Supreme Court upholds 2019 Act validating Tamil Nadu Land Acquisition Laws; Explains legislative competence to pass a retrospective validating Act

Supreme Court: The bench of AM Khanwilkar* and Dinesh Maheshwari, JJ has upheld the validity of the Tamil Nadu Land Acquisition Laws (Revival of Operation, Amendment and Validation) Act, 2019 and has found it to be consistent with and within the four corners of Article 254 of the Constitution of India.

Legislative Trajectory

• The State of Tamil Nadu carved out three public purposes for which a law, different from the Land Acquisition Act, 1894, was required to be enacted. The Tamil Nadu legislative assembly, hence, enacted the Tamil Nadu Acquisition of Land for Harijan Welfare Schemes Act, 1978, Tamil Nadu Acquisition of Land for Industrial Purposes Act, 1997 and Tamil Nadu Highways Act, 2001.
• The Right   to   Fair   Compensation   and   Transparency   in   Land Acquisition, Rehabilitation and Resettlement Act, 2013 came into force after the 1894 Act was found to be inadequate on certain aspects.
• The State of Tamil Nadu also sought to protect and reserve its three State enactments — and hence, a State amendment, namely, the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement (Tamil Nadu Amendment) Act, 2014 was effected to the 2013 Act whereby Section 105-A came to be inserted in the 2013 Act.
• The 2014 Act, along with the 1997 Act and 2001 Act, came to be challenged before the High Court of Judicature at Madras, primarily on twin grounds of repugnancy with the 2013 Act and violation of Article 14 due to manifest arbitrariness and discrimination in the operation of the State Acts.
• The Madras High Court vide judgment and order dated 03.07.2019 rejected the challenge as regards the violation of Article 14 and non-application of mind by the President while granting assent. On the point of repugnancy, however, it found that the State enactments became repugnant to the 2013 Act and thus void, on 27.09.2013 itself (date of Presidential assent to the 2013 Act). Resultantly, subsequent enactment of 2014 Act w.e.f. 01.01.2014 would not go on to reactivate the three enactments. The High Court held that the State enactments could only be revived through re-enactment by the Legislative Assembly followed by fresh assent of the President in accordance with Article 254 of the Constitution.
• The State Government then made an attempt to revive the three enactments held to be void and unconstitutional by the High Court by using a legislative tool. The Tamil Nadu Land Acquisition Laws (Revival of Operation, Amendment and Validation) Act, 2019 was then enacted to revive the operation of the 1978, 1997 and 2001 Acts. Notably, the 2019 Act was applied retrospectively from 09.2013 with the objective to validate all pending acquisitions on and after that date under the State enactments, otherwise quashed by the High Court.

Analysis

Legislative competence to pass a retrospective validating Act:

(i) The legislature must be having power over the subject matter as also competence to make a validating law.

(ii) There must be a clear validating clause coupled with substantive change in the earlier position.

(iii) The retrospective operation must be specified clearly.

(iv) There can be no express or declaratory overruling of the judgment of the Court.

(v) It is permissible for the legislature to make a decision of the Court ineffective by removing the material basis of the decision in the manner that the Court would not have arrived at the same   conclusion had the corrected/modified position prevailed at the time of rendering the said earlier decision.

Why was the 2019 Act enacted?

The 2019 Act is a conscious attempt by the State legislature to bring four material aspects of land acquisition under the three State enactments at par with the 2013 Act i.e., compensation, rehabilitation, resettlement and infrastructure facilities.

While enacting the 2019 Act, the State legislature neither individually placed the 1997 Act and 2001 Act in the form of fresh bills before the House, nor introduced amending Acts for the said three enactments in order to incorporate the provisions of compensation, resettlement and rehabilitation. Instead, it framed one bill that sought to achieve four purposes –

1. amend the State enactments to provide for different provisions of compensation to bring them in line with the law made by the Parliament;
2. add fresh provisions relating to resettlement, rehabilitation and infrastructure amenities at par with the 2013 Act;
3. revive the enactments declared to be repugnant and void by the High Court and validate them after passing this bill in the assembly and placing it before the President; and
4. restore the validity of all past acquisitions under the State legislations, quashed by the High Court by making the Act operative from a retrospective date.

The legislative intent behind the 2019 Act and more particularly, the assent accorded thereto by the Governor and the President of India for overcoming repugnancy with the Act made by   the   Parliament, was to revive the operation of the State enactments declared as null and void being unconstitutional and repugnant to the Act made by the Parliament and to amend the same, as well as, validate the actions already taken by the State authorities thereunder.

Failure to import all provisions of the law made by the Parliament – Effect of

“To say that failure to import all provisions of the law made by the Parliament in the State enactments results into non-removal of defects pointed by the High Court, is nothing but a palpable misreading of the judgment of the High Court.”

Notably, the judgment of the High Court nowhere points out the exact provisions from the State enactments which are repugnant to the law made by the Parliament. The only defect pointed out by the High Court was the impermissibility of Section 105-A (coming into effect from 01.01.2014), as a tool for reviving the State enactments once rendered repugnant (on 27.09.2013) due to law made by the Parliament. The State has since been advised to accept that defect pointed out by the High Court and has moved on from that thought process by devising a new legislative tool for validating the State enactments in line with Article 254(2).

“Had the legislature re-enacted Section 105-A even after the declaration of invalidity by the High Court, it would have been a case of non-removal of defect pointed out by the High Court. In fact, that would have been declaratory overruling of the judgment of the Court by the legislature, which is simply impermissible.”

The effect of the 2019 Act is to change the law retrospectively and not to overrule the judgment of the Court. Hence, there is no irreconcilability between the High Court judgment and the 2019 Act.

“The 2019 Act is an evolution, not reiteration of the earlier position much less regression thereof.”

The actual repugnancy not pointed out to the President while obtaining assent – Effect of

After duly specifying the existence of distinctive provisions in various enactments, particularly relating to compensation, resettlement, rehabilitation and infrastructural facilities, the letter clearly states that some provisions of the 2019 Act could be said to be repugnant to the 2013 Act and thus, the Act is being placed for consideration of the President as per Article 254.

As per the law laid down in Kaiser­I­Hind Pvt. Ltd. v. National Textile Corpn. (Maharashtra North) Ltd., (2002) 8 SCC 182, so far the assent under Article 254 is concerned, mere supply of copy of the bill may obviate the need to pin¬point provisions thereunder but the law made by the Parliament which is sought to give way to the State law must be clearly specified.

In the present case, the letter seeking assent clearly,

• demonstrated that the three State enactments were made for the purpose of speedy acquisitions.
• stated that the law made by the Parliament rendered the three enactments repugnant and out of operation owing to the Madras High Court judgment.
• stated that the State has considerable interest, having a strong bearing on the public exchequer, in saving and reviving the three State enactments.
• specified the law made by the Parliament, which could be coming in the way of the State enactments for due consideration by the President.

Hence, the communication was in compliance with the mandate of Article 254 as well as with the decision of this Court in Kaiser-I-Hind Pvt. Ltd.

[G. Mohan Rao v. State of Tamil Nadu, 2021 SCC OnLine SC 440, decided on 29.06.2021]

*Judgment by: Justice AM Khanwilkar

Know Thy Judge| Justice AM Khanwilkar

Appearances before the Court by:

For Petitioners: Senior Advocate P. Wilson and Advocate Suhrith Parthasarthy

For State: K.K. Venugopal, Attorney General for India

For Respondents: Senior Advocate Aman Sinha