Delhi Development Authority v. Tejpal & Ors.

Judgment / Order of the Supreme Court Judgment Surya Kant, J. Table of contents*

A. Facts 64 B. Contentions of parties 72 C. Law on Condonation of Delay 78 D. Whether delay should be condoned in the present cases? 82 D.1. Suppression of facts by the landowners 82 D.2. Change of law 85 D.3. Leeway to be granted to government entities 91 D.4. COVID-19 Pandemic 94 D.5. Supreme Court frowning upon the filing of fresh SLPs 97 D.6. Public interest and justice 98 D.7. Delay already condoned in some cases 102 E. Conclusion and Directions 104 Appendix 114 List A: Suppression of facts 116 List B: Notice neither on delay nor on merits 120 List C: Review Petitions and Miscellaneous Applications 129 List D: Leave granted in previous SLP 131 List E: Leave not granted in previous SLP 134

* Ed. Note: Pagination as per the original Judgment.

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For the reasons assigned in Part E of this Judgement, we grant leave in all these Special Leave Petitions, except those mentioned in ‘List-B’, ‘List-D.2’ and ‘List-E.1’ (infra).

2. These appeals have been preferred by the Delhi Development Authority (DDA), Government of National Capital of Delhi (GNCTD), Land Acquisition Collector (LAC), Delhi State Industrial and Infrastructure Development Corporation (DSIIDC), East Delhi Municipal Corporation, and Delhi Metro Rail Corporation Ltd. (DMRC) (collectively, the “appellants”), against various identical orders of the High Court of Delhi, whereby acquisition proceedings had been declared to have lapsed in terms of Section 24(2) of the Right to Fair Compensation and Transparency in Land Acquisition Rehabilitation and Resettlement Act, 2013 (hereinafter, the “2013 Act”). Multiple Review Petitions and Miscellaneous Applications have also been moved by the DDA seeking recall and review of certain orders of this Court dismissing their SLPs, whereby some of the land acquisition proceedings were declared to have lapsed.

3. While the factual matrix giving rise to the present controversy has been elaborated in a judgement of the even date passed by us in the matter of GNCTD (through Secretary, Land and Building Dept.) v. KL Rathi Steels Ltd.,1 a very brief overview of the relevant facts has been set out below. A. Facts 3.1. The GNCTD initiated the land acquisition process under the Land Acquisition Act, 1894 (hereinafter, “1894 Act”) for the planned development of Delhi. The beneficiaries of such acquisition process were various state entities such as DDA, DSIIDC, and DMRC, who needed the lands for different projects like residential schemes, industrial areas, flyovers, the Delhi Metro, etc. Accordingly, over a long span of 1957-2006, various notifications under Sections 4 and 6 of the 1894 Act were issued for acquiring these lands and awards were passed under Section 11 of the 1894 Act affixing compensation. 3.2. In some cases, the compensation amount was deposited in the treasury since the landowners did not come forward to

1 MA No. 414/2023.

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receive the same. Similarly, possession could not be taken in some cases as the affected landowners had challenged the acquisition proceedings and had obtained an order of stay in their favour. 3.3. In the meanwhile, the 2013 Act was enacted by the Parliament, thereby repealing the 1894 Act. This new legislation brought about various reforms to the land acquisition process. Importantly, Section 24 of the 2013 Act provided that land acquisition proceedings initiated under the earlier regime would be deemed to have lapsed in certain cases, including when compensation had not been paid or possession had not been taken. The provision reads as follows: “(1) Notwithstanding anything contained in this Act, in any case of land acquisition proceedings initiated under the Land Acquisition Act, 1894 (1 of 1894),— (a) where no award under Section 11 of the said Land Acquisition Act has been made, then, all provisions of this Act relating to the determination of compensation shall apply; or (b) where an award under said Section 11 has been made, then such proceedings shall continue under the provisions of the said Land Acquisition Act, as if the said Act has not been repealed. (2) Notwithstanding anything contained in sub-section (1), in case of land acquisition proceedings initiated under the Land Acquisition Act, 1894, where an award under the said Section 11 has been made five years or more prior to the commencement of this Act but the physical possession of the land has not been taken or the compensation has not been paid the said proceedings shall be deemed to have lapsed and the appropriate Government, if it so chooses, shall initiate the proceedings of such land acquisition afresh in accordance with the provisions of this Act. Provided that where an award has been made and compensation in respect of a majority of land

