Presidential assent saved a state law. The Supreme Court says you can't compare it to the central Act.

Two Laws, One President, and a Landowner’s Last Stand

When C.S. Gopalakrishnan bought a piece of land in Tamil Nadu, he did not expect to become a constitutional test case. The land had already been notified for acquisition under the Tamil Nadu Highways Act, 2001. He bought it anyway. Then he challenged the very law under which the government was taking it. The Supreme Court had a short answer for him: you cannot challenge a law that was already in motion when you bought the land. But for the other landowners who had not bought post-notification, the Court had a longer answer — one that goes to the heart of how India’s federal structure works.

At stake was nothing less than the validity of two state laws — the Tamil Nadu Highways Act, 2001, and the Tamil Nadu Acquisition of Land for Industrial Purposes Act, 1997 — that had been used for decades to acquire land without the compensation safeguards and timelines that the central Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (RFCTLARR Act) promised. If the landowners won, every acquisition under these state laws would be open to challenge. If the state won, the laws would survive — and with them, the government’s ability to acquire land faster and cheaper than the central law allowed.

The story of two state laws

Tamil Nadu has long had its own land acquisition machinery. The Highways Act of 2001 and the Industrial Purposes Act of 1997 were both enacted under Entry 42 of the Concurrent List (acquisition of property), and both received the President’s assent under Article 254(2) of the Constitution. That assent is crucial: it means that even if the state law contradicts a central law on the same subject, the state law prevails in that state.

Then came 2013. Parliament enacted the RFCTLARR Act — a comprehensive, rights-based land acquisition law that mandated social impact assessments, rehabilitation packages, and strict timelines. Section 105-A of that Act said that the central law would not apply to certain state Acts. But the Madras High Court, in a 2019 judgment, held that Section 105-A could not revive state Acts that had become void after the central Act came into force. The state Acts, the High Court said, were dead.

Tamil Nadu responded with a Validation Act in 2015, which also received Presidential assent. The Supreme Court, in G. Mohan Rao v. State of Tamil Nadu (AIR 2021 SC 3126), upheld that Validation Act. The state laws were back in business.

But the landowners did not give up. They came back to the Supreme Court with a new argument: even if the state laws were validly enacted, they were arbitrary and discriminatory under Article 14 of the Constitution. The Highways Act, they said, had no fixed timelines for completing acquisition. The Industrial Purposes Act had no provision for rehabilitation. The central Act had all of these. Why should a landowner in Tamil Nadu get less protection than a landowner in, say, Uttar Pradesh?

The argument that almost worked

The learned Counsel for the appellants pressed hard on the discrimination point. They cited Nagpur Improvement Trust v. Vithal Rao (AIR 1973 SC 689) on compensation principles. They argued that the absence of timelines in the Highways Act made it arbitrary — the government could sit on a notification for years, leaving landowners in limbo.

The State of Tamil Nadu, represented by its learned Counsel, countered with a simple but powerful point: Article 254(2) exists precisely to allow state laws to differ from central laws. If every difference could be challenged under Article 14, the provision would be meaningless. The state also pointed out that the Highways Act had its own safeguards — Section 15(1) and 15(2) required the government to pass an award within a reasonable time, and landowners could seek compensation through civil courts.

The witness rule the Supreme Court applied

Justice Sanjay Kumar, writing for the two-judge Bench (also comprising Justice Dinesh Maheshwari), delivered the judgment on May 9, 2023. The Court dismissed all the appeals, but it did so on different grounds for different appellants.

For the appellants in Civil Appeal Nos. 5692-5693 — the ones who had purchased land after the Section 3(2) notification under the Industrial Purposes Act — the Court applied the rule from Shiv Kumar v. Union of India (2019) 10 SCC 229: a subsequent purchaser of land that is already under acquisition cannot challenge the acquisition itself. They had bought the land with notice of the acquisition. They had no locus standi.

For the appellants in Civil Appeal Nos. 5694-5695, the challenge to the Validation Act had already been decided in G. Mohan Rao. Those appeals were rendered infructuous.

That left Civil Appeal No. 5697 — the challenge to the Highways Act on Article 14 grounds. This was the one that mattered.

