Context

Protecting the rights of village landowners in Haryana, the Supreme Court allowed a review of a 2022 judgment which allowed gram panchayats to acquire shamlat deh land.

Supreme Court allows a review of its 2022 Judgment on Shamlat Deh Land Rights

• Background: The apex court in 2022 upheld a 1992 amendment to the Punjab Village Common Lands (Regulation) Act, 1961 (henceforth, the Punjab Act) which allows gram panchayats to manage and control shamlat deh land as “lands reserved for the common purposes of a village”.
• Challenge to 1992 Amendment: The 1992 amendment was recently challenged after observing that the 2022 decision disregarded an important and relevant Constitution Bench decision in the case of Bhagat Ram vs State of Punjab (1967).

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Background of the Dispute and Apex Court’s Judgments

• Bhagat Ram vs State of Punjab (1967): Clarifying the meaning of land acquisition under Article 31A: 
• • Validity of Land Consolidation Scheme: In 1967, a five-judge Bench decided the validity of a land consolidation scheme for the village of Dolike Sunderpur, which proposed to reserve lands “for common purposes” and divert the income of these lands to the panchayat.
    • The state of Punjab argued that reserving lands for the income of the panchayat does not qualify as land acquisition as the income would be used to benefit the village community.
    • It also argued that even if the land was being acquired, this was done before Article 31A came into force through the 17th constitutional amendment of 1964, and thus, the second provison would not apply.

• • Challenge to Scheme: Landowners challenged the scheme arguing that it violates the second provision of Article 31A.Ruling by SC: The SC applied the logic of  Ajit Singh v State of Punjab (1967) in Bhagat Ram Case and held that the beneficiary of the land consolidation scheme was the panchayat, and thus, also the state. 
    • The court held that the panchayat was effectively acquiring the land by reserving its income. 
    • The panchayat’s income can only be used for the village community’s benefit. 
    • Thus, accepting the state’s argument would “defeat the object” of the second provision of Article 31A.
    • Possession and control of the land was not transferred as the scheme had been stayed by the Punjab & Haryana High Court. 
    • Under Section 24 of the East Punjab Holdings (Consolidation and Prevention of Fragmentation) Act, 1948 (henceforth, the Consolidation Act), the scheme will only be “deemed to have come into force” after the possession is transferred.
• Jai Singh vs State of Haryana(2003): Does shamlat land belong to the landowners or the Panchayat:
  • Challenge to Punjab Act: The Punjab & Haryana High Court challenged the 1992 amendment to the Punjab Act which vested control of shamlat deh land in Haryana with the gram panchayat. 
  • Distinction Between Reserved Land and Proprietors’ Contributed Land: The court differentiated between land reserved for common purposes under the Consolidation Act, and land contributed by individual “proprietors”.
  • Exclusion of Control Over Contributed Lands: The control over lands contributed but not included in the consolidation scheme referred to as bachat or surplus land could not be vested with the panchayat as part of the consolidation scheme.
    • Relying on the SC’s decision in Bhagat Ram, the HC  held that the state and the gram panchayat could not acquire land that is not reserved under the consolidation scheme without providing compensation.
  • Challenge to Ruling: The state of Haryana challenged this decision at the Supreme Court which overruled the 2003 decision.
  • Ruling  by SC: It held that there was no need to pay compensation because the amendment to the Punjab Act was enacted after Article 31 had been removed by the Forty-Fourth Constitutional Amendment.
    • The management and control of the land were vested in the panchayat as soon as it was assigned, serving as the initial step before executing the consolidation scheme, and could be utilized at any time. 
    • The requirement in the second provision of Article 31A did not apply, as the panchayat was merely managing the land on behalf of the landholders, not acquiring it.
• Karnail Singh vs State of Haryana (2024): SC allows review of 2022 judgment:

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• Conflict Between 2022 Decision and Constitution Bench’s Ruling in Bhagat Ram: It held that the 2022 decision, which vested control of the land in the panchayat once the land was assigned, was “totally contrary” to the Constitution Bench’s decision in Bhagat Ram. 
  • The Bhagat Ram judgment stated that “management and control do not vest in the Panchayat until possession has changed,” and that landholders retain rights over their holdings until that time.
• Threshold for Review: It held that a smaller bench ignoring a Constitution Bench decision was a “material error manifest on the face of the order”, which is the threshold for permitting a review of a Supreme Court judgment. 
  • Consequently, the Bench recalled the 2022 decision and directed the challenge to the 2003 High Court decision to be heard once again.