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holdings has not been deposited in the account of the beneficiaries, then, all beneficiaries specified in the notification for acquisition under Section 4 of the said Land Acquisition Act, shall be entitled to compensation in accordance with the provisions of this Act” [emphasis supplied] 3.4. One of the first cases interpreting Section 24(2) of the 2013 Act was Pune Municipal Corporation v. Harak Chand Mistrimal Solanki,2 in which a three-judge bench of this Court held that offering payment to the landowner and depositing it with the Reference Court in case of certain contingencies under Section 31(2) of the 1894 Act, would fulfil the requirement of the compensation being “paid”.3 Accordingly, depositing compensation with the Government Treasury was held to not constitute payment of compensation for purposes of Section 24(2) of the 2013 Act and such land acquisition proceedings were held to have lapsed. 3.5. In a subsequent judgment of Sree Balaji Nagar Residential Association v. State of Tamil Nadu,4 a two-judge bench of this Court further elucidated the concept of taking possession by holding that the period during which an order of stay is in operation is not excluded by Section 24(2) of the 2013 Act. Consequently, this Court held that an operation of stay would not ameliorate a failure to take possession and that such acquisition proceedings would be deemed to have lapsed. 3.6. Relying on these two decisions, the present respondent- landowners approached the High Court from 2014 to 2017 seeking declaration(s) that the acquisition proceedings initiated by GNCTD had lapsed because of non-payment of compensation or non-taking of possession. Following the dictum in Pune Municipal Corporation (supra) and Sree Balaji Nagar Residential Association (supra), the High Court allowed the landowners’ claim and declared the acquisition proceedings as

2 [2014] 1 SCR 783 : (2014) 3 SCC 183, para 17. 3 The contingencies being, when landowners do not give consent to receive compensation, there is no person competent to alienate the land, or there is dispute regarding title to receive the compensation. 4 [2014] 7 SCR 799 : (2015) 3 SCC 353, para 11.

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lapsed. The appellants preferred SLPs against some of these orders, many of which were in turn dismissed by this Court either in limine or after granting leave. 3.7. However, a two-judge bench of this Court in Yogesh Neema v. State of Madhya Pradesh 5 doubted the correctness of Sree Balaji Nagar Residential Association (supra). Relying upon the maxim “actus curiae neminem gravabit” (i.e., the act of court should not prejudice the parties), the bench referred for reconsideration the question of law regarding the effect of an order of stay on possession under Section 24(2) of the 2013 Act to a larger bench. 3.8. Similarly, another two-judge bench of this Court in Indore Development Authority v. Shailendra 6 doubted the correctness of Pune Municipal Corporation (supra) and referred the question of law regarding the manner of payment under Section 24(2) of the 2013 Act for reconsideration. 3.9. Both these issues were considered by a three-judge bench of this Court in Indore Development Authority v. Shailendra.7 The larger bench held, inter alia, that the term “paid” in Section 24(2) of the 2013 Act is to be read as “tender” of payment, i.e., an offer to pay. In case the compensation was tendered and the same was refused, it was to be interpreted as “paid”. Further, on account of various rules made under Section 55 of the 1894 Act, it was held that the term “deposit” in the proviso to Section 24(2) of the 2013 Act must be read to include a deposit of compensation with the Government Treasury, and not just with the Reference Court. The three-judge bench then held that Pune Municipal Corporation (supra) was per incuriam as it failed to consider the statutory rules made under Section 55 of the 1894 Act and as it also did not take notice of appropriate precedents for interpreting the term “paid”. Sree Balaji Nagar Residential Association (supra) was also overruled in so far as it allowed landowners to unduly benefit from orders of stay.

5 (2016) 6 SCC 387, para 6-7. 6 (2018) 1 SCC 733, para 23. 7 [2018] 2 SCR 1 : (2018) 3 SCC 412, para 216-217.

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3.10. It is in the aftermath of Shailendra (supra) that the appellants filed most of the present appeals, Review Petitions and Miscellaneous Applications seeking a favourable determination of their rights. 3.11. Meanwhile, in State of Haryana v. GD Goenka Tourism Corporation Ltd.,8 it was argued that since Pune Municipal Corporation (supra) and Shailendra (supra) were decided by a bench of equal strength, the matter should be referred to a larger bench. This Court deferred the hearing to a later date and held that pending a final decision on referring the matter to a larger Bench, the High Courts shall not deal with any case relating to the interpretation of Section 24 of the 2013 Act. Subsequently, two different benches of this Court issued even date orders on 22.02.2018 in Indore Development Authority v. Shyam Verma9 and State of Haryana v. Maharana Pratap Charitable Trust (Regd.),10 referring the matter to a larger bench. 3.12. Eventually, a five-judge bench decided these questions of law in Indore Development Authority v. Manoharlal 11 and held, inter alia, that the term “or” in Section 24(2) of the 2013 Act shall be read as “and”, such that for land acquisition proceedings to lapse under this Section, neither the compensation must have been paid nor the possession must have been taken. With respect to payment of compensation, it was held that the term “paid” means tendering of payment and the term “deposit” in Section 24 of the 2013 Act includes deposit both with the government treasury and the Reference Court. Hence, land acquisition proceedings cannot be deemed to have lapsed if compensation was tendered to the landowner and later deposited in the Treasury. With respect to possession, the Constitution Bench held that the period of stay granted in favour of landowners ought to be excluded. Consequently, Pune Municipal Corporation (supra) and Sree Balaji

8 (2018) 3 SCC 585, para 9. 9 (2020) 15 SCC 342, para 3. 10 (2018) SCC Online SC 3600, para 1. 11 [2020] 3 SCR 1 : (2020) 8 SCC 129, para 366.