The doctrine that mattered

The Court’s reasoning on Article 14 is the heart of this judgment. And it is deceptively simple.

The Court held that a State enactment protected by Presidential assent under Article 254(2) cannot be invalidated under Article 14 merely because its provisions differ from the central legislation on the same subject. The very purpose of Article 254(2) is to permit such disparity. If the Constitution itself allows a state law to override a central law, then comparing the two under Article 14 would defeat that constitutional scheme.

The Court relied on State of MP v. G.C. Mandawar (AIR 1954 SC 493), where the Supreme Court had held that Article 14 does not authorize the striking down of one legislature’s law by comparing it with another legislature’s law. The same logic applied here: the Highways Act was a law made by the Tamil Nadu Legislature, with Presidential assent. The RFCTLARR Act was a law made by Parliament. They came from different legislative sources. You cannot compare them under Article 14.

The Court also followed State of Tamil Nadu v. Ananthi Ammal (1995) 1 SCC 519, where the same principle had been applied to uphold the Tamil Nadu Acquisition of Land for Harijan Welfare Schemes Act, 1978.

The appellants had cited P. Vajravelu Mudaliar v. Special Deputy Collector, Madras (AIR 1965 SC 1017), where the Supreme Court had struck down a classification between lands acquired for housing and other purposes as unreasonable under Article 14. But the Court distinguished that case: in Vajravelu Mudaliar, the classification was made by the same legislature through an amendment that did not receive Presidential assent under Article 254(2). Here, the two laws were made by different legislatures, and the state law had the protection of Presidential assent.

THE PLAY: If you are challenging a state law that has received Presidential assent under Article 254(2), do not argue that it is discriminatory compared to the central law. The Court will not entertain that comparison. Argue instead that the state law is arbitrary on its own terms — that its own provisions, without reference to any other law, violate Article 14.

What the post-mortem actually said

The Court also addressed the argument that the absence of fixed timelines in the Highways Act made it arbitrary. The landowners pointed out that the RFCTLARR Act had specific timelines for completing acquisition — and if the government failed to meet them, the acquisition lapsed. The Highways Act had no such provision.

The Court was not impressed. It observed that even the RFCTLARR Act had extension provisions without outer limits. More importantly, the Court held that the absence of timelines does not per se render a State Act unconstitutional. Individual cases of delay must be dealt with on their own merits. If the government takes too long to pass an award, the landowner can challenge that specific delay. But the law itself is not invalid because it does not prescribe a deadline.

This is significant obiter: the Court left the door open for case-by-case challenges to delayed acquisitions under the Highways Act. The Act survives, but individual landowners can still argue that the government’s delay in their specific case was unreasonable.

Why the Trial Court got it wrong

There was no trial court here — the matter came directly to the Supreme Court from the Madras High Court. But the High Court had partly allowed the writ petitions, declaring the state Acts void before the Supreme Court reversed that in G. Mohan Rao. The Supreme Court’s judgment in G. Mohan Rao effectively overruled the High Court on the validity of the state Acts. The present judgment closed the remaining Article 14 challenge.

Why this matters in practice

For advocates, this judgment is a reminder that Article 14 is not a universal solvent for every legislative difference. When a state law has the protection of Article 254(2), the comparison must be internal — is the law arbitrary within its own framework? — not external — is it different from the central law?

For CFOs and founders, the practical takeaway is this: if your company is acquiring land in Tamil Nadu under the Highways Act or the Industrial Purposes Act, the legal framework is valid. The absence of central-law-style timelines does not make the acquisition void. But you should still ensure that the government moves with reasonable speed in each individual case, because landowners can still challenge unreasonable delays.

For landowners, the message is sobering. If you buy land after the acquisition notification, you lose your right to challenge the law itself. And even if you owned the land before the notification, you cannot argue that the state law is bad because the central law is better. Your only recourse is to show that the state law, on its own terms, is arbitrary — a much harder argument to make.

The bottom line

If you are challenging a state law that has Presidential assent under Article 254(2), do not compare it to the central law. Compare it to itself. And if you bought the land after the notification, do not bother — you have no standing.