Narain
Das Jain (Since Deceased) by L.rs. Vs. Agra
Nagar Mahapalika [1991] INSC 41 (14 February 1991)
Punchhi,
M.M. Punchhi, M.M. Saikia, K.N. (J)
CITATION:
1991 SCR (1) 389 1991 SCC (4) 212 JT 1991 (1) 461 1991 SCALE (1)215
ACT:
Land
Acquisition Act,1894-Section 23(2)-Solatium- Payment of-Necessity for.
U.P.Town
Improvement Act, 1919-Section 36(2)- Acquisition of land-Payment of
Compensation-Whether arises.
Words
and Phrases: 'Solatium-Meaning of.
HEAD NOTE:
Appellant's
land was acquired by the Agra Town improvement Trust under the provisions of the U.P. Town
Improvement Act, 1919. For the land acquired, the appellant was paid a paltry
sum. No solatium was awarded as none was awardable under the Act. [391B].
The
appellant sought a reference before the Nagar Mahapalika Tribunal. The Tribunal
raised the compensation to Rs.1,45,839 and also awarded interest at the rate of
4- 1/2 percent.
Still
dissatisfied, the appellant moved the High Court in appeal. The Nagarpalika
also filed a cross appeal against enhancement. The High Court allowed the
appeal of the appellant and further enhanced the compensation by Rs.48,613 and
the rate of interest to 6 percent. On the amount of Rs.48,613 solatium at the
rate of 15% was awarded by the High Court. No solatium was however awarded on
the slim Of Rs. 1,45,839 awarded by the Tribunal, on the ground that the
appellant had not made a grouse or laid any claim to it in his grounds of
appeal. The High Court negatived the contention of the appellant that his claim
to solatium was not based on any demand at his instance but it was rather a
statutory duty of the Court to grant it.
Allowing
the appeal, this Court,
HELD:
(1) Solatium, as the word goes, is "money comfort" quantified by the
statute, and given as a conciliatory measure for the Compulsory acquisition of
the land of the citizen, by a welfare state such as ours. [392D-E] 390
(2)
The importance of the award of solatium cannot be undermined by any procedural brocades.
It follows automatically the market value of the land acquired, as a shadow
would to a man. It springs up spontaneously as a part of the statutory growth
on the determination and emergence of market value of the land acquired. That
it falls to be awarded by the Court "in every case" leaves no discretion
with the court in not awarding it in some cases and awarding in others.
[393A-B] Om Prakash v. State of Uttar Pradesh, [19741 2 S.C.C. 731, referred to.
(3) Solatium
in the scheme of section 23(2) of the Land Acquisition Act is part of the
compensation and sections 28 and 34 of the said Act Provide for payment of
interest on the amount of compensation. [394H-395A] Periyar & Pareekanni
Rubbers Ltd. v. State of Kerala, A.I.R. 1990 S.C. 2192, referred to.
(4) Solatium
being part of compensation must fetch statutory interest from the date of
dispossession of the land owner tin date of payment. [395D] Dr. Shamlal Narula
V. Commissioner of Income Tax Punjab, [1964] 7 SCR 668, referred to.
CIVIL
APPELLATE JURISDICTION:Civil Appeal No.2327 of 1977.
From
the Judgment and Order dated 23.5-1975 of the Allahabad High Court in First
Appeal No. 302 of 1966.
K.C.
Jain and H.K. Puri for the Appellants.
A.P.S.
Chauhan, Roopendra Singh and A.S. Pundir for the Respondent.
The
Judgment of the Court was delivered by PUNCHHI, J. This appeal by special leave
is directed against the common judgment and order of the Division Bench of the
Allahabad High Court dated May 23, 1975.
The
appellant herein (since deceased and represented by Legal 391 Representatives)
was the owner of 48613 sq.- yards of land in village Ghatwasan, Teh. Sadar,
Dist. Agra. The same was acquired by the Agra
Town Improvement Trust under the provisions of the U.P. Town
Improvement Act, 1919.
Notification
under section 36(2) of the aforesaid Act. which is analogous to section 4 of
the Land Acquisition Act, 1894 was issued on 29-7-1950 and the acquisition
proceedings culminated by an award of the Land Acquisition Collector, followed
by taking possession of the land from the appellant on 11-3- 1953. For the land
acquired, the appellant was paid a partly sum of Rs. 1344-2 annas &, 6 paise
as compensation. No solatium was awarded as none was awardable under the U.P. Town
Improvement Act, 1919.
Feeling
dissatisfied the appellant sought a reference under section 18 of the Land
Acquisition Act before the Nagar Mahapalika Tribunal, a creature of the U.P.
Town Improvement Act, 1919. The appellant asserted before the Tribunal that he
should have been allowed a rate of Rs.8 per sq. yard for the acquired land. The
Tribunal partly accepted the claim of the appellant by its order dated
5-11-1965 raising compensation to the rate of Rs.3 per sq. yard and thus held
the appellant entitled to a total sum of Rs. 1,45,889 inclusive of the sum of
about Rs. 1344 already received by him. The Tribunal also awarded interest on
the amount due at the rate of 4-1/2 percent per annum with effect from 11-3-1953, the date of taking possession of the land till its
payment.
Still
dissatisfied, the appellant moved the High Court of Allahabad in appeal; a
forum provided under the U.P. Town Improvement (Appeals) Act, 1920, but on grounds analogous
to section 100 CPC.