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Nagar Residential Association (supra) were overruled. This Court also overruled Shailendra (supra), since the question of reading the conditions under Section 24(2) conjunctively (i.e., reading “or” as ‘and’) was not considered by that case. Subsequently, in light of the decision in Manoharlal (supra), the judgment in Pune Municipal Corporation (supra) was recalled. 3.13. After the dust stood settled finally in Manoharlal (supra), the appellants filed another batch of appeals against such orders of the High Court of Delhi which had relied on Pune Municipal Corporation (supra) and Sree Balaji Nagar Residential Association (supra) to declare the acquisition proceedings as having lapsed. Similarly, Review Petitions and Miscellaneous Applications were filed against the orders of this Court dismissing the SLPs filed previously. 3.14. To simplify, the present batch of matters before us can broadly be classified into the following three categories: (a) First, cases filed before Shailendra (supra). Most of the SLPs in this category were dismissed by this Court after granting leave, on the strength of Pune Municipal Corporation (supra) and Sree Balaji Nagar Residential Association (supra), but a few were deferred to a later date and are still pending; (b) Second, cases filed after Shailendra (supra), on the ground that Sree Balaji Nagar Residential Association (supra) has been overruled and Pune Municipal Corporation (supra) has been held to be per incuriam; and (c) Third, cases filed after Manoharlal (supra) which overruled both Pune Municipal Corporation (supra) and Sree Balaji Nagar Residential Association (supra), with a plea that the High Court decisions deserve to be revisited given the principles enunciated in Manoharlal (supra). 3.15. We note that a factor common to most of the matters mentioned in paragraph 3.14 above is that they were filed after the expiration of the period of limitation. The quantum of delay differs in each case, and while it is less in the cases filed in

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the first category, it is significantly long in the second and third categories. Hence, at this stage, it is important to first examine at length the prayer for condonation of delay and the maintainability of these petitions, before delving into the merits of each case. B. Contentions of parties

4. The appellants were represented by Ld. Attorney General for India, Ms. Aishwarya Bhati, Ld. Additional Solicitor General, and Senior Advocates, including Ms. Rachna Srivastava, Mr. Sanjay Poddar, Mr. Sanjib Sen, and Mr. Kailash Vasdev. From the side of Respondents, we were assisted by an array of Senior Advocates, including Mr. Dhruv Mehta, Mr. Gopal Sankaranarayanan, Mr. Jayant Bhushan, Mr. Jayant Mehta, Ms. Vibha Datta Makhija, and Mr. Vikas Singh, and Ms. Bansuri Swaraj, Advocate.

5. The appellants argued that they had sufficient cause for not filing the appeals and applications within the prescribed time. Substantiating this, they made the following submissions: (a) The respondent-landowners had suppressed certain material facts from the High Court. Once the appellants discovered these fraudulent claims, they filed the present appeals. In Commissioner of Customs v. Candid Enterprises,12 this Court held that fraud vitiates the delay that occurred before its discovery. The discovery of the facts suppressed by the respondents before the High Court, gives rise to a fresh cause of action and, hence the period preceding the revelation of such fraud deserves to be excluded while calculating the limitation period. (b) The appellants were disabled from filing appeals within the prescribed limitation period because the governing law during such period as laid down in Pune Municipal Corporation (supra) and Sree Balaji Nagar Residential Association (supra), would have caused the dismissal of their petitions. Since the question of law was finally decided in their favour in Shailendra (supra) and Manoharlal (supra), their cause of action stood revived to enable them to approach this Court. Further, a case is applied retrospectively unless the judgment

12 (2002) 9 SCC 764, para 6.

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expressly recites otherwise, as held in CIT v. Saurashtra Kutch Stock Exchange Ltd.13 Since Manoharlal (supra) did not restrict its applicability prospectively, all the cases decided before thereto deserve to be re-decided based on the principles enunciated in it. (c) The Court should take a liberal approach regarding condonation of delay and allow leeway to the government authorities, who, on account of their impersonal character, multiple chains of approval, processing of a large number of files, and lack of resources, unintentionally cross the prescribed limitation timeline and suffer bureaucratic delay. (d) The delay caused by the COVID-19 pandemic deserves to be condoned as the restrictions on movement during the lockdown, defuncted the appellants who did not have a well-equipped technological infrastructure in place to meet such unexpected and newer challenges. The appellants in this regard placed reliance on various decisions of this Court including Collector (LA), Anantnag v. Katiji,14 G. Ramegowda v. Spl. Land Acquisition Officer,15 State of Manipur v. Koting Lamkang,16 and Sheo Raj Singh v. Union of India.17 (e) The appellants could not file the appeals on time because the Court was frowning upon the filing of multiple fresh SLPs despite the law having been settled in Pune Municipal Corporation (supra), and was imposing costs while dismissing such SLPs. (f) In various cases such as Imrat Lal v. LAC,18 this Court has held that delay can be condoned in the interest of justice. In the present case also, the Court should condone the delay in public interest and subserve the cause of justice as the acquisition proceedings were undertaken for projects of eminent public importance like the expansion of the metro, construction of flyovers, hospitals, etc.

