finding of fact recorded by the Writ Court in this
regard, in para 27 of its judgment, which was on
perusal of the original record and is reproduced below:
The first question that falls for my consideration
is, whether the possession of the land is taken by the
Government from the petitioners? My answer to this
question is emphatically ‘no’, for the following
reasons:
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(a) The perusal of the records reveals that
the things are not done in a manner known to
law. The mahazar on which all reliance is placed
is deficient in more than one respect. It contains
the signatures of five persons, but their names,
much less their addresses, are available.
(b) The alternative portions like (i) the
petitioners were present/not present (ii) BDA
has taken over the possession/the owners have
handed over the possession (iii) malkies are
existing/not existing are retained as they are.
The non-applicable portion is not even struck
off. The mahazar prepared is in the cyclostyled
form. It is hard to give any credence to such a
mahazar.
(c) No acknowledgments for having served
the copy of the mahazar on the petitioners is
produced. It is also not the case of the
respondent BDA that the notice calling upon the
petitioners to handover the possession was sent
under RPAD.
10. The facts in the case before the Apex Court
in the case of Tamil Nadu Housing Board (supra) were
different from the facts of the present case and as
such, the ratio laid down in the said judgment would
not be applicable to these cases. Possession of land so
notified for acquisition has to be taken in a proper and
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valid manner. The findings recorded by the Learned
Single Judge, that there was no independent witness
which had signed the mahazar, nor the names and
addresses to show the identity of the alleged
witnesses was given, would be sufficient to show that
the ‘mahazar’ was not prepared in a valid and legal
manner. The same was done in a mechanical manner
on a cyclostyle form, and the Learned Single Judge
has rightly held that ‘it is hard to give any credence to
such mahazar’. Learned Counsel for respondents has
also not denied the fact that no notice was ever given
to the appellants for handing over possession and
straight away the ‘mahazar’ had been prepared, the
authenticity of which is extremely doubtful.”
11. And similar view has been reiterated in Jacob
(supra) wherein at para No. 6 it is held as under:
“6. In the light of the above, this Court finds
that the respondent-BDA has in fact admitted that the
preliminary notification was issued on 27.06.1978 and
final notification was issued on 09.01.1985 and
thereafter no award has been passed nor possession
of the land in question has been taken in accordance
with law. In the endorsement dated 28.04.2005
nothing is stated regarding any impediment in passing
the award or payment of compensation. Therefore, in
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the light of the decisions mentioned above and for the
reasons stated therein, this court proceeds to pass the
following:
ORDER
(i) The writ petition is allowed.
(ii) It is hereby declared that the acquisition
proceedings in respect of the land in
question has stood abandoned and
consequently lapsed.”
12. This Court has held that a mahazar which is
unsigned, unsupported by panch witness or prepared
mechanically does not establish lawful taking of possession.
Significantly, the BDA’s own internal survey and inspection
report placed on record by the petitioner acknowledges the
existence of building, trees and religious structures on land
and record that actual physical possession was not taken at
any point of time.
13. The vesting of land under Section 16 of the Land
Acquisition Act is a legal consequence that arises only when
two conditions are satisfied. (i) payment or lawful deposit of
compensation and (ii) taking of actual physical possession. In
– 27 –
Girnar Traders (supra), the Apex Court has held at para
No.168 as under :
“168. There are different kinds of vesting of
lands as mentioned in the two Acts. The State Act has
multi-dimensional purposes leading to primary object
of planned development, while the Central Act has
only one dimension i.e. acquisition of land for a
specified public purpose. The land, in terms of Section
16 of the Central Act shall vest in the State free of
encumbrances only when the compensation is paid
and possession of the land is taken under that Act.
Section 48 of the Central Act empowers the State to
withdraw from acquisition of any land of which
possession has not been taken, despite the fact that
award may have been pronounced in terms of Section
11 of the Central Act. But once there is complete
vesting of land in the State it amounts to transfer of
title from owner to the State by fiction of law.”
