Effects of Form H under Land Acquisition Act 1960

PENGARAH TANAH DAN GALIAN SELANGOR & ANOR v. PNSB ACMAR SDN BHD & ANOR AND ANOTHER APPEAL

COURT OF APPEAL, PUTRAJAYA

HANIPAH FARIKULLAH JCA;   GUNALAN MUNIANDY JCA;   AZIZUL AZMI ADNAN JCA

[CIVIL APPEAL NOS: B-01(A)-451-09-2020 & B-01(A)-470-09-2020]

19 NOVEMBER 2023

Under s. 35 of the Land Acquisition Act 1960 ('LAA') , the word 'possession' also refers to 'actual possession' of the land subject to compulsory acquisition, and not only to 'formal possession'. Therefore, if a Form H as prescribed under the LAA has been issued, and then it is proven that the paymaster agency had occupied the said land, the Land Administrator can no longer issue a notice of withdrawal of a compulsory acquisition.

By the terms of s. 35(1) of the LAA, withdrawal of a compulsory acquisition may only be possible if the possession of the land in question has not yet been taken. The key and determinative question is the meaning of 'possession' as used under the said section. Section 18 of the LAA permits the Land Administrator ('LA') to take possession of the land acquired upon the issuance and service of a Form H. However, the same section does not seek to prescribe the time at which possession takes place, but merely specifies that possession may be taken by the State upon the issuance of the Form H or at any time thereafter. It is an empowering or enabling provision which grants the right to the LA to take possession of the land after issuance and service of Form H. From a plain reading of s. 18, it is clear that it anticipates a further act being carried out by the LA in order for possession to be taken. The words 'at any time thereafter' at the end of para. (a) further supports the construction that s. 18 is not a deeming provision specifying the legal presumption of possession. If s. 18 was intended to create a legal presumption of possession, then the Legislature would have fixed a point in time for possession to take effect, rather than using the form of words in para. (a). Quite clearly, something more must be done by the LA before it was deemed to have taken possession of the land in question. That something more is as specified under s. 22 of the LAA which provides for a presumption of law that, once Form K has been issued by the LA, it is deemed to have taken formal possession of the land in question.

Possession could also be taken by being in actual physical possession of the land. On a proper construction of s. 35 of the LAA, once actual possession of the land is taken, the compulsory acquisition can no longer be withdrawn. This construction is supported by the fact that s. 35 refers to 'possession' and not 'formal possession'. The word 'possession' in s. 35 must therefore carry a meaning different from 'formal possession'. The logical conclusion must be that 'possession' encompasses something wider than 'formal possession'; the latter term is merely a subset of 'possession', and possession can be obtained by being in actual occupation of the land in question. This construction commends itself to logic and common sense, and it would reduce the likelihood of an intentional delay in the issuance of Form K.

The conduct of P to enter into occupation of the portion of the Klang land even before the issuance of the Form H amounted to trespass for as long as the same had not yet been issued. This was because possession could only be taken at the earliest, upon the issuance of the Form H. Once Form H was issued and the agency continued in occupation of the portion of the Klang land, then actual possession would have been acquired at that point by or on behalf of the State. The court was thus in agreement with the conclusion of the High Court, albeit for different reasons. In the present case, possession had been taken at the time of the issuance of the Form H, but only because P, through its agency, was already in occupation of the portion of the Klang land.

The amendments to s. 32 of the LAA, which amended the interest rate for late payments charges from 8% to 5% per annum, had already come into force by the time the High Court pronounced the order in favour of A. Nevertheless, Appeal 451 was not one that arose from an application under s. 37 of the LAA, thus, it would not have been expressly saved by the transitional provision under s. 43 of the Land Acquisition (Amendment) Act 2016 ('Amendment Act'). Be that as it may, the court was of the view that the applicable interest rate should still be that which prevailed prior to the publication of the acquisition of the portion of the Klang land in the Gazette. The reason was that, based on the proper construction of the Amendment Act, the same could not be construed to have retrospective effect to take away a substantive right of A. Accordingly, considering that the applicable interest rate for late payment charges applicable was 8% per annum, the High Court had not committed any appealable error in awarding the same to A.

As per s. 29 of the LAA, the obligation to pay compensation lies with the LA. As such, the DG bore no liability for the payment of compensation to A.

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