Apportionment of Compensation — Land Law Notes

Apportionment of Compensation

🔑 KEY POINT — this topic is often set as a PAIR

KSLU repeatedly asks “apportionment and payment” in a single essay. So this topic teaches apportionment in full and carries a short summary of payment; for the detailed payment rules (deposit, investment, interest) read Topic 4, which is the other half of the same answer.

The Collector fixes a lump sum for one plot of land — say ₹40 lakh. But that plot has a widow with a life interest, three sons who are heirs, and a bank holding a mortgage over it. The ₹40 lakh is settled; the fight now is whose share is it? That second fight — dividing one compensation among many claimants — is apportionment, and the Act keeps it firmly separate from fixing the amount.

What apportionment is

Here is the everyday idea: apportionment is slicing one cake among several people who all have a claim to it. The size of the cake (the total compensation) is decided under Unit 1’s valuation rules; apportionment only decides how the slices are cut among the persons interested in that land. It lives in sections 75–76.

The one principle to grasp is a division of labour between the Collector and the Authority:

The Collector’s job is to acquire the land and pay for it. When he apportions, he is only recording who he believes is entitled, so he can pay someone. He has no power to finally decide disputed title to the money.
Title fights go to the Authority (or a civil court), not the Collector.

A. Agreed apportionment (s. 75)

Where several persons are interested and they agree on how to split the compensation, the particulars of that agreed apportionment are recorded in the award. As between those persons, the award is then conclusive evidence of the correctness of the apportionment — they cannot later reopen it.

Section 75, RFCTLARR Act, 2013 (particulars of apportionment): where there are several persons interested and they agree in the apportionment of the compensation, “the particulars of such apportionment shall be specified in the award, and as between such persons the award shall be conclusive evidence of the correctness of the apportionment.”

In Simple Terms: If everyone with a claim to the land agrees on the split, the Collector simply writes that split into the award, and that agreed division is final between them. No agreement means the dispute goes upward.

The limit on “conclusive” (case law). The words “as between such persons” bind only the persons who were before the Collector. A person who was not before him is not bound — the award cannot quietly extinguish an absent claimant’s rights.

B. Dispute as to apportionment (s. 76)

When the total compensation has been settled but a dispute arises — as to the apportionment itself, or who is entitled to receive it — the Collector refers the dispute to the LARR Authority for decision (Topic 2). The Collector does not decide it; he channels it to the tribunal.

Section 76(1), RFCTLARR Act, 2013 (dispute as to apportionment): “When the amount of compensation has been settled, if any dispute arises as to the apportionment of the same or any part thereof, or as to the persons to whom the same or any part thereof is payable, the Collector may refer such dispute to the Authority.”

In Simple Terms: Once the amount is fixed, any quarrel over who gets how much is not for the Collector to settle — he sends it to the Authority, which adjudicates it like a court.

Two limits worth naming (case law):

The Collector cannot finally adjudicate title to the compensation; his apportionment is conclusive only between him and the claimants, not among the claimants themselves (Dr. G.H. Grant).
The Authority’s reference is confined to the dispute referred — it cannot re-open the whole award or decide a declaration of ownership / rendition of accounts, which remains a civil court matter (Gurtej Singh; Rana Dahal Jung).

C. Payment — the paired half (summary; full detail in Topic 4)

Because the essay usually couples the two, keep this compact bridge ready: once shares are apportioned, the Collector pays each interested person by depositing into their bank account (s. 77); but where a person refuses to receive, is incompetent to alienate, or there is a dispute as to title or apportionment, the Collector instead deposits the compensation with the Authority (which then invests it under ss. 78–79); and delayed payment carries interest at 9%, rising to 15% after one year (s. 80). In short: apportionment decides the shares; payment (or deposit) delivers them. See Topic 4 for the worked detail.

🧩 WORKED EXAMPLE — three heirs and one mortgagee

Facts. Compensation of ₹40 lakh is settled for a plot. The three sons agree to take a third each; but a bank claims part of the money under a mortgage, and one son disputes the bank’s claim. What happens?

Rule. Agreed apportionment is recorded and is conclusive between those who agreed (s. 75). A genuine dispute as to apportionment or entitlement is referred by the Collector to the LARR Authority (s. 76); the Collector cannot finally decide title, and meanwhile the disputed money is deposited with the Authority (s. 77).

Apply. The undisputed split among the three sons can be recorded under s. 75. The disputed portion — the bank’s mortgage claim — is a dispute “as to the persons to whom the same is payable,” so the Collector refers it to the Authority under s. 76 and deposits that portion with the Authority under s. 77 rather than paying it out.

Conclusion. Agreement is honoured where it exists; the contested slice goes to the Authority. The Collector never adjudicates the title fight himself.

flowchart TD
    ROOT["Apportionment (ss.75-76)<br/>dividing ONE compensation<br/>among several interested persons"]:::root
    ROOT --> AG{"Do the interested persons<br/>AGREE on the split?"}:::decide
    AG -->|"Yes"| S75["s.75 Agreed split recorded in award<br/>= conclusive BETWEEN those persons<br/>(not binding on absent persons)"]:::leaf
    AG -->|"No"| S76["s.76 Collector REFERS dispute<br/>to LARR Authority<br/>(apportionment / who is entitled)"]:::leaf
    S76 --> LIM["Collector cannot decide title;<br/>declaration/accounts = civil court"]:::leaf
    S76 --> PAY["Disputed money DEPOSITED<br/>with Authority (s.77) -> Topic 4"]:::leaf
    classDef root fill:#FFF8DC,stroke:#000,stroke-width:1px,color:#000;
    classDef leaf fill:#E6F3FF,stroke:#1E3A8A,color:#000;
    classDef decide fill:#FEF3C7,stroke:#92400E,color:#000;
    linkStyle default stroke:#888,stroke-width:1px;

Case Laws

Dr. G.H. Grant vs State of Bihar (1966) — the Collector apportions only to know whom to pay; he has no power to finally adjudicate title to the compensation, and his award is conclusive only between him and the claimants, not among them.
Hurmutjan Bibi vs Padma Lochun Das (1885) — the expression “as between such persons” binds only those who were before the Collector; it cannot bind persons who were not parties to the apportionment.
Gurtej Singh vs Jagan Nath (1996) — a suit for a declaration of ownership and rendition of accounts cannot be decided on an apportionment reference; that relief lies only with a civil court, not under s. 76.
Rana Dahal Jung vs Rani Hem Kumari Devi (1960) — the Authority/Court on a reference is confined strictly to the dispute referred; it cannot extend the scope or reopen a part of the award that has become final.

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