JDA vs Sai Darshan Hotels (2026): Rajasthan HC Upholds 15% Developed Land in Lieu of Compensation

The Rajasthan High Court, Jaipur Bench, in D.B. Civil Special Appeal (Writ) No. 658/2010 decided a significant dispute concerning land acquisition compensation and the right to allotment of developed land in lieu of such compensation. The case arose from acquisition proceedings initiated in 1969 for land situated in Village Chainpura, Sanganer, Jaipur, culminating in an award dated 09.04.1981 granting monetary compensation to the original khatedars. Although the amount was determined and even deposited, it was never actually paid to the landowners, and possession of the land was taken over by the Jaipur Development Authority (JDA) in 1983.

Over the years, multiple challenges to the acquisition proceedings were made by the original khatedars and subsequent stakeholders, all of which were dismissed up to the level of the Supreme Court. Thereafter, the respondent company, having acquired rights from earlier landholders, applied to the State Government in 2003 seeking allotment of 15% developed land in lieu of compensation under the prevailing State policy. This policy, particularly the circular dated 13.12.2001 (as amended in 2002), permitted such allotment subject to surrender of rights and withdrawal of litigation. Acting upon this, the respondent withdrew all pending cases, including proceedings before the Supreme Court, and complied with the conditions stipulated by the State.

Pursuant to the policy, the State Government issued orders dated 12.05.2003 and 19.05.2003 directing allotment of Plot No. 7 admeasuring 9000 square meters at Airport Plaza, Jaipur, to the respondent. However, these orders were subsequently kept in abeyance by an order dated 23.06.2009, which led to the filing of a writ petition. The learned Single Judge allowed the petition and quashed the abeyance order, holding that the State was bound by the principle of promissory estoppel since the respondent had already acted upon the assurance by withdrawing litigation.

In appeal, the JDA contended that the respondent had no valid claim to such allotment, alleging irregularities and asserting that the land had already been acquired and possession taken, leaving no scope for further benefits. It was also argued that the allotment caused financial loss to JDA and was based on improper actions by State authorities. However, the Division Bench, after examining the entire record and affidavits, found that neither the original compensation nor the enhanced compensation awarded by the Reference Court in 1990 had been paid or properly deposited. The Court relied on the Supreme Court judgment in Indore Development Authority v. Manoharlal to reiterate that mere deposit of compensation does not amount to payment, and therefore, the right to compensation survives.

The Court further held that the respondent, as an assignee of the original khatedars, was entitled to claim compensation in accordance with the State policy. Since the respondent had fulfilled all conditions, including withdrawal of litigation, the State Government was bound to honour its promise. The action of keeping the allotment order in abeyance was found to be arbitrary, amounting to giving with one hand and taking away with the other, which is impermissible in law. The Court also observed that the policy providing 15% developed land had already been upheld by the Supreme Court and was binding on the authorities, including JDA.

Rejecting the objections raised by JDA, the Court held that the allotment orders had attained finality and could not be questioned on vague allegations. It was further clarified that earlier proceedings did not attract the doctrine of merger or res judicata, as observed by the Supreme Court, and therefore the matter could be examined independently on merits. Ultimately, the Division Bench found no illegality in the order of the learned Single Judge and upheld the respondent’s entitlement to 15% developed land.

Accordingly, the Special Appeal filed by JDA was dismissed, and the Court directed JDA to implement the State Government’s orders dated 12.05.2003 and 19.05.2003 by allotting Plot No. 7 admeasuring 9000 square meters at Airport Plaza, Jaipur, to the respondent. The judgment reinforces the principles that non-payment of compensation preserves the right of landowners, that government policies must be implemented fairly, and that the doctrine of promissory estoppel applies when a party has altered its position based on governmental assurances.

Bhuvnesh Kumar Goyal
Advocate in Jaipur