TMI Blog2000 (8) TMI 1126X X X X Extracts X X X X X X X X Extracts X X X X ..... ged? Can such a protest be lodged subsequently, after receiving the payment without protest? (iii) If the acceptance of compensation under protest is the sine qua non as required by the second proviso to Section 31(2) to the making of an application under Section 18, can such a protest be made orally or whether it is necessary that such protest should always be in writing? (iv) If there is neither a written protest nor even an oral protest (assuming that oral protest is permissible) made at the time of receiving payment, is the mere making of an application under Section 18 of the Act, by itself, sufficient to infer that the claimant must be deemed to have accepted the amount under protest so as not to disentitle him of the remedy under Section 18 of the Act? In other words, can an oral protest be inferred to have been made merely because, subsequently, an application for reference has been made under Section 18 of the Act? 3. These petitions were initially heard by a learned Single Judge. He referred them to a Division Bench. His order refers to the apparent conflict in the observations in two decisions of the Apex Court viz. (i) Ajit Singh v. State of Punjab (1994) 4 S.C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant has sent Ext. P-1 on the very next day itself amply proves that he would not have received the amount on 20th May, 1996 without any protest . The Division Bench in Kannan's case decided on 24th June, 1999, preferred to rely upon the observations of the Apex Court in Ajit Singh's case (supra). 7. In view of the above, the Division Bench referred the matters to a Full Bench for resolving the conflicting views expressed by two Division Benches of this Court (i) in K. Raghavan's case and (ii) in Kannan's case. In order to answer the above questions, it is necessary to reproduce the provisions of Sections 18, 19, 20 and 31 of the Act. 8. Section 18 of the Act reads as under: 18. Reference to Court. Any person interested who has not accepted the award may, by written application to the Collector, require that the matter be referred by the Collector for the determination of the Court, whether his objection be to the measurement of the land, the amount of the compensation, the persons to whom it is payable, or the apportionment of the compensation among the persons interested. (2) The application shall state the grounds on which objection to the award is tak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the next Sub-section. (2) If they shall not consent to receive it, or if there be no person competent to alienate the land, or if there be any dispute as to the title to receive the compensation or as to the apportionment of it, the Collector shall deposit the amount of the compensation in the Court to which a reference under Section 18 would be submitted: Provided that any person admitted to be interested may receive such payment under protest as to the sufficiency of the amount: Provided also that no person who has received the amount otherwise than under protest shall be entitled to make any application under Section 18: Provided also that nothing herein contained shall affect the liability of any person, who may receive the whole or any part of any compensation awarded under this Act, to pay the same to the person lawfully entitled thereto. (3) Not with standing anything in this section, the Collector may, with the sanction of the appropriate Government, instead of awarding a money compensation in respect of any land, make any arrangement with a person having a limited interest in such land, either by the grant of other lands in exchange, the remission of l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all state the grounds on which the objection to the award is taken. Section 19 dealing with the Collector's statement to the Court enjoins the Collector to state for the information of the Court, in writing under his hand, several factors. Clause (d) of Sub-section (1) says that if the objection be to the amount of the compensation, the grounds on which the amounc of compensation was determined be stated. Section 20 dealing with 'service of notice' casts a duty on the Court to serve notices on several persons-(a) the applicant 5(b) all persons interested in the objection, except such (if any) of them as have consented without protest to receive payment of the compensation awarded; and (c) if the objection is in regard to the area of the land or to the amount of the compensation, the Collector. Reading the above provisions in Sections 31 and 18 together, there is no doubt in our mind that an application for reference under Section 18 would not be maintainable, unless it is proved that the applicant bad received the payment under protest as to the sufficiency of the amount. The second proviso to Section 31(2) leaves no manner of doubt tbat this is a pre-requisite to the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the Collector. Thereafter, on 8th August 1989, they objected to the amount of compensation determined by the Collector and claimed enhanced compensation by way of reference. On appeal by the State, the High Court reversed the decree of the reference court and held that since the claimants had agreed in Ext. B and received the compensation subject to the terms and conditions in Ext. B, they were not entitled to make an application for reference. In agreement Ext. B, they had stated: ...the total amount of compensation arrived at is fully acceptable to us . A contention was raised before the Apex Court that despite the agreement Ext. B under which the compensation was accepted, there was later on a protest and hence, the application for reference was maintainable. Construing the scheme of the provisions of Section 31 read with Section 18 of the Act in Para 4 of the judgment, the Apex Court held in Para 5 of the judgment as under: ...No person who had received the amount otherwise than under protest should be entitled to make the application under Section 18. In other words, the receipt of the amount under protest is a condition precedent to make an application under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plication under Section 18. In other words, the receipt of the amount under protest is a condition precedent for making an application for reference under Section 18 within the limitation prescribed. 