Fifty Years After Award, Andhra Pradesh HC Directs State to Pay 1976 Land Acquisition Compensation With 12% Interest

The Andhra Pradesh High Court at Amaravati has directed the State to pay a 1976 land acquisition award of Rs 31,377.75 with 12% interest per annum from the date of the award until actual payment, holding that the right to compensation under Article 300-A cannot be defeated by mere deposit of the amount in revenue deposits.

Justice B. Krishna Mohan, sitting singly at Amaravati, disposed of a writ petition filed by Kunisetty Hymavathy, a 72-year-old homemaker from Guntur, whose agricultural land in Martur Village, Martur Mandal, Prakasam District was acquired by the State in 1976 under the Land Acquisition Act, 1894. An award of Rs 31,377.75 was passed on 9 April 1976, but the compensation was never collected by the petitioner. Nearly five decades later, the court found that the State's obligation to pay adequate compensation persists — and that the passage of time makes the case for interest, not lapse, the appropriate remedy. The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 was held inapplicable because the acquisition process was complete under the old Act.

The Land and the Acquisition

The petitioner purchased a total extent of approximately Ac.5.20 cents of land in Martur Village in 1973 through three registered sale deeds dated 15 June 1973, covering survey numbers 608/A/A, 600/C and 601/C. The purchases were made for different extents: Ac.1.22 cents, Ac.0.99 cents, and a combined parcel of Ac.2.99 cents across those survey numbers.

In early 1976, the then District Collector, Prakasam District, initiated acquisition proceedings pursuant to proposals by the Block Development Officer dated 26 January 1976 under the 20-point economic programme. A draft notification and draft declaration were published on 19 February 1976. During the award enquiry, the petitioner's father, Maddi Satyanarayana, and her husband, Kunisetty Atmanandham, appeared before the Land Acquisition Officer and submitted objections, stating that the land had been purchased for construction of a tobacco re-drying factory. The husband gave a statement before the Land Acquisition Officer on 7 April 1976. A written representation was also submitted to the then Sub Collector, Ongole, by registered post. After considering these objections and rejecting them, the Land Acquisition Officer passed Award No. 12/1976 on 9 April 1976 for Rs 31,377.75, payable in five equal instalments.

After the award, the government divided the acquired extent of Ac.4.95 cents into house plots, prepared a layout, and granted pattas to beneficiaries of the Vaddera community of Martur Village in 1976 itself. Those allottees have been in possession and enjoyment of the plots since then.

Why the Compensation Was Never Collected

The petitioner and her husband moved to Chennai in 1975 and lived there until 1989, then shifted to Visakhapatnam until 1995, and thereafter to Vijayawada until 2000, before settling in Guntur. During this period, the husband managed the subject lands until his death on 30 November 2006. The petitioner's father, Maddi Satyanarayana, looked after the land affairs until his death in June 2008. A close relative, Kunisetty Mallikarjuna Rao, then managed the matter until he died in 2019.

It was only after the relative's death in December 2019 that the petitioner handed over the original sale deeds to her son, Kunisetty Venkata Ramalingeswara Vamsi, on 25 March 2020. He was acting as her General Power of Attorney holder and was the deponent of the writ petition. When he made enquiries, he found that the acquired land had been sub-divided into house plots occupied by third parties. The revenue authorities did not furnish details when contacted.

The State's records showed that after the award, the Revenue Divisional Officer-cum-Land Acquisition Officer, Ongole, issued notices to the petitioner to appear and collect the compensation. Notices dated 11 April 1976 were sent under Section 12(2) of the Land Acquisition Act, 1894 by registered post with acknowledgement due, and the petitioner received them as per the acknowledgement. Further notices were issued on 8 September 1976 and 21 March 1979. The petitioner did not appear to collect the amount. The compensation was subsequently remitted to revenue deposits.

The Rival Legal Contentions

The petitioner's counsel, Naresh Byrapaneni, argued that the entire acquisition proceedings, including the Section 6 declaration and the award dated 9 April 1976, were void and had lapsed by virtue of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The petitioner sought a direction to pay compensation afresh under the 2013 Act.

Separately, counsel contended that the respondents had failed to produce material showing that notice under Section 31 of the Land Acquisition Act, 1894 — requiring the petitioner to come and collect the awarded amount — was properly served. The respondents had produced notices under Sections 9(1) and 9(3) and Section 10, but no notice specifically under Section 31 was shown.

