Not Proceeded Against For Refund; No Allegations Raised: Supreme Court Restores Land Acquisition Compensation Award In Landowner’s Favour

The Apex Court was considering the issue of whether the setting aside of an award of compensation for land acquisition, on grounds of it being excessive and resulting in unjust enrichment of some land owners, acting in collusion with the competent authority and the revenue officials, who acted in colourable exercise of powers would ipso facto result in the entire award with respect to the acquisition being set aside.

The Division Bench of Justice Sanjay Kumar and Justice K. Vinod Chandran held, “Since the appellant herein had not been proceeded against for refund or by a prosecution launched, the result of the SLP filed by the others who were specifically proceeded against by the Railways would be of no consequence in the present case.”

“Insofar as the appellant is concerned, we find absolutely no such claim having been raised at that point of time. Even the order keeping in abeyance the determination and disbursement of the enhanced amounts or the later order, recalling the enhancement Insofar as the appellant is concerned, we find absolutely no such claim having been raised at that point of time. Even the order keeping in abeyance the determination and disbursement of the enhanced amounts or the later order, recalling the enhancement”, it added.

Senior Advocate Shoeb Alam represented the Appellant, while DAG B.S. Rajesh Agrajit represented the Respondent.

Factual Background

Two sets of litigation arose with respect to the acquisition of land in the State of Chhattisgarh for a Special Rail Project. After the award was passed, certain persons also approached the Arbitrator constituted under the Land Acquisition (Special Railway Projects) Rules, 2016, for the purpose of sub-section (6) of Section 20-F of the Railways Act, 1989, in which an enhancement was granted. An inquiry was initiated, alleging excessive amounts had been awarded far greater than the actual land value. Based on the inquiry report of the Collector, an FIR was also registered against the Competent Authority, the Arbitrator, as well as other revenue officials and the persons who derived such unjust enrichment.

The accused in the said crime approached the Chhattisgarh High Court with separate writ petitions. Bastar Railways Private Limited, a Joint Venture Company, through its Executive Director, filed a writ petition impleading the State and its officers and party respondent land owners, who were alleged to be the beneficiaries of such colourable exercise of powers by the revenue authorities, carried on in collusion with them. The writ petition was allowed by setting aside the award of the competent authority and the arbitral award by the Commissioner. The Competent Authority was directed to recalculate the compensation, and the land owners/petitioners were directed to refund the amount of compensation received by them, subject to their entitlement and quantum.

The appellant, another land owner in a different village, was also granted compensation by the award of the Competent Authority; however, the quantum was not to the extent it was granted to certain land owners, against whom the respondent Railways had proceeded specifically before the High Court. The appellant, not being satisfied with the award, approached the Arbitrator who allowed enhancement. Immediately thereafter, noticing the inquiry report of the Collector, the determination of additional compensation was kept in abeyance. The arbitral award and the initial award were then set aside. The appellant approached the High Court with a writ petition, which stood dismissed, from which an appeal was filed. Aggrieved by the dismissal of the appeal, the appellant approached the Apex Court.

Arguments

The appellant asserted that there was neither identity of allegations nor was there any taint alleged, with respect to the award passed in favour of the appellant herein, who was also not proceeded against by the Railways. Based on the inquiry report, proceedings were taken only with respect to five people to invalidate the arbitral award as against them.

Reasoning

The Bench noted that the report of the Collector against the award resulted in the freezing of accounts of named land owners who were disbursed with excessive amounts, and FIRs were lodged against the government officers, who acted in abuse of their powers and the land owners, who were alleged to have obtained such unjust enrichment in collusion with the revenue officials.

The Bench further took note of the fact that the appellant herein was not a land owner who was proceeded against based on the inquiry report, either for freezing of account or arrayed as an accused in the FIR lodged. The Bench stated, “Hence, the claim of excessive compensation having been awarded and disbursed, even according to the Railways is confined to the party respondents in the earlier proceedings and the result of the SLP filed against the writ appeal judgment is of no legal or lethal consequence in the present case.”

Thus, allowing the appeal, the Bench restored the initial award passed in favour of the appellant and the enhancement granted by the Arbitrator.“The entire award amounts, deducting what has already been granted, with interest and solatium as applicable till the date of disbursement, shall be disbursed within a period of three months”, it ordered.

Cause Title: Niraj Jain v. Competent Authority-cum-Additional Collector, Jagdalpur (Neutral Citation: 2026 INSC 86)

Appearance

Appellant: Senior Advocate Shoeb Alam, AOR Sahil Tagotra, Advocates Vivek Chopda, Maulik Bhansali, Shreya Kasera, Rakesh Talukdar, Shubham Pandey

Respondent: D.A.G B.S. Rajesh Agrajit, Senior Advocate Nachiketa Joshi, AOR Ankita Sharma, Advocates Arjun D. Singh, Ishika Neogi, ASG Brijender Chahar, Advocates Praneet Pranav, Bhuvan Kapoor, Rajan Kumar Chourasia, AOR Amrish Kumar, AOR Abhikalp Pratap Singh, Advocates Aagam Kaur, Kartikey, Shubhangi Agarwal

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