13 [2008] 13 SCR 421 : (2008) 14 SCC 171, para 35. 14 [1987] 2 SCR 387 : (1987) 2 SCC 107, para 3. 15 [1988] 3 SCR 198 : (1988) 2 SCC 142, para 17. 16 [2019] 13 SCR 565 : (2019) 10 SCC 408, para 8. 17 [2023] 13 SCR 743 : 2023 SCC OnLine SC 1278, para 11. 18 (2014) 14 SCC 133, para 11.

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6. Per contra, the respondent-land owners vociferously argued that the appellants have failed to showcase sufficient cause in filing the appeals and applications with enormous delay and that: (a) It is false to claim that the landowners had suppressed material facts during the proceedings in the High Court. Alternatively, even if some of the landowners did suppress the facts, these were only a handful of instances that could not be used for condoning delay in all the appeals and applications. (b) Delay cannot be condoned based on subsequent change of law. If it were to be allowed as a legitimate ground for condonation of delay, no proceedings would ever reach finality because cases could be re-opened whenever a question of law were to be interpreted differently. Further, Shailendra (supra) and Manoharlal (supra) could not be applied retrospectively, since overruling of cases relying on Pune Municipal Corporation (supra) and Sree Balaji Nagar Residential Association (supra) took away only their precedential effect and did not re- open the lis between the parties in those cases. The respondents have in this regard relied upon various decisions of this Court including Neelima Srivastava v. State of UP19 and Natural Resources Allocation, In re, Special Reference 1 of 2012.20 (c) There should be parity between private parties and government entities with respect to the yardstick to be applied for condonation of delay and no leeway should be granted to the latter (relied on, inter alia, Postmaster General v. Living Media India Ltd)21. (d) This Court has made it clear in Sagufa Ahmed v. Upper Assam Plywood Products (P) Ltd.,22 that the relaxation on account of COVID-19 can be granted only in those cases where the limitation period expired during COVID-19. Such relaxation would not be available in the present case as the period of limitation for filing the appeals had expired much before the pandemic.

19 [2021] 8 SCR 167 : 2021 SCC Online SC 610, para 29. 20 [2012] 9 SCR 311 : (2012) 10 SCC 1, para 48. 21 [2012] 1 SCR 1045 : (2012) 3 SCC 563, para 28. 22 [2020] 9 SCR 472 : (2021) 2 SCC 317, para 17.

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(e) Delay cannot be condoned on the grounds of the Court frowning upon the filing of fresh SLPs as no sufficient material to substantiate such a plea has been placed on record. (f) The grounds of public interest or cause of justice cannot be invoked to condone the delay, for even if the law of limitation produces a harsh outcome, it ought to be followed. The respondents have buttressed this plea by citing Pundlik Jalam Patil v. Executive Engineer, Jalgaon Medium Project,23 in which this Court held that delay cannot be condoned solely on the ground of public interest and to do justice because third- party rights may have been created during the prolonged delay and it would be unfair for such parties if the delay is condoned and the settled position is reversed. C. Law on Condonation of Delay

7. Since the issue in this batch of appeals concerns the condonation of delay, it would be worthwhile to briefly allude to the law of limitation. The Limitation Act, 1963 (“Limitation Act”) is a statute of repose founded on considerations of public policy and expediency. The dominant objective underlying the law of limitation is that the title to property, and matters of rights in general, cannot be kept in a state of constant uncertainty, doubt or suspense. Public interest requires that finality should be put to litigation. The Limitation Act, thus, prescribes the specific points of time from which the period of limitation begins to run for the institution of actions. On expiry of such period, no action can be initiated save and except where the court condones the delay for a sufficient cause. A party who is insensible to the value of civil remedies, and who does not assert his claim with promptitude is denied the ability to enforce even an otherwise rightful claim. This position is reflected in the Latin maxim, vigilantibus et non dormientibus jura subveniunt, i.e., the law aids the vigilant and not those who sleep on their rights.

8. The Bombay High Court in Kumudini Ramdas Shah v. K.M. Mody24 aptly exposited the philosophical pillars supporting the concept of limitation: (i) the sword of prosecution ought not to be hanging over an individual for an indeterminate period; (ii) those who have been

23 [2008] 15 SCR 135 : (2008) 17 SCC 448, para 30. 24 Kumudini Ramdas Shah v. K.M. Mody & Ors., AIR 1985 Bombay 320, para 4.

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lethargic in safeguarding their interests should not expect the law to come to their rescue; and (iii) a defendant ought not to suffer for lost evidence owing to the passage of time.

9. Section 3 of the Limitation Act reflects this philosophy. Every suit or appeal made after the period of limitation ought to be dismissed, notwithstanding whether such ground had been raised by the opposite side. However, this does not imply that the Limitation Act destroys the right itself. Instead, it only extinguishes the ability to enforce the right, without either creating or destroying the underlying cause of action or entitlement itself.

10. As is clear from a plain reading of Section 5 of the Limitation Act, there are exceptions to this general rule. The statute allows for admitting an action provided “sufficient cause” is shown. This vests courts with the discretion to extend the period of limitation if the applicant can show that he had sufficient cause for not preferring an appeal or application within the prescribed period. Section 5 requires analysis of two ingredients: first, an examination of whether “sufficient cause” has been made out; and second, whether such cause has been shown for not filing the appeal/application “within the prescribed period”.

