Summary and Analysis of Kalpataru Power Transmission Ltd vs Vinod & Ors

1. Heading of the Judgment

KALPATARU POWER TRANSMISSION LTD. & ORS. vs. VINOD & ORS. ETC.
CIVIL APPEAL NOS. 10882-10888 OF 2025 (Along with other connected appeals)
Supreme Court of India
Date of Judgment: August 19, 2025
Coram: Hon'ble Mr. Justice M.M. Sundresh and Hon'ble Mr. Justice Rajesh Bindal

Citation: Kalpataru Power Transmission Ltd. & Ors. vs. Vinod & Ors. Etc., (2025) INSC 1004, Civil Appeal Nos. 10882-10888 of 2025 (SC).

2. Related Laws and Sections

The judgment primarily interprets and deals with the following laws:

• The Indian Telegraph Act, 1885: Specifically, Sections 10(d) and 16(3). These sections grant the power to erect transmission lines and provide the mechanism for resolving disputes over compensation payable to landowners.

• The Electricity Act, 2003: Section 164 applies the provisions of the Indian Telegraph Act, 1885, to electricity transmission projects.

• The Constitution of India: Articles 226 and 227, under which the High Court's jurisdiction was invoked.

• Guidelines by the Ministry of Power (MOP Guidelines): Dated 15.10.2015, which suggest a formula for compensation (85% of circle rate for tower base area and up to 15% for the Right of Way corridor).

3. Basic Judgment Details

• Parties:
  Appellants (in various appeals):
  Kalpataru Power Transmission Ltd. (now Kalpataru Projects International Ltd.): The subcontractor responsible for erecting transmission towers and lines.
  Jhajjar KT Transco Pvt. Ltd. (JKTPL): The company awarded the main transmission project.
  Respondents (in various appeals): Vinod, Rati Ram, and other landowners whose agricultural land was used for erecting transmission towers and drawing high-tension power lines.

• Origin of the Case: The appeals arose from a common judgment dated 24.02.2023 passed by the Punjab & Haryana High Court. The High Court had clubbed together several petitions (writ petitions and civil revisions) challenging orders from District Courts in Sonepat and Jhajjar. These District Courts had awarded compensation to landowners for the use of their land for a power transmission project.

• Core Dispute: The central issue was the correct method for assessing compensation payable to landowners when only a "right of way" is acquired for erecting electricity transmission towers and lines, and the ownership of the land remains with them. The contractor companies argued the compensation awarded was excessive and without basis, while the landowners sought further enhancement.

4. Explanation of the Judgment

The Supreme Court's decision can be broken down into several core parts.

A. Errors in the High Court's Judgment

The Supreme Court identified critical flaws in the High Court's approach:

1. Uniform Application of Rates: The High Court applied a uniform compensation rate (85% of a collector rate of ₹1.5 crore/acre for tower base, 15% for the Right of Way corridor) for the entire 100-km-long transmission line passing through multiple villages in four different districts (Jhajjar, Rohtak, Bhiwani, Sonepat). The Supreme Court held this was illegal as the value of land varies drastically based on location (e.g., proximity to highways, urban areas, or remote farmland). A one-size-fits-all approach is irrational.

2. Reliance on Inadmissible Evidence: The High Court relied heavily on Ministry of Power (MOP) Guidelines from 2015, which were issued years after the project was notified (2010) and the disputes arose (2012). The Court noted these guidelines were merely advisory for states to adopt, and Haryana had not adopted them. Administrative guidelines cannot bind the judicial power of a court to determine fair compensation based on evidence.

3. Factual Inaccuracy: The High Court's judgment discussed facts and evidence only from cases in the Sonepat district but applied its findings to cases from the Jhajjar district as well, without any discussion of the local evidence from Jhajjar. This was a fundamental error.

4. Erroneous Exercise of Jurisdiction: The High Court treated the matter as if it were an original petition, deciding facts based on pleadings that were "not denied." The Supreme Court clarified that the High Court was exercising its supervisory (Article 227) or writ (Article 226) jurisdiction over lower court orders. Its role was to review the legality of the lower courts' decisions based on the evidence they had considered, not to reassess facts as a primary court.

B. Legal Principles for Assessing Compensation

The Supreme Court reiterated the legal principles governing such cases:

• Right of User, Not Ownership: Under Section 10(d) of the Telegraph Act, 1885, the government or its authorized company only acquires a right of user in the land for placing towers and lines. The ownership remains with the landowner.

• Compensation for Damage: The authority must pay "full compensation" for any damage sustained by the landowner due to this exercise of power. This primarily covers:
  The area occupied by the four legs of a tower (Tower Base Area), which becomes largely unusable.
  The diminution in value of the land under the overhead lines (Right of Way corridor) due to restrictions on construction, planting tall trees, etc.

• Factors for Determination: There is no fixed formula. The Supreme Court cited its precedent in Kerala SEB v. Livisha (2007) which mandates that compensation must be determined on a case-by-case basis considering:
  The situs and market value of the specific land.
  The extent of the line over the property.
  The nature of restrictions imposed.
  The effect on the land's utility for its intended purpose (e.g., agriculture).

C. The Critical Gap in the Law: Lack of an Appellate Remedy

A significant part of the judgment is devoted to a larger systemic issue highlighted by this case.

• Finality of District Judge's Order: Section 16(5) of the Telegraph Act, 1885, states that the order of the District Judge determining compensation "shall be final." This means there is no statutory right of appeal provided against this order.

• Ineffective and Inconsistent Remedies: Aggrieved parties are forced to file either a writ petition (Article 226) or a revision petition (Article 227) before the High Court. These are extraordinary remedies with a limited scope of judicial review. The High Court does not typically re-appreciate evidence or act as a regular appellate court. This leads to ineffective justice and inconsistency, as seen in this case where different parties chose different remedies.

• Other Legislative Gaps: The Court also noted the 1885 Act is archaic and silent on crucial aspects like:
  Timelines for paying compensation.
  The period of limitation for a landowner to file a claim.
  The rate of interest for delayed payments.

• Contrast with Other Laws: The Court contrasted this with modern acquisition laws like the Land Acquisition Act, 1894, and the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, which all provide a clear right of appeal to a higher court.

D. Supreme Court's Decision and Directions

1. On Merits: The Supreme Court set aside the impugned judgment of the Punjab & Haryana High Court. It remanded all the cases back to the High Court for a fresh decision in accordance with the law. The High Court was directed to consider the evidence from each district separately and not apply a uniform rate.

2. Referral for Law Reform: Recognizing the systemic problem, the Supreme Court issued two crucial directives:
   A copy of the judgment was to be sent to the Secretary, Legislative Department, Ministry of Law and Justice, Government of India. The Ministry is to examine the issue and consider amending the Telegraph Act, 1885 (and similar laws like the Petroleum and Minerals Pipelines Act, 1962) to introduce a statutory right of appeal against orders of the District Judge and to clarify other procedural aspects.
   A copy was also sent to the Registrar General of the Punjab & Haryana High Court to bring uniformity in how such cases are registered (as civil suits or civil miscellaneous applications) across districts.

Final Outcome

The Supreme Court allowed the appeals, quashed the High Court's order, and sent the cases back for fresh hearing. More importantly, it highlighted a critical gap in the legal framework and initiated a process for potential legislative reform to ensure effective justice for millions of landowners affected by infrastructure projects across India.