14. The Apex Court held that the vesting under Section
16 occurs only after compensation is paid and possession of
the land is taken and that vesting results in complete
divestiture of the owner’s title only upon satisfaction of both
conditions. The respondents have not produced any material
to show that the compensation was either tendered to the
– 28 –
petitioner or deposited before the competent Civil Court in
accordance with Section 31 of the Land Acquisition Act. Mere
internal accounting entries or statements that amount was
“deposited with the authorities”, do not satisfy the statutory
requirement. This Court in Doddamuniswamappa has held
at para No.8 as under :
“8. Before moving further it would be apposite
to mention the recent decision of the Apex Court in
Prahlad Singh v. Union of India [(2011) 5 SCC 386] .
Their Lordships were called upon to consider Section
16 of the Land Acquisition Act, 1894 which envisages
that- “When the Collector has made an award under
Section 11, he may take possession of the land, which
shall thereupon vest absolutely in the Government
free from all encumbrances”. In Prahlad Singh their
Lordships held as follows:
“13. We have given our serious
thought to the entire matter and carefully
examined the records. Section 16 lays
down that once the Collector has made an
award under Section 11, he can take
possession of the acquired land.
Simultaneously, the section declares that
upon taking possession by the Collector,
– 29 –
the acquired land shall vest absolutely in
the Government free from all
encumbrances. In terms of the plain
language of this section, vesting of the
acquired land in the Government takes
place as soon as possession is taken by
the Collector after passing an award under
Section 11. To put it differently, the
vesting of land under Section 16 of the Act
presupposes actual taking of possession
and till that is done, legal presumption of
vesting enshrined in Section 16 cannot be
raised in favour of the acquiring
authority…….”.
The dicta is to the effect that if actual possession of
the land is not taken, such land cannot vest in the
State. In the case in hand, in the background of the
uncontroverted case of the parties that as against the
entire land owned by the respondents, only a fraction
thereof measuring 01 acres 06 guntas could not be
taken possession of because it was heavily built up as
well as heavily populated/occupied. The effect is that
this parcel of the land though notified was not
acquired as physical/actual possession was not taken
by the BDA and therefore it would not be necessary to
go in to the question of whether it could be re-
conveyed or de-notified, on the premise of
– 30 –
HANUMAIAH as the facts in the present case are
wholly distinct.”
15. This Court held that the absence of either
possession or payment defeats vesting and acquisition
cannot be treated as complete. Regarding the possession
being not taken and compensation was not lawfully paid, it is
also relevant to refer to the judgment of the Apex Court in
the case of NAL Layout Residents Association vs
Bangalore Development Authority and Others21 wherein
at para 47 it is held as under :
“47. In Banda Development Authority v. Moti
Lal Agarwal (2011) 5 SCC 394 : (2011) 2 SCC (Civ)
747], this Court has considered the question of taking
up possession of acquired land after noticing all earlier
judgments of this Court. This Court culled out the
principles in para 37 of the judgment, which is quoted
as below: (SCC p. 411)“37. The principles which can be culled
out from the abovenoted judgments are:
21
(2018) 12 SCC 400
– 31 –
(i) No hard-and-fast rule can be laid down as
to what act would constitute taking of possession of
the acquired land.
(ii) If the acquired land is vacant, the act of
the State authority concerned to go to the spot and
prepare a panchnama will ordinarily be treated as
sufficient to constitute taking of possession.
(iii) If crop is standing on the acquired land
or building/structure exists, mere going on the spot
by the authority concerned will, by itself, be not
sufficient for taking possession. Ordinarily, in such
cases, the authority concerned will have to give
notice to the occupier of the building/structure or
the person who has cultivated the land and take
possession in the presence of independent
witnesses and get their signatures on the
panchnama. Of course, refusal of the owner of the
land or building/structure may not lead to an
inference that the possession of the acquired land
has not been taken.
(iv) If the acquisition is of a large tract of the
land, it may not be possible for the
acquiring/designated authority to take physical
possession of each and every parcel of the land and
it will be sufficient that symbolic possession is
taken by preparing appropriate document in the
presence of independent witnesses and getting
their signatures on such document.
– 32 –
(v) If beneficiary of the acquisition is an
agency/instrumentality of the State and 80% of the
total compensation is deposited in terms of Section
17(3-A) and substantial portion of the acquired
land has been utilised in furtherance of the
particular public purpose, then the court may
reasonably presume that possession of the
acquired land has been taken.””