11. As regards the first ingredient, the Limitation Act itself does not provide more guidance on what its constituent elements ought to be. Instead, Section 5 leaves the task of determining appropriate reasons for seeking condonation of delay to judicial interpretation and exercise of discretion upon the facts and individual circumstances of each case.

12. While there is no arithmetical formula, through decades of judicial application, certain yardsticks for judging the sufficiency of cause for condonation of delay have evolved. Mere good cause is not sufficient enough to turn back the clock and allow resuscitation of a claim otherwise barred by delay. The court ought to be cautious while undertaking such an exercise, being circumspect against condoning delay which is attributable to the applicant.25 Although the actual period of delay might be instructive, it is the explanation for the delay which would be the decisive factor.26

25 Basawaraj v. Land Acquisition Officer (2013) 14 SCC 81, para 9-11. 26 Perumon Bhagvathy Devaswom v. Bhargavi Amma (2008) 8 SCC 321, para 13.

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13. The court must also desist from throwing the baby out with the bathwater. A justice-oriented approach must be prioritized over technicalities,27 as one motivation underlying such rules is to prevent parties from using dilatory tactics or abusing the judicial process. Pragmatism over pedanticism is therefore sometimes necessary – despite it appearing liberal or magnanimous. The expression ‘sufficient cause’ should be given liberal construction so as to advance substantial justice.28

14. In addition to “sufficient cause”, Section 5 also requires that such cause must be shown within the prescribed period. To satisfy the latter condition, the applicant must show sufficient cause for not filing the appeal/application on the last day of the prescribed period and explain the delay made thereafter.29 Causes arising after the culmination of the limitation period, despite being sufficient in substance, would not suffice for condonation given this second prong of Section 5 of the Limitation Act. However, the applicant shall not be required to prove each day’s delay till the date of filing such appeal/application.30

15. With these broad yardsticks in mind, we shall now separately analyze each ground pleaded by the appellants on the anvil of sufficiency. D. Whether delay should be condoned in the present cases? D.1. Suppression of facts by the landowners

16. The appellants argued that the respondent-landowners had suppressed material facts from the High Court, including previous unsuccessful litigations. Acquisitions were in fact already complete in many of these cases, a fact that was deliberately not disclosed. Other respondent-landowners also concealed from the court how they were only subsequent purchasers who had acquired the lands after they had been notified for the acquisition. Similarly, in some cases, the landowners suppressed the fact that the acquired lands had already vested in their respective Gaon Sabhas.

17. In addition to highlighting the factum of suppression, the appellants have also demonstrated materiality. They urged that had these facts

27 Raheem Shah v. Govind Singh, 2023 SCC OnLine SC 910, para 6. 28 Sarpanch, Lonand Gram Panchayat v. Ramgiri Gasavi & Anr., 1967 SCC OnLine SC 105, para 4. 29 Ramlal v. Rewa Coalfields Ltd., 1961 SCC OnLine SC 3, para 8. 30 Ummer v. Pottengal Subida (2018) 15 SCC 127, para 14.

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been disclosed before the High Court, the respondents would have been estopped from seeking the declaration that the acquisition proceedings had lapsed. The appellants have in this regard placed reliance on Meera Sahni v. Lt. Governor of Delhi31 and Section 3 of Delhi Lands (Restrictions on Transfer) Act, 1972, to fortify their contention that no bona fide sale transaction could take place in respect of the lands which were already the subject matter of acquisition process. These concealments, they submitted, amount to playing fraud on both the court and the public exchequer. Accordingly, the time spent in the discovery of such suppressions should be deducted from the overall quantum of delay.

18. In this regard, the appellants have cited Section 17 of the Limitation Act, which provides that: “…the period of limitation shall not begin to run until the plaintiff or applicant has discovered the fraud or the mistake or could, with reasonable diligence, have discovered it, or in the case of a concealed document, until the plaintiff or the applicant first had the means of producing the concealed document or compelling its production.” [emphasis supplied]

19. There can indeed be no quarrel that Section 17 of the Limitation Act is premised on the well-known principle that fraud vitiates the delay and provides a cause of action once discovered.32 The appellants’ contention, however, has to be evaluated keeping in view the stand taken on behalf of the respondent-landowners who have refuted the omnibus allegation of suppression of facts against all of them. We have already noticed in paragraph 6(a) above that according to the respondent-landowners there are only a few cases where the allegation of suppression of material facts merits consideration.

20. We may also hasten to clarify the scope of our enquiry. The respondent-landowners have not been called upon to refute or admit the allegations of concealment of facts attributed to some of them. Similarly, we have not asked the appellants to produce original records and documents to substantiate their allegation of concealment and

31 [2008] 10 SCR 1012 : (2008) 9 SCC 177, para 21. 32 Commissioner of Customs v. Candid Enterprises (2002) 9 SCC 764, para 6.

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suppression of material facts. We are conscious that entering into an arena of factual controversy at such an advanced stage of litigation, and that too without giving adequate opportunities to the parties can be a potential threat to the cause of justice. Simultaneously, we are satisfied that the appellants’ contention in this regard cannot be brushed aside lightly.