20. In view of the decisions in Wardington's case and (ii) Shivabai's case, it is now well settled position in law that, claimants who receive the compensation under protest and who make application under Section 18(1) of the Act within the prescribed limitation alone are entitled to seek a reference. It is not, as if, a claimant can receive the compensation without protest and subsequently make an application for xeference under Section 18 and contend that making of application under Section 18 of the Act, itself, manifests his intention and, therefore, he must be deemed to have accepted the compensation under protest. To that extent, the observations made in para 5 of the judgment in Ajit Singh's case. ...In as much as the Appellants have filed an application for reference under Section 18 of the Act, that will manifest their intention. Therefore, the protest against the award of the Collector is implied notwithstanding the acceptance of compensation are not borne o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioned, in Section 31(2), then instead of paying the amount, he is obliged to deposit the amount in the Court to which a reference under Section 18 would be submitted. The contingencies mentioned in Section 31(2) are-(i) if the persons interested shall not consent to receive it; (ii) if there be no person competent to alienate the land; (iii) if there be any dispute as to the title to receive the compensation or as to the apportionment of it. The first proviso to Section 31 has obviously to be read with Sub-section (1) under which the payment is made to persons interested and entitled to compensation. They may receive the payment under protest as to the sufficiency of the amount. The words protest as to the sufficiency of the amount may take within their sweep several grounds on which a protest can be lodged regarding the amount not being sufficient. The grounds are already indicated in Section 18(1) discussed above. The second proviso to Section 31(2) is also to be read with Sub-section (1) dealing with the Collector making the payment to the persons interested and entitled. It makes it clear that no person who received the amount, otherwise than under protest shall be entitled ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... compensation was received without protest, application seeking a reference Under Section 18 will n it be maintainable. 26. Question No. What is the stage at which the protest contemplated by the first two provisos to Section 31(2) has to be lodged? Can such a protest be lodged subsequently, after receiving the payment without protest? The opening words of Section 18(1) of the Act are, any person interested who has not accepted the award may, by written application to the Collector require that The first proviso to Section 31(2) reads, provided that any person admitted to be interested may receive such payment under protest as to the sufficiency of the amount . The second proviso to Section 31(2) of the Act says, provided also that no person who has received the amount otherwise than under protest shall be entitled to make any a under Section 18 . Reading the above provisions together, it appears to us that, the protest must be lodged at the time of receiving the payment. If a person receives the payment without protest and then subsequently lodges the protest, it would not satisfy the requirement of the opening words of Section 18(1) or the scheme of the two provisos to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e on 16th July, 1960. The claimant received the bill drawn on the treasury for the amount payable to him on the same day at 10-30a.m, He received it without protest. Later on at 3.30 p.m., he appeared before the Land Acquisition Officer and filed a petition disputing the amount of compensation awarded to him and requiring that the matter be referred for determination by the court. He did state in the application that he had received the bill under protest, but that was an incorrect statement. The Land Acquisition Officer rejected his application on the ground that he had received the bill for the amount without protest. Claimant had cashed the bill on 18th July, 1960. Analysing the scheme of the provisions, the Andhra Pradesh High Court held that a protest is contemplated at the time of receipt of payment. It would not fit in with the scheme of the Act that the payment could be received today by a bill drawn on the Government Treasury and the person could take his own time to draw the money from the Treasury and, in the process, have for himself the intervening period at his disposal to lodge his protest. The protest must necessarily be made to the Land Acquisition Officer who tend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he judgment that if the person had accepted the payment without protest, the application for reference must be rejected without going into the merits thereof. 