A Constitution Bench of the Supreme Court has entered the second week hearing arguments over the presidential reference regarding disposal of natural resources of the country. It has to decide on the preliminary objection that the reference is actually a “review in disguise” of its 2G spectrum judgment. Only if the court declares that it is not a review, it will go into the substantive questions raised by the president. The court will give its decision in two months because the Chief Justice, who heads the Bench, is retiring in late September.
The scope of a review is very limited. The court will examine the judgment only for any “error apparent on the face of the record”. A review is the last desperate attempt to revive a lost cause. It fails in most cases. However, some litigants never lose hope.
While the Constitution Bench is hearing the preliminary objections, in an adjacent court, there was a massacre of some 330 review petitions in one go. It was a rare instance of a government authority returning twice with review petitions after the main judgment went against it. (Haryana State Industrial Development Corporation vs Mawasi). The Haryana State Industrial Development Corporation’s (HSIDC’s) review petitions were dismissed again. The court asked it to pay heavy costs of Rs 25,000 to each of the hundreds of owners of agricultural land acquired by the government for developing a model industrial township.
As in most such cases, this 17-year-old dispute was over the rate of compensation. The land acquisition collector awarded compensation at the rate of Rs 3.67 lakh per acre. When the farmers moved the district court, it doubled the rate. The appeals then moved to the high court, which fixed the price at Rs 15 lakh. The corporation and the land owners moved the Supreme Court. It increased the rate to Rs 20 lakh per acre. The corporation then moved one review petition after another, and lost each time.
How do the authorities and the courts decide the rate of compensation? Several guidelines have been laid down by the Supreme Court, like the potential for development, expenditure on it, infrastructure in the neighbourhood and quality of the land. One test, which is the most contentious, is “the market value of the land which a willing buyer would have paid to a willing seller”. Thus, an artificial price imposed by the land mafia or the executive is ruled out. However, there are still several grey areas.
In the HSIDC case, the corporation based its claim for a lower market value on an ingenious argument. It alleged that the sale of neighbouring land by Heritage Furniture Ltd to Duracell India Ltd was a wrong criterion to be adopted. That sale was for Rs 20 lakh per acre. The Supreme Court adopted that rate when it awarded Rs 20 lakh per acre. HSIDC argued that the sale between the two companies was not genuine. It contended that sale deeds of private entities are usually undervalued to save stamp duty and registration charges.
HSIDC pointed out another fact of life in the commercial world. According to it, Indian promoters usually show exorbitant prices for property to its foreign partners to benefit themselves. In this case, it was said Duracell India was thus “hoping to reap benefit of the joint venture agreement with Duracell Inc, USA”.
This may be a common practice among business partners, but the court wants evidence that there was collusion between the seller and the buyer. The first time, HSIDC only made the allegation. The second time, it brought witnesses and evidence to show that the sale between the two companies was not a genuine transaction. But both times, the court was not convinced and dismissed all the review petitions. A review petition cannot be “an appeal in disguise,” the court said. It abhors repeated reviews since they clog the system. The same week, there was another judgment that showed how agriculturists are virtually conned by land acquisition authorities. The land owners were offered Rs 1.75 per square metre when Panvel, in Navi Mumbai, was developed. The new international airport is also coming up there. The land owners were fighting for 42 years for fair compensation. (Many died during the battle.) When they sought re-determination of the rate, the rate was reduced to Rs 1.20 on the grounds that the land was underdeveloped and agriculture depended on uncertain monsoon. The farmers moved the Bombay High Court in vain. The Supreme Court allowed the land owners’ appeal, titled Sabhia Mohammed Yusuf vs Special Land Acquisition Officer, and restored the land acquisition court’s award of Rs 25 per square metre.
A new Land Acquisition Bill was on the anvil for a long time. The courts have pointed out the lacunae in the present law in several judgments. However, decade-old cases such as these, highlighting the inequities, have not spurred the law-makers to take urgent steps.