21. Without expressing any final definitive opinion on such allegations of concealment, we are of the considered view that the appellants have discharged a prima facie burden for the limited purpose of making out a case for condonation of delay in the cases mentioned in the appended ‘List-A’, which shall be read as a part of this judgment. We believe that a fact-finding exercise is necessary in these cases, and hence, there exist sufficient grounds for the condonation of delay. The nature of relief to be eventually granted after condoning the delay, will be separately dealt with in Part E of this order. D.2. Change of law

22. Another ground taken by appellants for seeking condonation of delay is the subsequent change of law brought in by Shailendra (supra) and Manoharlal (supra). However, we are unable to agree with this contention because of four primary reasons.

23. Firstly, this ground seeks to use events temporally subsequent to the expiry of the limitation period to justify the delay. To revisit Section 5 of the Limitation Act, the text of the statute provides that an appeal or application may be admitted after the prescribed period if the “appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period .” Hence, the appellants are required to explain that they were diligent during the prescribed period of limitation and could not file the appeal because of a “sufficient cause” arising within the prescribed period.

24. This understanding is squarely covered by the case of Ajit Singh Thakur v. State of Gujarat,33 which had an analogous factual situation. The appellants in the cited case were accused of killing one Manilal and injuring Bhulabhai and others and were acquitted by the trial court. Against this, Bhulabhai filed a revision petition

33 [1981] 2 SCR 509 : (1981) 1 SCC 495, para 6.

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before the High Court, which passed certain observations stating that it is a fit case for the State to file an appeal. Consequently, the State filed an appeal and sought condonation of delay. While the High Court allowed it, this Court held that the condonation of delay was improper. The Court held: “6. At the outset, it is urged by learned counsel for the appellants that the High Court erred in condoning the delay in filing the appeal, and the appeal should have been dismissed as barred by limitation. We have examined the facts carefully. It appears that initially the State Government took a decision not to file an appeal and it allowed the period of limitation to lapse. Subsequently, on certain observations made by the High Court while considering a revision petition by Bhulabhai that it was a fit case where the State Government should file an appeal and on notice being issued by the High Court to the State Government in the matter, the appeal was filed. It was filed three months after limitation had expired. A faint attempt was made to show that when the initial decision was taken not to file an appeal all the papers had not been considered by the department concerned, but we are not impressed by that allegation. The truth appears to be that the appeal was not filed at first because the State Government saw no case on the merits for an appeal, and it was filed only because the High Court had observed — and that was long after limitation had expired — that the case was fit for appeal by the State Government. Now, it is true that a party is entitled to wait until the last day of limitation for filing an appeal. But when it allows limitation to expire and pleads sufficient cause for not filing the appeal earlier, the sufficient cause must establish that because of some event or circumstance arising before limitation expired it was not possible to file the appeal within time. No event or circumstance arising after the expiry of limitation can constitute such sufficient cause. There may be events or circumstances subsequent to the expiry of limitation which may further delay the filing of the

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appeal. But that the limitation has been allowed to expire without the appeal being filed must be traced to a cause arising within the period of limitation. In the present case, there was no such cause, and the High Court erred in condoning the delay.” [emphasis supplied]

25. Similarly, in most of these cases, the prescribed period of limitation had already expired long before the judgments in Shailendra (supra) and Manoharlal (supra) were delivered. The appellants let the limitation period lapse, perhaps because they saw no case on merits for appeal. When the law was subsequently re-interpreted in the afore-cited two cases, the appellants approached this Court with the present appeals, petitions, and applications. Instead of showing a sufficient cause arising within the period of limitation, they are using an event after the expiry of such period to justify the delay. This does not square with our understanding of the law, and cannot be allowed.

26. This leads us to the second reason for disagreeing with the ground, which is that a party cannot be allowed to take advantage of its deliberate inaction during the limitation period. Allowing to the contrary would distort incentives for parties and create dystopian consequences for our judicial process. To put this in right perspective, two scenarios can be juxtaposed: one, where the appellants had been vigilant and had preferred an appeal within the limitation period, but would have failed to succeed as the governing law during that time was as stated by Pune Municipal Corporation (supra) and Sree Balaji Nagar Residential Association (supra); and second, where the appellants deliberately allowed the limitation period to expire and have now approached this Court using the subsequent change of law as a ground for allowing the appeals. Now, if the appellants are allowed to file the appeals in the second scenario, it will lead to an anomalous situation where the appellants that were vigilant were not able to get the remedy but the ones that were sleeping over their rights would obtain relief. This would run counter to the purpose of the Limitation Act, which, instead of giving finality to the proceedings, would be permitting the parties to use the delay to their advantage.

27. Thirdly, if subsequent change of law is allowed as a valid ground for condonation of delay, it would open a Pandora’s Box where all the cases that were subsequently overruled, or the cases that had

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relied on the judgements that were subsequently overruled, would approach this Court and would seek a relief based on the new interpretation of law. There would be no finality to the proceedings and every time this Court would reach a different conclusion from its previous case, all such cases and the cases relying on it would be reopened.

