6 Oct 2010

'Vesting' of land with State: The concept understood


In a recent decision [Sulochana Chandrakant Galande v. Pune Municipal Transport] the Supreme Court has explained the concept relating to vesting of land with the State. Holding that the State acquired the land free of any encumbrances and becomes the absolute owner thereof, there was no right with the previous holder except to sue for compensation.

The Supreme Court inter alia observed as under;
9. The meaning of the word ‘vesting’ has been considered by this Court time and again. In The Fruit & Vegetable Merchants Union Vs. The Delhi Improvement Trust, AIR 1957 SC 344, this Court held that the meaning of word ‘vesting’ varies as per the context of the Statute in which the property vests. While considering the case under Sections 16 and 17 of the Act 1894, the Court held as under:–
“…the property acquired becomes the property of Government without any condition or limitations either as to title or possession. The legislature has made it clear that vesting of the property is not for any limited purpose or limited duration.” 
10. “Encumbrance” actually means the burden caused by an act or omission of man and not that created by nature. It means a burden or charge upon property or a claim or lien on the land. It means a legal liability on property. Thus, it constitutes a burden on the title which diminishes the value of the land. It may be a mortgage or a deed of trust or a lien of an easement. An encumbrance, thus, must be a charge on the property. It must run with the property. (Vide Collector of Bombay Vs. Nusserwanji Rattanji Mistri & Ors., AIR 1955 SC 298; H.P. State Electricity Board & Ors. Vs. Shiv K. Sharma & Ors., AIR 2005 SC 954; and AI Champdany Industries Ltd. Vs. Official Liquidator & Anr., (2009) 4 SCC 486).
11. In State of Himachal Pradesh Vs. Tarsem Singh & Ors., AIR 2001 SC 3431, this Court held that the terminology ‘free from all encumbrances’ used in Section 16 of the Act 1894, is wholly unqualified and would en-compass the extinguishing of “all rights, title and interests including easementary rights” when the title vests in the State. Thus, “free from encumbrances” means vesting of land in the State without any charge or burden in it. Thus, State has absolute title/ownership over it.
12. In Satendra Prasad Jain & Ors. Vs. State of U.P. & Ors., AIR 1993 SC 2517, this Court held that once land vests in the State free from all encumbrances, it cannot be divested. The same view has been reiterated in Awadh Bihari Yadav & Ors. Vs. State of Bihar & Ors., (1995) 6 SCC 31; U.P. Jal Nigam, Lucknow Vs. M/s. Kalra Properties (P) Ltd., Lucknow & Ors., AIR 1996 SC 1170; Pratap & Anr. (Supra); Chandragauda Ramgonda Patil & Anr. Vs. State of Maharashtra & Ors., (1996) 6 SCC 405; Allahabad Development Authority Vs. Nasiruzzaman & Ors., (1996) 6 SCC 424; State of Kerala & Ors. Vs. M. Bhaskaran Pillai & Anr., AIR 1997 SC 2703; M. Ramalinga Thevar Vs. State of Tamil Nadu & Ors., (2000) 4 SCC 322; Printers (Mysore) Ltd. Vs. M.A. Rasheed & Ors., (2004) 4 SCC 460; Bangalore Development Authority & Ors. Vs. R. Hanumaiah & Ors., (2005) 12 SCC 508; and Government of Andhra Pradesh & Anr. Vs. Syed Akbar, AIR 2005 SC 492. 
13. So far as the change of user is concerned, it is a settled legal proposition that once land vests in the State free from all encumbrances, there cannot be any rider on the power of the State Government to change user of the land in the manner it chooses. In a similar situation, in Gulam Mustafa & Ors. Vs. The State of Maharashtra & Ors., AIR 1977 SC 448, this Court held as under:–
“Once the original acquisition is valid and title has vested in the Municipality, how it uses the excess land is no concern of the original owner and cannot be the basis for invalidating the acquisition. There is no principle of law by which a valid compulsory acquisition stands voided because long later the requiring Authority diverts it to a public purpose other than the one stated in the.......declaration.” 
14. Re-iterating a similar view in C. Padma & Ors. Vs. Deputy Secretary to the Government of Tamil Nadu & Ors., (1997) 2 SCC 627, this Court held that if by virtue of a valid acquisition of land, land stands vested in the State, thereafter, claimants are not entitled to restoration of possession on the grounds that either the original public purpose is ceased to be in operation or the land could not be used for any other purposes.
15. In Bhagat Singh etc. Vs. State of U.P. & Ors., AIR 1999 SC 436; Niladri Narayan Chandradhurja Vs. State of West Bengal, AIR 2002 SC 2532; and Northern Indian Glass Industries Vs. Jaswant Singh & Ors., (2003) 1 SCC 335, this Court held that, the land user can be changed by the Statutory Authority after the land vests in the State free from all encumbrances.
16. In view of the above, the law can be summarised that once the land is acquired, it vests in the State free from all encumbrances. It is not the concern of the land owner how his land is used and whether the land is being used for the purpose for which it was acquired or for any other purpose. He becomes persona non grata once the land vests in the State. He has a right to get compensation only for the same. The person interested cannot claim the right of restoration of land on any ground, whatsoever.

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