Court Directs Reference To Competent Authority Where Bona Fide Dispute Exists Regarding Compensation And Land Pooling Benefits
Chandigarh, June 1: The Punjab & Haryana High Court has held that a Land Acquisition Collector cannot assume the role of a civil court and adjudicate rival claims relating to entitlement and apportionment of compensation under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The Court observed that where a genuine dispute exists between competing claimants, the Collector is statutorily bound to make a reference to the competent authority for adjudication.
A Division Bench comprising Justice Suvir Sehgal and Justice Vikas Suri passed the ruling in Gurdeep Singh & Anr. v. State of Punjab & Ors., while partly allowing a writ petition challenging an order of the Land Acquisition Collector, SAS Nagar, Mohali, rejecting the petitioners' application seeking reference of a dispute concerning entitlement to compensation and benefits arising from acquired land.
Background Of The Dispute
The controversy traces back to agreements to sell executed in 2005 and 2006 by one Attar Singh in favour of the petitioners concerning agricultural land situated in Punjab. A sale deed was subsequently executed in favour of the petitioners in February 2006. However, the transaction later became embroiled in litigation arising out of proceedings before the High Court. In contempt proceedings connected with an earlier Regular Second Appeal, the High Court directed cancellation of the sale deed but specifically ordered that the agreements to sell would remain intact, though kept in abeyance, leaving it open to the purchasers to seek enforcement at an appropriate stage.
After the second appeal was ultimately withdrawn in 2025, the petitioners instituted a suit for specific performance on the basis of the agreements to sell. Meanwhile, acquisition proceedings under the 2013 Act culminated in an award dated 08.01.2021. Respondent No.5, the legal heir of the original landowner, opted for allotment of plots under Punjab's Land Pooling Scheme instead of monetary compensation.
Claiming an enforceable interest flowing from the agreements to sell and the earlier orders of the High Court, the petitioners approached the Land Acquisition Collector under Sections 76 and 77 of the 2013 Act seeking apportionment of compensation and reference of the dispute to the competent authority. The Collector, however, rejected the application and proceeded to decide the issue himself.
Petitioners Challenge Collector's Jurisdiction
Before the High Court, the petitioners argued that the Collector had acted wholly without jurisdiction. It was contended that once a dispute regarding entitlement or apportionment of compensation had been raised, Sections 76 and 77 of the 2013 Act required the Collector to make a reference to the competent authority. According to the petitioners, the Collector possessed no adjudicatory powers to finally determine disputed civil rights between rival claimants.
The State authorities and GMADA defended the impugned order and pointed out that a subsequent speaking order had reiterated the earlier decision while directing issuance of a Letter of Intent in favour of the legal heir subject to an indemnity bond. Respondent No.5 further argued that the petitioners had no subsisting right in the property and that an agreement to sell does not create any title or interest in immovable property.
High Court's Findings
The Court framed the central question as whether the Land Acquisition Collector could himself adjudicate disputed claims relating to entitlement and apportionment of compensation or whether he was obligated to refer such disputes to the competent authority.
Referring to precedents of the Supreme Court, Gujarat High Court, Andhra Pradesh High Court and earlier decisions of the Punjab & Haryana High Court, the Bench reiterated that provisions governing references under the 2013 Act are intended precisely for situations where rival claims arise regarding compensation. The Collector's role is limited and does not extend to finally deciding disputed civil rights.
The Court observed that a serious and bona fide dispute undeniably existed between the parties. It noted that the agreements to sell had earlier been protected by a judicial order and that although the petitioners' suit for specific performance had initially been rejected under Order VII Rule 11 CPC, the appellate court had subsequently restored the suit and directed the trial court to proceed with the matter. Therefore, the very basis on which the Collector had rejected the application ceased to survive.
Rejecting the contention that the petitioners had no legally enforceable claim, the Court clarified that the existence of a substantial dispute itself was sufficient to trigger the statutory mechanism of reference. Whether the petitioners ultimately succeed on merits is a matter to be decided by the competent authority and not by the Collector.
Collector Directed To Make Reference
Allowing the petition in part, the High Court set aside the Collector's order dated 04.02.2026 and remitted the matter back with directions to make an appropriate reference under the 2013 Act to the competent authority within four weeks. The Court also quashed consequential orders arising from the Collector's decision.
Importantly, the Bench clarified that it had not expressed any opinion on the merits of the rival claims, including the validity or enforceability of the agreements to sell, entitlement to compensation, legality of the Letters of Intent issued under the Land Pooling Scheme or the effect of earlier proceedings. All such issues were left open for determination by the competent authority in accordance with law.
Significance Of The Judgment
The ruling reinforces an important procedural safeguard under the Land Acquisition Act, 2013. The judgment makes it clear that whenever a bona fide dispute exists regarding entitlement to compensation, rehabilitation benefits or apportionment of acquired land benefits, the Land Acquisition Collector cannot decide the matter himself. Instead, the dispute must be referred to the designated authority for adjudication. The decision is likely to be relied upon in future acquisition disputes involving competing claims to compensation and benefits under land pooling schemes.