28. We find adequate support to our afore-stated reason in Tilokchand & Motichand v. H.B. Munshi,34 in which a 5-Judge Bench of this Court had the occasion to consider the question of condonation of delay on the basis of subsequent change of law. While giving the majority opinion, Hidayatullah, CJ. held: “[…] Everybody is presumed to know the law. It was his duty to have brought the matter before this Court for consideration. In any event, having set the machinery of law in motion he cannot abandon it to resume it after a number of years, because another person more adventurous than he in his turn got the statute declared unconstitutional, and got a favourable decision. If I were to hold otherwise, then the decision of the High Court in any case once adjudicated upon and acquiesced in, may be questioned in a fresh litigation revived only with the argument that the correct position was not known to the petitioner at the time when he abandoned his own litigation. […]” [emphasis supplied]

29. Finally, the fourth reason why subsequent overruling of a judgement cannot be a sufficient cause is because when a case is overruled, it is only its binding nature as a precedent that is taken away and the lis between the parties is still deemed to have been settled by the overruled case.35 It is a settled principle of law that even an erroneous decision operates as res judicata between the parties.36 Hence, when Manoharlal (supra) overruled Pune Municipal Corporation (supra) and Sree Balaji Nagar Residential Association (supra),

34 [1969] 2 SCR 824 : (1969) 1 SCC 110, para 12. 35 Neelima Srivastava v. State of Uttar Pradesh, 2021 SCC Online SC 610, para 30. 36 R. Unnikrishnan v. V.K. Mahanudevan (2014) 4 SCC 434, para 19-23.

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as well as all other cases relying on them, it only overruled their precedential value, and did not reopen the lis between the parties. The mere fact that the impugned orders in the present case were overruled by Manoharlal (supra) would not, therefore, be a sufficient ground to argue that the cases should be reopened.

30. In this respect, it would be pertinent to highlight an exception—cases that are still pending before this Court. If the lis is still pending and has not reached finality, those cases would be decided on the basis of Manoharlal (supra). This is because a decision on the interpretation of law is applied retrospectively unless the court specifically rules as to its prospective applicability.

31. There can, however, be no doubt that a lis will have to be decided as per the new interpretation if during its pendency, the law has been construed in a different manner by a subsequent judgement. We say so for the reason that such new construction shall be deemed to be the correct understanding of the statute from its very inception. We find support in this regard from Shyam Madan Mohan Ruia v. Messer Holdings Ltd.,37 in which the High Court had dismissed the suit based on the decision of this Court in Foreshore Coop. Housing Society Ltd. v. Praveen D. Desai.38 During the pendency of appeal, Foreshore Coop. Housing Society Ltd. (supra) was overruled in the case of Nusli Neville Wadia v. Ivory Properties.39 This Court while deciding the issue in Shyam Mohan Ruia (supra), held that since the precedent forming the very basis of the High Court’s decision stood overruled, the dispute before it must be decided as per the later decision.

32. To sum up, we hold that subsequent change of law will not be attracted unless a case is pending before the competent court awaiting its final adjudication. To say it differently, if a case has already been decided, it cannot be re-opened and re-decided solely on the basis of a new interpretation given to that law. D.3. Leeway to be granted to government entities

33. The appellants have vehemently contended that the government entities ought to be allowed leeway for condonation of delay. For

37 [2019] 15 SCR 396 : (2020) 5 SCC 252, para 18. 38 [2015] 5 SCR 1075 : (2015) 6 SCC 412 39 [2019] 15 SCR 795 : (2020) 6 SCC 557

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this, the appellants placed reliance on Collector (LA) (supra) and G. Ramegowda (supra) which held that courts ought to be generous while considering delay on the part of government entities given factors unique to them like the impersonal nature of their functioning, inherited bureaucratic methodology, and procedural red-tapeism.

34. However, with time, the position of law held in these cases has been diluted. In Commissioner of Wealth Tax v. Amateur Riders Club,40 this Court noted that while latitude can be granted to the government, it has to show its bona fide and diligence in filing the appeals. In case of bureaucratic indifference, delay cannot be condoned.

35. Subsequently, in the case of Postmaster General (supra), this Court noted that the delay cannot be condoned mechanically only because the appellant is a government entity. The Court explicitly negated the earlier rationale of impersonal machinery and inherited bureaucratic methodology given modern improvements in technology. Lastly, the Court held that government entities must show bona fide and demonstrate diligence in pursuing the matter.

36. This Court has again in State of Madhya Pradesh v. Bherulal,41 reiterated the reasoning of the Postmaster General (supra) and held that the Collector (LA) (supra) could not be relied upon any longer as it was laid down in a different bureaucratic and technological period. The proposition that government entities ought to be afforded greater latitude on issues of delay on account of administrative exigencies, is no longer a precedent to be followed routinely.

37. Although the appellants have cited two more decisions of this Court in support of their prayer for condonation of delay, we find both of them distinguishable on facts. In Koting Lamkang (supra) a three- judge bench of this Court, in the peculiar circumstances where certain individual officers had acted with mala fide, chose not to extend the burden of individual recklessness to the State’s institutional interest; as may be seen from the following extract:

40 (1994) Supp. (2) SCC 603, para 3. 41 [2020] 8 SCR 912 : (2020) 10 SCC 654, para 3.