31. In Fateh Singh v. Land Acquisition Collector A.I.R. 1976 Delhi 162 it has been held that protest under second proviso to Section 31(2) of the Act must be made at the time when the Collector tenders the payment. Acceptance of cheque amounts to acceptance of payment, and if no protest was made at the time of such acceptance, no application will lie under Section 18 of the Act. It is immaterial that the cheque was encashed later. The cheque is looked upon as a p 3yment. Reliance was placed on the decision of Chagla, C.J. in Kirloskar Bros. Ltd. v. Commissioner of Income Tax, Bombay A.I.R. 1952 Bom 306 to hold that cheque is looked upon as a payment. If a creditor accepts the cheque in place of country's currenky, it was immaterial when the cheque was cashed; what is materiat is when the cheque was given, and the payment is made when the cheque was given and not when the cheque was encashed. 32. In Wardington's case (supra), the award was made on 17th May, 1989. The claimants received the compensation on 5th Jul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liance was placed on the two decisions of the Apex Court, viz. (t) Wardington's and (ii) Shivabai's. Special Leave Petition (C) No. 20790/98 against the decision of this Court in K. Ragha van's case was summarily dismissed on 18th January, 1999. 35. In the light of the above catena of decisions, including the two decisions of the Apex Court and one of the Division Bench of this Court in K. Raghavan's case, with respect, the view taken in Kannan's case (para 6 supra) seems to be contrary to the settled legal position. In Kannan's case, the award was made on 15th April, 1996, and ser' on the claimant on 16th May, 1996. Possession of the property was handed over on 18th May, 1 and compensation was received by the claimant on 20th May, 19 without lodging any written protest. On 21st May, 1996, the claimant submitted application under Section 18. Though the claimant stated that he had received the amount on 20th May, 1996, under oral protest, this was detied by the Land Acquisition Officer. This Court held that, the fact that claimant had sent his application for reference on the very next day itself amply proved that he would not receive the amount on 20t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lia, on persons interested in the objection, except such of them as have consented without protest to receive payment of the compensation awarded. 38. When we turn to Section 31, in none of the two proviso to Section 31(2) where the word protest occurs, is there any reference to the mode of lodging a protest or the fact that the protest should be in writing. All that is stated in the first proviso is that provided that any person admitted to be interested may receive such payment under protest as to the sufficiency of the amount . Similarly the second proviso reads thus: Provided also that no person who has received the amount otherwise than under protest shall be entitled to make any application under Section 18. No rule or form prescribed either under the Central Act or the Kerala Land Acquisition Manual has been brought to our notice to contend that the protest must necessarily be in writing or in a particular form. In this background we will turn to the relevant decisions. 39. In Wardington's case, though it is emphasised by the Apex Court that no person who had received the amount otherwise than under protest should be entitled to make the application under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the provisos to Section 31(2) can be an oral protest and it is not neccstary that the protest should always be in writing. 43. Question No. (iv) If there is neither a written protest nor even an oral protest (assuming that oral protest is permissible) made at the time of receiving payment, is the mere making of an application under Section 18 of the Act, by itself, sufficient to infer that the claimant must be deemed to have accepted the amount under protest so as not to disentitle him of the remedy under Section 18 of the Act. In other words, can an oral protest be inferred to have been made merely because, subsequently, an application for reference has been made under Section 18 of the Act. As indicated earlier, under Section 31(1), on making an award under Section 11, the Collector has to Under payment of compensation to the persons entitled thereto unless he is prevented by one or more reasons mentioned in Section 31(2). In a case where the Collector is prevented from making the payment, for one or more reasons mentioned in Sub-section (2) he is obliged to deposit the amount in the Court to which a reference under Section 18 would be submitted. Section 18 makes it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is implied assent could be made out, or to exonerate himself from some responsibility which would attach to him unless he expressly negatived his assent. * * * The formal statement, usually in writing, made by a person who is called upon by public authority to pay a sum of money, in which he declares that he does not concede the legality or justice of the claim or his duty to pay it, or that he disputes the amount demanded; the object being to save his right to recover or reclaim the amount, which right would be lost by his acquiescence. Thus, taxes may be paid under 'protest'. The word objection has been defined at page 967 and 968 in the same Dictionary as under: Objection. Act of objecting; that which is, or may be, presented in opposition; an adverse reason or argument; a reason for objecting or opposing; a feeling of disapproval. The act of a party who objects to some matter or proceeding in the course of a trial, or an argument or reason urged by him in support of his contention that the matter or proceeding objected to is improper or illegal. Used to call the court's attention to improper evidence or procedure. Such objections in open court are i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 18(1) is made does not, by itself, indicate that the claimant must have lodged the protest when he received the payment. 