Rs 15 crore more into court or the stay goes: terms set in a 2005 land acquisition
Justices Dipankar Datta and Sheel Nagu continued the Gujarat High Court's stay on a Rs 67 crore award for two months, conditional on a further deposit with the Registrar General.
JK Paper Ltd must deposit a further Rs 15 crore with the Registrar General of the Gujarat High Court within two months if it wants to keep a stay on a Rs 67.48 crore land acquisition award, the Supreme Court has ordered. Failing that, the High Court's stay on the award and on execution proceedings stands revoked and the landowners may go back to the Executing Court. Hearing cross-appeals by the company and by three landowners, a Division Bench of Justice Dipankar Datta and Justice Sheel Nagu declined to decide the disputed facts itself, sent them back to the first appellate court, and shut one argument down permanently on the way.
From Rs 124 to Rs 950 a square metre, and a Rs 67 crore warrant
The land is Block No. 207 of Village Gunsada, measuring 1,40,504 square metres, about 34.72 acres. Acquisition proceedings were initiated under the Land Acquisition Act, 1894 for the benefit of the company. The Special Land Acquisition Officer valued the land at Rs 124 per square metre. On a reference, the Reference Court's award of 23 February 2023 raised that to Rs 950 per square metre, with a 12 per cent escalation in price, solatium at 30 per cent, and interest at 9 per cent for the first year and 15 per cent thereafter from the date of receipt of possession.
Both sides appealed. The company's First Appeal No. 2489 of 2023 challenges the Rs 950 valuation; the landowners' First Appeal No. 1653 of 2023 seeks Rs 1,500 per square metre. Both remain pending before the Gujarat High Court. Meanwhile the landowners moved the Executing Court, which on 23 May 2025 issued a warrant to recover Rs 67,48,34,981 from the company for deposit with that court, subject to the outcome of the first appeals.
By a common order of 30 June 2025 the High Court stayed both the award and the execution proceedings, on condition that the company deposit 50 per cent of the awarded additional compensation along with solatium, price rise and interest at the rates in the award. Its own working put the additional compensation at Rs 826 per square metre, being Rs 950 less the Rs 124 already paid, and the total with interest at Rs 63,92,88,361, the bulk of it the 15 per cent interest running from 2006. On deposit, the landowners could withdraw half of it against security, with the balance held in a fixed deposit renewed every three years until the appeals were decided. The company told the Supreme Court it has deposited Rs 9,33,33,744 so far.
Possession completed, and the gorge argument closed for good
Two things had moved while the appeals were pending in Delhi. At an early hearing it was represented that the company had not been put in possession of about 24.77 acres, and the Court directed on 4 November 2025 that possession be delivered. Pursuant to a further order of 22 September 2026, the State of Gujarat filed an affidavit stating that as on 10 November 2025 the Mamlatdar had handed over the remaining 24.77 acres, the company having until then held only 9.95 acres. Possession of the whole of the land has therefore passed.
The company had also argued that a gorge running through the land caused waterlogging and reduced the useful area available to it. The Bench dealt with this at the outset, so that it would not resurface in the High Court. On the materials on record, including the company's own letter of 6 July 2026 to the Mamlatdar, it rejected the assertion: the company had known of the gorge, the associated waterlogging and the other encumbrances ever since the acquisition proceedings were initiated, and it was too late in the day to raise them, particularly as those proceedings had begun as far back as 2005 for its own benefit. The company is not entitled to raise any such issue before the High Court.
Why the Supreme Court would not decide the facts
What remains is a set of disputed questions of fact, including when the company first came into possession of the land or part of it and to what extent possession was made over — questions that will bear directly on the final compensation payable.
Those belong to the first appellate court. The Bench recalled Malluru Mallappa (Dead) v. Kuruvathappa and Ors., (2020) 4 SCC 313, on the width of that court's role: an appeal is a continuation of the original proceedings, appellate jurisdiction ordinarily involves a rehearing on law as well as fact, a first appeal is a valuable right in which all questions of fact and law decided by the trial court are open for reconsideration, and the first appellate court must address every issue and give reasons on the oral and documentary evidence. With the first appeals still pending before the High Court, which remains the appropriate forum to determine such questions, the Court said it would be loath to use its jurisdiction under Article 136 to wade into the waters of a fact-finding court.
Order
The High Court's stay will continue for two months. Within that period the company must deposit an additional Rs 15 crore with the Registrar General of the High Court, without prejudice to the rights and contentions of either side in the pending first appeals. If it does not, the stay of the award and of the execution proceedings stands revoked and the landowners are at liberty to pursue their claim before the Executing Court. If the deposit is made, the interim stay continues until the High Court orders otherwise. The Registrar General is to invest the Rs 15 crore in a short-term interest-bearing fixed deposit with a nationalised bank on auto-renewal. Because the acquisition dates back to 2005, the High Court has been requested to expedite the first appeals, bearing in mind the handover of 24.77 acres on 10 November 2025, with every point other than the one decided on the gorge left open. The appeals were disposed of on those terms.