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“8. Regard should be had in similar such circumstances to the impersonal nature of the Government’s functioning where individual officers may fail to act responsibly. This in turn, would result in injustice to the institutional interest of the State. If the appeal filed by the State are lost for individual default, those who are at fault, will not usually be individually affected.” [emphasis supplied]

38. Similarly, in Sheo Raj Singh (supra), the marked distinction was the scope of interference by this Court while exercising judicial review of an order of condoning delay passed by a High Court. This Court distinguished between the two situations, namely: (i) its constraints while sitting in appeal over a discretionary order; and (ii) itself considering an application for condonation of delay. Such a distinction is discernable from the following passage in Sheo Raj Singh (supra): “30. Be that as it may, it is important to bear in mind that we are not hearing an application for condonation of delay but sitting in appeal over a discretionary order of the High Court granting the prayer for condonation of delay. In the case of the former, whether to condone or not would be the only question whereas in the latter, whether there has been proper exercise of discretion in favour of grant of the prayer for condonation would be the question…” [emphasis supplied]

39. It seems to us that acceding to the appellants’ request on the aforesaid account would also have undesirable consequences. If delay were to be condoned merely on the basis of a broad general assertion of bureaucratic indifference, without requiring demonstration of bona fide or an act of mala fide on the part of specific individuals, it would create an artificial distinction between the private parties and the government entities vis-à-vis the law of limitation. This would not be in conformity with the spirit of equality before law as guaranteed under our Constitution. Allowing such latitude would further distort incentives for the government and encourage more laxity by the bureaucracy in its general functioning, thereby undermining quality governance.

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D.4. COVID-19 Pandemic

40. The fourth ground taken by the appellants is that the delay ought to be condoned on account of the COVID-19 pandemic. At this juncture, it would be apposite to discuss the series of orders passed by this Court regarding the operation of limitation vis-à-vis the COVID-19 pandemic.

41. Vide order dt. 23.03.2020 In Re: Cognizance for Extension of Limitation,42 this Court passed an omnibus order extending the period of limitation for proceedings before all courts/tribunals in the country from 15.03.2020 till further orders. Subsequently, vide an order dt. 08.03.2021, this Court noted the lifting of the nation-wide pandemic lockdown and a return to normalcy. Accordingly, the Court brought an end to the extension and held that: “I. In computing the period of limitation for any suit, appeal, application or proceeding, the period from 15.03.2020 till 14.03.2021 shall stand excluded. Consequently, the balance period of limitation remaining as on 15.03.2020, if any, shall become available with effect from 15.03.2021. II. In cases where the limitation would have expired during the period between 15.03.2020 till 14.03.2021, notwithstanding the actual balance period of limitation remaining, all persons shall have a limitation period of 90 days from 15.03.2021. In the event the actual balance period of limitation remaining, with effect from 15.03.2021, is greater than 90 days, that longer period shall apply. III. The period from 15.03.2020 till 14.03.2021 shall also stand excluded in computing the periods prescribed under Sections 23 (4) and 29A of the Arbitration and Conciliation Act, 1996, Section 12A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the

42 (2020) 19 SCC 10, para 2.

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court or tribunal can condone delay) and termination of proceeding […]”. [emphasis supplied]

42. However, when COVID-19 cases across the country rose again, a miscellaneous application was filed and vide an order dt. 27.04.2021,43 this Court restored the order dated 23.03.2020 and held that the period of limitation is to be extended till further orders. This came to an end on 23.09.2021 when directions to exclude the period between 15.03.2020 and 02.10.2021 from limitation were issued.44

43. On account of the third wave of Pandemic, the aforementioned order dated 23.09.2021 was finally modified on 10.01.2022, with a total period of approximately 716 days between 15.03.2020-28.02.2022 being excluded from the operation of limitation.45

44. The respondents submit that the orders of this Court passed by this Court from time to time as referred to above, would not come to the aid of the appellants since these orders saved only those actions and proceedings which were within the period of limitation as on 15.03.2020. They contended that the aforementioned orders ought not to be construed in a manner to resuscitate actions and proceedings that were time-barred before the onset of COVID-19 pandemic. If the limitation period had already expired before the pandemic, such cases could not take shelter behind the general relief granted by this Court in In Re: Cognizance for Extension of Limitation (supra). The respondents buttressed their arguments by relying upon Sagufa Ahmed v. Upper Assam Plywood Products (P) Ltd.46

45. Sagufa Ahmed (supra) construed that the orders passed In Re: Cognizance for Extension of Limitation (supra) were intended to benefit vigilant litigants who were prevented due to the pandemic and the lockdown, from initiating proceedings within the period of limitation prescribed by general or special law. We respectfully agree with the view taken in Sagufa Ahmed (supra). Consequently, the benefit of In Re: Cognizance for Extension of Limitation (supra)

43 2021 SCC Online SC 373, para 6-7. 44 2021 SCC Online SC 947, para 8. 45 (2022) 3 SCC 117, para 5. 46 [2020] 9 SCR 472 : (2021) 2 SCC 317, para 17.

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