16. Earlier the Apex Court in Raghbir Singh
Sehrawat (supra) at para Nos.26,27, 28 has held as under :
“26. Bhagwati, J. (as he then was) and Gupta,
J., who constituted the majority did not agree with
Untwalia, J. and observed as under: (Balwant Narayan
Bhagde case [(1976) 1 SCC 700] , SCC pp. 711-12,
para 28)
“28. … We think it is enough to state that
when the Government proceeds to take
possession of the land acquired by it under the
Land Acquisition Act, 1894, it must take actual
possession of the land, since all interests in the
land are sought to be acquired by it. There can
be no question of taking ‘symbolical’ possession
in the sense understood by judicial decisions
under the Code of Civil Procedure. Nor would
possession merely on paper be enough. What
the Act contemplates as a necessary condition of
– 33 –
vesting of the land in the Government is the
taking of actual possession of the land. How
such possession may be taken would depend on
the nature of the land. Such possession would
have to be taken as the nature of the land
admits of. There can be no hard-and-fast rule
laying down what act would be sufficient to
constitute taking of possession of land. We
should not, therefore, be taken as laying down
an absolute and inviolable rule that merely going
on the spot and making a declaration by beat of
drum or otherwise would be sufficient to
constitute taking of possession of land in every
case. But here, in our opinion, since the land
was lying fallow and there was no crop on it at
the material time, the act of the Tahsildar in
going on the spot and inspecting the land for the
purpose of determining what part was waste and
arable and should, therefore, be taken
possession of and determining its extent, was
sufficient to constitute taking of possession. It
appears that the appellant was not present
when this was done by the Tahsildar, but the
presence of the owner or the occupant of the
land is not necessary to effectuate the taking of
possession. It is also not strictly necessary as a
matter of legal requirement that notice should
be given to the owner or the occupant of the
– 34 –
land that possession would be taken at a
particular time, though it may be desirable
where possible, to give such notice before
possession is taken by the authorities, as that
would eliminate the possibility of any fraudulent
or collusive transaction of taking of mere paper
possession, without the occupant or the owner
ever coming to know of it.”
27. In Banda Development Authority v. Moti Lal
Agarwal [(2011) 5 SCC 394 : (2011) 2 SCC (Civ) 747]
, the Court referred to the judgments in Balwant
Narayan Bhagde v. M.D. Bhagwat [(1976) 1 SCC 700]
, Balmokand Khatri Educational and Industrial Trust v.
State of Punjab [(1996) 4 SCC 212] , P.K. Kalburqi v.
State of Karnataka [(2005) 12 SCC 489] , NTPC Ltd.
v. Mahesh Dutta [(2009) 8 SCC 339 : (2009) 3 SCC
(Civ) 375] , Sita Ram Bhandar Society v. Govt. (NCT
of Delhi) [(2009) 10 SCC 501 : (2009) 4 SCC (Civ)
268] and culled out the following propositions: (Banda
Development Authority case [(2011) 5 SCC 394 :
(2011) 2 SCC (Civ) 747] , SCC p. 411, para 37)
“(i) No hard-and-fast rule can be laid
down as to what act would constitute taking of
possession of the acquired land.
(ii) If the acquired land is vacant, the act
of the State authority concerned to go to the
spot and prepare a panchnama will ordinarily be
– 35 –
treated as sufficient to constitute taking of
possession.
(iii) If crop is standing on the acquired
land or building/structure exists, mere going on
the spot by the authority concerned will, by
itself, be not sufficient for taking possession.
Ordinarily, in such cases, the authority
concerned will have to give notice to the
occupier of the building/structure or the person
who has cultivated the land and take possession
in the presence of independent witnesses and
get their signatures on the panchnama. Of
course, refusal of the owner of the land or
building/structure may not lead to an inference
that the possession of the acquired land has not
been taken.
(iv) If the acquisition is of a large tract of
land, it may not be possible for the
acquiring/designated authority to take physical
possession of each and every parcel of the land
and it will be sufficient that symbolic possession
is taken by preparing appropriate document in
the presence of independent witnesses and
getting their signatures on such document.
(v) If beneficiary of the acquisition is an
agency/instrumentality of the State and 80% of
the total compensation is deposited in terms of
Section 17(3-A) and substantial portion of the
– 36 –
acquired land has been utilised in furtherance of
the particular public purpose, then the court
may reasonably presume that possession of the
acquired land has been taken.”