47. We will now refer to a few High Court decisions on the point In Mrs. S. Thomas v. The Collector of Madras A.I.R. 1958 Mad 186, the claimant had received the payment without protest. He thereafter filed an application for reference under Section 18. A contention was raised that the filing of an application for reference must be taken to mean that the claimant had not accepted the award and further that he had protested. The contention was rejected. It was held that the acceptance of an award under Section 18 and the consent referred to in Section 31(2) connote the same idea and is an inference to be drawn from the same facts. 48. In BakshiRam Jain v. State of Haryana 1997 (2) L.A.C.C. 590,(para 40 supra), the claimants contended that they had accepted the amount under oral protest as also a written protest. They had set out their claim under Section 9 of the Act for getting the market value of the land. If the amount awarded was less than what was claimed under Section 9 it was held that it would be reasonable to infer that they must not ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t requesting the Collector to refer the matter to the competent court, it was incumbent on the Collector to refer the matter in accordance with the provisions of Section 18 to a competent court. The claimant's case was that he never accepted the award. In this view of the matter, it is held that the application was maintainable under Section 18 as the acceptance of the amount offered by the Land Acquisition Officer would not preclude the claimant from raising a distpute and getting the matter referred to a competent court in accordance with law. These obseivations are made in paiagraph 4 of the judgment at page 158. 51. It is true that relying upon the observations of the Apex Court in Ajit Singh's case, a Division Bench of this Court in Kannan's case has taken the view that though there was a word against word on the question as to whether oral protest was lodged at the time of receiving compensation, the fact that on the next day the claimant had made an application under Section 18 seeking a reference it self proved that he would not have received the amount without protest on the prior day. It was held that inasmuch as the claimant had filed the application for r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation under Section 18, it is difficult to see how the making of an application under Section 18 is itself an evidence of a prior event that the protest must have been made when the compensation was received. There are cases where compensation has been received without protest and subsequently protest was lodged. The courts have refused to entertain the applications. In Mrs. S. Thoma's case (para 47 supra) the Madras High Court refused to accept the contention ihat the making of an application under Section 18 must be taken to mean that the claimant had not accepted the amount without protest. Similarly in S.M.A. Somasundaram Mudaliar's case (para 28 supra) the claimant received the amount at 10.30 a.m. without protest and later on at 3.30 p.m. appeared before the Land Acquisition Officer and raised the objection as to the amount of compensation. His application under Section 18 was rejected on the ground that he did not object to the compensation when he received the same. The Andhra Pradesh High Court confirmed the rejection. 53. In Lalithamma's case (para 23 and 29) it was emphasised that what was required was that the receipt of payment should be under protest. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oviso to Section 31(2). Such a person would therefore, not be hit by the second proviso. One can well imagine the consequence of such an interpretation. Persons receiving the amount without protest, indeed in certain cases, accepting the amount willingly and signing an agreement to that effect, as was done in Wardington's case, would later on be entitled to make an application under Section 18. If it is held that merely because a person claims to be dissatisfied with the sufficiency of the amount in the sense that he has made an application under Section 18 claiming a reference, one cannot necessarily come to the conclusion that he had accepted the amount under protest. We are afraid, such a proposition would amount to rewriting the second proviso to Section 31(2). In our view this will be wholly impermissible in the scheme of Sections 31 and 18. 56. We are aware that, in many cases, illiterate agriculturists accept the amount of compensation. We have already held above in reply to question No. 3 that an cral protest is permissible and it is not necessary that the protest should be in writing. Evidence of oral protest can be led in variety of ways. Oral prote st at the time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... column 8 of the award statement 57. Thus, on the facts of an individual case, it would depend on the actual evidence produced to come to the conclusion whether the amount was accepted under protest or without protest. Needless to say that such an excrcise can be undertaken by the Court as was done by the Apex Court itself in Shivabai's case (supra). The acquittance register was sent for and it transpired that the concerned officer himself had acted in collusion with the claimants and had made a reference