The Government Pleader for the respondents relied on the Supreme Court's Constitution Bench decision in Indore Development Authority v. Manoharlal and Others, (2020) 8 SCC 129. That decision clarified that Section 24(2) of the 2013 Act creates a deemed lapse only where possession has not been taken and compensation has not been paid, for a period of five years or more before the commencement of the 2013 Act. Where possession was taken, as in this case, there is no lapse. The decision also held that once compensation is tendered and the landowner refuses to receive it, the landowner cannot claim lapse under Section 24(2).

The court accepted the respondents' position on this point. Since the acquisition was completed under the Land Acquisition Act, 1894, possession was taken and pattas were granted to third parties in 1976, and compensation was deposited in revenue deposits after the petitioner did not collect it, the 2013 Act had no application to this case.

The Court's Reasoning on Compensation and Article 300-A

While rejecting the lapse argument, the court found that the petitioner's grievance was legitimate in a different sense: the compensation awarded in 1976 had never actually reached her hands. The court drew on a line of Supreme Court decisions to frame the State's continuing duty.

Relying on Ultra-Tech Cement Limited v. Mast Ram and Others, (2025) 1 SCC 798, the court noted the seven sub-rights of a landowner in any acquisition process, including the right to fair compensation and the duty of the State to pay such compensation expeditiously. The court quoted the principle that “fair and reasonable compensation is the sine qua non for any acquisition process.”

The court also referred to Kolkata Municipal Corporation and Another v. Bimal Kumar Shah and Others, (2024) 10 SCC 533, and Dharnidhar Mishra (D) and Another v. State of Bihar and Others, (2024) 10 SCC 605, for the proposition that the right to property under Article 300-A is both a constitutional and a human right, and that the State cannot dispossess a citizen without paying adequate compensation in accordance with law.

The court observed that money loses its purchasing power over time. What the petitioner could have bought with the compensation in 1976 cannot be replicated in 2026. Delay in disbursing compensation, the court held, contravenes the spirit of Article 300-A and the idea of a welfare State.

The court also noted that the respondent authorities, while depositing the compensation in revenue deposits, did not follow up thereafter to ensure the petitioner actually received the amount. Merely keeping money in revenue deposits does not discharge the State's obligation.

The Division Bench judgment in W.A. No. 113 of 2024 of the same High Court, directing re-determination of compensation based on current market value in a comparable situation, was also referred to by the petitioner's counsel. The court, however, did not re-determine the market value. It confined its direction to the awarded amount of Rs 31,377.75, since the acquisition was concluded under the 1894 Act and the 2013 Act was inapplicable.

On Section 24(2) and the 2013 Act

The court applied Indore Development Authority v. Manoharlal to hold that Section 24(2) of the 2013 Act does not revive stale or time-barred claims. It does not reopen concluded proceedings, nor does it allow landowners to question a completed acquisition process. Since the award was passed on 9 April 1976, possession was taken, pattas were granted to third parties in 1976, and the compensation was deposited in revenue deposits — all before the 2013 Act came into force on 1 January 2014 — the acquisition proceedings had been concluded long before the 2013 Act's operative date. The prayer to declare the acquisition lapsed and to redirect compensation under the 2013 Act was rejected.

The court also applied the Indore Development Authority ruling that where the landowner has failed to appear and receive tendered compensation, the owner cannot treat the acquisition as having lapsed on account of non-payment. The petitioner had received the notice dated 11 April 1976 under Section 12(2) of the 1894 Act by registered post with acknowledgement, and further notices had been issued in 1976 and 1979. Non-collection did not constitute non-payment by the State.

Order

Justice B. Krishna Mohan directed Respondent Nos. 2 to 4 — the Collector of Prakasam District, the Revenue Divisional Officer of Ongole Division, and the Tahasildar of Martur Mandal — to pay the awarded compensation of Rs 31,377.75 with interest at 12% per annum from 9 April 1976 until the date of actual payment. This payment is to be made within two months of receipt of the order.

In addition, if the petitioner is otherwise entitled to any other statutory benefits under the Land Acquisition Act, 1894 as on 9 April 1976, those benefits are to be determined along with interest at 12% per annum from 9 April 1976 until the date of payment, and paid within the same two-month period.

The writ petition was disposed of accordingly. Any interim order stood vacated. No order as to costs was made. All pending miscellaneous applications were closed.