28. If the appellant’s case is examined in the
light of the propositions culled out in Banda
Development Authority v. Moti Lal Agarwal [(2011) 5
SCC 394 : (2011) 2 SCC (Civ) 747] we have no
hesitation to hold that possession of the acquired land
had not been taken from the appellant on 28-11-2008
i.e. the day on which the award was declared by the
Land Acquisition Collector because crops were
standing on several parcels of land including the
appellant’s land and possession thereof could not have
been taken without giving notice to the landowners.
That apart, it was humanly impossible to give notice
to a large number of persons on the same day and
take actual possession of the land comprised in
various survey numbers (total measuring 214 acres 5
kanals and 2 marlas).”
17. Both the above decisions of the Apex Court in NAL
Layout Residents Association and Raghbir Singh
Sehrawat (supra) is by placing reliance upon the Banda
Development Authority (supra), wherein it is clarified that
while drawing of possession mahazar may constitute
– 37 –
evidence in cases of large tracts of vacant land, such
presumption cannot arise where the land is built up, occupied
or contains existing structures. In such cases actual physical
possession must be demonstrated by clear and convincing
evidence. The same principle has been reiterated in
subsequent decisions concerning the development authorities
and layout acquisition, wherein it has been consistently held
that mere preparation of a mahazar or issuance of Section 16
sub-clause (2) notification cannot substitute the requirement
of actual possession, particularly where the land owner
continues to remain in settled possession. In the present
case, the respondents have not produced any reliable
material demonstrating that petitioner or the Trust was ever
dispossessed from the schedule property. On the contrary,
the records indicate continued occupation and use of the
land.
18. The learned counsel appearing for the respondents
also rely upon the dismissal of W.P 18877/1986 to contend
that the present challenge is bad. The earlier petitions were
– 38 –
not decided on the merits of the acquisition, nor was the
issue of lapse or vesting possession adjudicated. The present
challenge is founded on subsequent statutory events and a
fresh cause of action. Thus the objection of res judicata
raised by the respondents is unsustainable and is accordingly
rejected. The earlier writ petition did not culminate in any
adjudication on legality of the acquisition, lapse of the
scheme, vesting or possession. The learned counsel
appearing for the respondents also sought to contend that
the petitioner is a subsequent purchaser after the land
acquisition proceedings initiated and placed reliance upon the
decisions stated supra that a subsequent purchaser after
acquisition of notification has no locus standi to challenge the
acquisition and that the acquisition proceedings cannot be
reopened after a long delay and once possession is taken and
vesting occurs the land owner cannot seek to question the
acquisition. However the reliance placed upon the judgments
does not assist the respondents on the facts of the present
case, as the petitioner is not a purchaser, but derives title
– 39 –
from original owner who purchased the property in 1946,
much prior to the acquisition notification. The authorities
relied by the respondents proceed on the premise that lawful
possession had been taken and vesting had occurred. In the
present case, no material demonstrates that the possession
was ever lawfully taken and compensation was not paid or
deposited in accordance with law. Hence, the principles laid
down in the afore decisions do not apply to the facts of the
present case and they are distinguishable. As stated supra in
Raghbir Singh Sehrawat (supra), wherein it is held that
symbolic or paper possession cannot be treated as valid,
taking of possession and that acquiring authority must
establish actual and physical possession of the land.
Accordingly the points framed for consideration are answered
and this Court pass the following :
ORDER
(i) The Writ Petition is allowed.
(ii) It is declared that the acquisition
proceedings initiated by the respondents-
– 40 –
BDA under the preliminary notification dated
21.03.1977 and final notification dated
14.05.1980 insofar as they relate to the
schedule property bearing Sy. No. 85,
measuring 3 acres and 13 guntas situated at
Kacharakanahalli Village, Bangalore North,
have lapsed.
(iii) The endorsement dated 21.07.2022 issued
by the respondent No. 2 is hereby quashed.
(iv) It is made clear that this order shall not
preclude the respondents from initiating
fresh acquisition proceedings if so advised in
accordance with law.
Sd/-
________________________
JUSTICE K.S. HEMALEKHA
CKL