Introduction:

The case of State of Uttar Pradesh and Others v. Iftekhar Ahmad and Another (2026 LiveLaw (AB) 229) came before the Allahabad High Court, where an important question regarding the jurisdiction and powers of a Reference Court under the Land Acquisition Act, 1894 was examined. The matter was adjudicated by Justice Sandeep Jain in an appeal challenging an order passed by the Presiding Officer of the Land Acquisition, Rehabilitation and Resettlement Authority, who had acted as a Reference Court and partially set aside the award passed by the Collector. The Reference Court had further remanded the matter back to the Collector for fresh determination of compensation, primarily on the ground that the compensation ought to have been assessed under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 instead of the 1894 Act. The High Court was thus called upon to determine whether such a course of action was permissible within the statutory framework governing land acquisition and whether a Reference Court could exercise powers akin to an appellate authority by setting aside and remanding the Collector’s award.

Arguments on Behalf of the Appellant (State Authorities):

The appellants, representing the State authorities, challenged the legality of the Reference Court’s order on the ground that it had acted beyond the scope of its jurisdiction. It was contended that the Land Acquisition Act, 1894 clearly delineates the powers of the Collector and the Reference Court, and nowhere does it confer upon the Reference Court the authority to set aside an award and remand the matter for fresh adjudication.

The appellants argued that the Reference Court is not an appellate body but functions as an original court tasked with determining the adequacy of compensation upon a reference made under the Act. Therefore, its role is limited to examining whether the compensation awarded by the Collector is just and reasonable and, if necessary, enhancing or modifying the same.

It was further submitted that the Reference Court had erroneously assumed appellate powers by setting aside the Collector’s award and directing a fresh determination. Such powers, according to the appellants, are reserved exclusively for appellate courts and cannot be exercised by a Reference Court.

The appellants also contended that the Land Acquisition Act, 1894 is a complete code in itself, providing a comprehensive mechanism for determination and challenge of compensation. They argued that allowing the Reference Court to remand matters would disrupt the statutory scheme and lead to unnecessary delays in the adjudication process.

Additionally, it was submitted that even if the Reference Court was of the opinion that the compensation should have been determined under the 2013 Act, it was still required to decide the reference on merits rather than remanding the matter. The appellants urged the High Court to set aside the impugned order and direct the Reference Court to adjudicate the matter in accordance with law.

Arguments on Behalf of the Respondent (Landowners):

The respondents, representing the landowners, supported the decision of the Reference Court, arguing that the award passed by the Collector was fundamentally flawed as it was determined under the 1894 Act instead of the 2013 Act, which provides for higher and more equitable compensation.

It was contended that the Reference Court, in exercising its jurisdiction, is empowered to ensure that the compensation awarded is in accordance with the prevailing legal framework and principles of fairness. Therefore, if the initial determination itself was based on an incorrect statutory provision, the Reference Court was justified in setting aside the award and directing a fresh determination.

The respondents further argued that the object of the land acquisition laws is to ensure just and fair compensation to landowners whose property is acquired by the State. In this context, a technical interpretation of jurisdiction should not defeat substantive justice.

It was also submitted that the Reference Court’s decision to remand the matter was aimed at ensuring a proper and comprehensive reassessment of compensation, which could not have been effectively undertaken without reconsideration by the Collector.

The respondents urged the Court to adopt a liberal interpretation of the powers of the Reference Court, emphasizing that procedural limitations should not come in the way of achieving equitable outcomes.

Judgment:

After a detailed consideration of the statutory framework, judicial precedents, and the arguments advanced by both parties, the Allahabad High Court delivered a decisive judgment clarifying the scope of the powers vested in a Reference Court. The Court began by emphasizing that the Land Acquisition Act, 1894 is a complete and self-contained code, which exhaustively defines the roles and functions of the Collector, the Reference Court, and the appellate courts.

The Court observed that under the scheme of the Act, if a landowner is dissatisfied with the compensation awarded by the Collector, the appropriate remedy is to seek a reference to the Reference Court. The Reference Court is then required to independently determine the compensation based on the evidence and material placed before it.

Crucially, the Court held that the Reference Court does not possess the power to set aside the award of the Collector or to remand the matter for fresh determination. Such powers are characteristic of appellate jurisdiction and cannot be exercised by a court functioning as an original authority.

The Court further clarified that the Reference Court’s jurisdiction is confined to redetermining the compensation and making appropriate modifications, if necessary. It cannot nullify the Collector’s award and send the matter back for reconsideration.

Addressing the argument that the compensation should have been determined under the 2013 Act, the Court held that even in such circumstances, the Reference Court is required to decide the matter on merits within the framework of its jurisdiction. It cannot abdicate its responsibility by remanding the matter to the Collector.

The Court also examined the provisions of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 and found that even under the 2013 Act, there is no provision empowering the Reference Court to set aside an award and remand the matter.

In a categorical observation, the Court held that the Reference Court had acted beyond its jurisdiction and in contravention of the statutory scheme by setting aside the Collector’s award and remanding the matter. Such an order, the Court held, was legally unsustainable and liable to be set aside.

Accordingly, the High Court allowed the appeal and quashed the impugned order passed by the Reference Court. It directed the Reference Court to decide the reference on merits, in accordance with law, without exceeding the limits of its jurisdiction.

The judgment thus reinforces the principle that statutory authorities must act strictly within the bounds of the powers conferred upon them and cannot assume jurisdiction that has not been expressly granted. It also underscores the importance of maintaining the distinction between original and appellate jurisdiction in the administration of justice.