at the behest of persons who could not make an application under Section 18(1) of the Act. The relevant observations are in para 9 of the judgment of the Apex Court in Shivabai's case reproduced in para 18 above. It is not unknown, though fortunately in few cases, that officers of the State Government may act in collusion with the claimants and permit an application under Section 18 being made without complying with the mandate of the provisos to Section 31(2) as it happened in Shivabai's case. Holding that the making of an application under Section 18 must itself lead to the inference that a claimant must have accepted the amount of compensation under protest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngh's case is also a two Judge Bench decision, it should be preferred to the subsequent two decisions of equal strength, namely, Wardington's case and Shivabai's case each of which was decided by two learned Judges. Our attention was invited by Mr. Philip Mathew to a decision in Indian Oil Corporation Ltd. v. Municipal Corporation (1995) 4 S.C.C 96. The facts of that case are clearly distinguishable and hence its ratio can have no application to the question raised before us. Under Article 141 of the Constitution, it is the law declared by the Apex Court which would undoubtedly be binding on all courts within the territory of India. Article 141 reads as under: 141. Law declared by Supreme Court to be binding on all courts. The law declared by the Supreme Court shall be binding on all the courts within the territory of India. Para 3 of the decision in Indian Oil Corporation's case would show that an earlier of Three Judge Bench decision of the Apex Court was rendered under the M.P. Municipal Corporation Act and was directly on the point involved between the parties. When the same parties agitated a similar contention before a Division Bench of the Madhya Prades ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lusion without reference to relevant provision of law is weaker than even casual observation. (emphasis ours) 60. K. S. Radhakrishnan, J. speaking for the Court in Alavi's case then observed: It is therefore well settled that what is the essence of a decision is its ratio and not every observation, nor what logically follows from various observations made in it. Reference was made to the decision in Quinn v. Leathern (1901) A.C. 495 , where the observations of Lord Halsbury, L.C. appeared to the following effect: ...there are two observations of a general character which I wish to make and one is to repeat what I have every often said before, that every judgment must be read as applicable to the particular facts proved or assumed to be proved, since the generality of the expressions which may be found there are not intended to be expositions of the whole law, but governed and qualified by the particular facts of the case in which such expressions are to be found. The other is that a case is only an authority for what is actually decides. I entirely deny that it can be quoted for a proposition that may seem to follow logically from it. Such a mode of reasoning ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of equal strength, the High Court must follow that judgment which appears to it to state the law more elaborately and accurately. The said observations are to be found in para 24 of the judgment at page 201. 62. Applying the above principles we have no hesitation in coming to the conclusion that the observation in Ajit Singh's case decided by the Apex Court on 18th March, 1994 namely: Inasmuch as the Appellants have filed an application for reference under Section 18 of the Act, that will manifest their intention. Therefore, the protest against the award of the Collector is implied notwithstanding the acceptance of compensation cannot be taken to be the law declared by the Apex Court so as to be binding on us by virtue of Article 141. It appears to us to be an observation and not the ratio of the judgment. On the contrary, we feel that the conclusions recorded in para 5 of the decision in Wardington's case rendered on 17th April, 1995 on a consideration of the scheme of the provisions of Section 31 read with Section 18 of the Act are the ratio of the decision in the following terms: 5. It will thus be clear that the persons interested in the land are entitled to rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tention of the Land Acquisition Officer. It is quite a different thing, to conclude that the making of an application for reference on the very next day, by itself, proves that the claimant must not have accepted the amount earlier without any protest. To that extent the decision in Kannan's case must be held to be limited to the facts of that case and not laying down any general proposition of law. Indeed it would be contrary to the ratio of the decisions of the Apex Court in Wardington's case and in Shivabai's case quoted in para 62 above. 64. In view of the above our answer to the fourth question is as under: If there is neither a written protest nor an oral protest at the time of receiving the compensation, the mere making of an application for reference under Section 18, by itself, would not be sufficient to infer that the claimant must be deemed to have accepted the amount under protest so as not to disentitle him of the remedy available under Section 18 of the Act. In other words, oral protest at the time of receiving the compensation cannot be inferred to have been made merely because, subsequently, an application for reference has been made under Section 18. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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