Bombay High Court Allows Petition for Rental Compensation in Land Acquisition Case. Petitioner entitled to rental compensation from date of possession till award under Land Acquisition Act, 1894 for land taken for octroi post.

High Court: Bombay High Court Bench: BOMBAY In Favour of Accused

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2026-05-18 19:35:59

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Case Note & Summary

The petitioner, M/s. Devi Construction LLP, owned lands in survey Nos.10 (part), 11 (part) and 160 (part) of Village Wakad, Taluka Mulshi, Dist. Pune, which were included within the limits of Pimpri Chinchwad Municipal Corporation (PCMC). In 1997 and 2000, PCMC published draft development plans reserving the petitioner's land for an octroi post. In 2003, PCMC allegedly encroached upon the land and started using it for the octroi post without initiating acquisition proceedings. On 24th February 2006, an agreement/possession receipt was executed between the petitioner and PCMC for handing over 4849.80 sq. mtrs. for the octroi post and 1379 sq. mtrs. for a 12-meter road, recording that the petitioner agreed on condition of payment of damages. Subsequently, acquisition proceedings were initiated and an award was passed determining compensation. The petitioner filed a writ petition seeking a direction for payment of rental compensation from the date of possession (2003) till the date of the award, as per the State's policy manifested in various Government Resolutions. The court considered the issue and held that the petitioner is entitled to rental compensation for the period between taking possession and payment of compensation under the Land Acquisition Act, 1894. The court directed the respondents to compute the rental compensation in accordance with the applicable Government Resolutions and pay the same to the petitioner within three months.

Headnote

A) Land Acquisition - Rental Compensation - Possession Before Acquisition - Land Acquisition Act, 1894 - Petitioner's land was taken possession by PCMC in 2003 for octroi post without acquisition; formal agreement executed in 2006; acquisition award passed later. Court held that petitioner is entitled to rental compensation from the date of possession till the date of award as per Government Resolutions, and directed respondents to compute and pay the same within three months. (Paras 1-10)

Issue of Consideration

Whether the petitioner is entitled to rental compensation for the period between taking possession of land and payment of compensation under the Land Acquisition Act, 1894, as per the State's policy.

Final Decision

The court allowed the writ petition and directed the respondents to compute and pay rental compensation to the petitioner from the date of possession till the date of the award, in accordance with the applicable Government Resolutions, within three months.

Law Points

Rental compensation
Possession before acquisition
Land Acquisition Act
1894
Government policy
Octroi post

Case Details

2026:BHC-AS:16176-DB

WRIT PETITION NO. 1397 OF 2017

2026-04-06

Manish Pitale, Shreeram V. Shirsat

2026:BHC-AS:16176-DB

Mr. Rompal Singh Kohli a/w Ms. Sejal i/by Ms. C. K. Legal for the Petitioner, Mrs. Pooja Patil, AGP for Respondent Nos.1 and 5 to 7-State, Mr. G. H. Keluskar for Respondent Nos.2 to 4

M/s. Devi Construction LLP

The State of Maharashtra & Ors.

Nature of Litigation

Writ petition seeking direction for payment of rental compensation for land taken possession before acquisition.

Remedy Sought

Direction against respondents for payment of rental compensation as per State policy.

Filing Reason

Respondents took possession of petitioner's land for octroi post in 2003 without acquisition; compensation paid later; rental compensation claimed for interim period.

Issues

Whether the petitioner is entitled to rental compensation for the period between taking possession and payment of compensation under the Land Acquisition Act, 1894.

Submissions/Arguments

Petitioner argued that respondents took possession in 2003 without acquisition and used land for octroi post; rental compensation is due as per Government Resolutions. Respondents contended that possession was taken only in 2006 under agreement and that rental compensation is not payable.

Ratio Decidendi

A person whose land is taken possession before acquisition is entitled to rental compensation for the period between possession and payment of compensation, as per the State's policy.

Judgment Excerpts

The petitioner has approached this Court seeking a direction against the respondents for payment of rental compensation as per the policy of the State. It is the case of the petitioner that while the respondents took possession of the subject land belonging to the petitioner, for establishing an octroi naka or octroi post, the process of acquisition of land and payment of compensation was undertaken much later.

Procedural History

The petitioner filed Writ Petition No. 1397 of 2017 in the High Court of Judicature at Bombay seeking rental compensation. The court reserved judgment on 17th February 2026 and pronounced on 6th April 2026.