Correspondingly
the Nagar Mahapalika also filed a cross appeal against enhancement. The
Tribunal disposed of both the appeals by a common judgment. The appellant was
awarded enhanced compensation at the rate of Rs.4 per sq. yard. Consequently an
additional sum of Rs.48613 was held due to him. The High Court also changed the
rate Of interest from 4-1/2 percent per annum to 6 percent per annum,
correcting the error committed by the Tribunal. The claim of the appellant to solatium
at the rate of 15 per cent on the sum awarded uptill the Tribunal's level was
rejected as the appellant had-not claimed the same before the Tribunal and had
not made a grouse thereof in his memorandum of appeal before the High Court. So
on the sum of Rs. 1,45,839 assessed as market value by the Tribunal, no Solatium
was awarded. On the amount of Rs.48,613 enhanced by the High Court, solatium at
the rate of 15 per cent was awarded by the High Court, and interest thereon was
also awarded from 11-3-1953.
392
the date of taking possession till its payment. The appeal of the Nagar Mahapalika
was dismissed. The appellant alone who is before us has challenged the common judgment
of the High Court.
No
dispute herein has been raised to any further increase in the market value of
the land. The claim vehemently put forth is with regard to the solatium of 15
per cent on the market value of the land and which claim, partly has been negatived
by the High Court. It is not disputed that if the claim is valid, the rate of solatium
would be 15 percent of the market value. Though a faint attempt was made to
raise claim to solatium at the rate of 30 per cent and interest to 9 per cent per
annum in terms of the amendments made in the Land Acquisition Act, 1894 by
means of Act No. 68 of 1984, but such claim was abandoned in the next breath.
So we are thus concerned only to the claim of solatium which has been declined
by the High Court.
Section
23(2) of Land Acquisition Act, as it then was, provided that in addition to the
market value of the land, as provided in sub-section (1) of section 23, the
court shall in every case award a sum of rupees fifteen per centum on such
market value in consideration of the compulsory nature of acquisition.
Solatium,
as the word goes, is "money comfort", quantified by the statute, and
given as a conciliatory measure for the compulsory acquisition of the land of
the citizen, by a welfare state such as ours. The concern for such a citizen
was voiced by the Law Commission of India in its Report submitted in 1957 on
the Need for Reform in the Land Acquisition by observing as follows:
"We
are not also in favour of omitting Section 23(2) so as to exclude solatium of
15% for the compulsory nature of the acquisition. It is not enough for a person
to get the market value of the land as compensation in order to place himself
in a position similar to that which he could have occupied had there been no
acquisition; he may have to spend a considerable further amount for putting
himself in the same position as before..... As pointed out by Fitzgerald the
community has no right to enrich itself by deliberately taking away the
property of any of its members in such circumstances without providing adequate
compensation for it. This principle has been in force in India ever since the Act of 1870. The
Select Committee which examined the Bill of 1883 did not think it necessary to
omit the provision but on the other hand transferred it to Section 23."
393 The importance of the award Of solatium cannot be undermined by any
procedural blockades. It follows automatically the market value of the land
acquired, as a shadow would to a man. It springs up spontaneously as a part of
the statutory growth on the determination and emergence of market value of the
land acquired. It follows as a matter of course without any impediment. That it
falls to be awarded by the Court "in every case" leaves no discretion
with the court in not awarding it in some cases and awarding in others. Since
the award of solatium is in consideration of the compulsory nature of
acquisition, it is a hanging mandate for the court to award and supply the
omission at any stage where the Court gets occasion to amend or rectify. This
is the spirit of the provision, wherever made.
It is
pertinent to note here that the claim of the appellant to solatium was not entertainable
before the Land Acquisition Collector, taking proceedings of the acquisition
under the U.P. Town Improvement Act in the absence of a provision allowing it.
Rather the amendments and modifications set out in the schedule attached to the
U.P. Town Improvement Act made read that way. The payment of solatium
as awardable under section 23(2) of the Land Acquisition Act was specifically
not made applicable to the land acquired under the U.P. Town
Improvement Act. Such amendment to the schedule, however, being violative of
Article 14 of the Constitution was struck down by this Court on 14-12-1973 in Om
Prakash & Another v. State of U.P. and Others v. State of U.P. and Others,
[1974] 2 SCC 731. This Court took the view that if the government could acquire
land for a Mahapalika or other local body by resort either to the Land
Acquisition Act or the U.P. Town Improvement Act, it would in the former case
have to pay solatium and in the latter case not at all and which would lead to
discrimination, and consequently granted relief of solatium to the land owner
whose land was acquired. On the law laid down by this Court, the High Court
rightly took the view that since the amendments made to the schedule to the
Town Improvement Act had gone out of the way of the appellant, the compensation
due to him would have to be assessed in accordance with the provisions of
section 23 of the Land Acquisition Act. Holding so, the High Court awarded solatium
on the amount enhanced by it and for that part rightly.
The
denial of the solatium to the appellant on the sum awarded by the Tribunal is
based on the reasoning that firstly the Collector had not awarded solatium and
the appellant while taking the matter to the Tribunal had not raised such
claim. Secondly after the order of the Tribunal the appellant when taking the
matter to the High Court in 394 appeal, had not made a grouse and laid claim to
it in his grounds of appeal. The High Court, it appears was even then prepared
to grant solatium to the appellant and offered the appellant to seek amendment
of the grounds of appeal but the appellant declined to do so asserting that his
claim to solatium was not based on any demand at his instance but was rather a
statutory duty of the Court to grant it, as otherwise, the mandate of section
23(2) would fail. The High Court negatived such contention.
We do
not appreciate the distinction made by the High Court in this regard. The
appellant had all the same not pleaded for grant of solatium in the grounds of
appeal before the High Court while claiming enhanced compensation, and yet the
High Court felt that it was under the statutory duty to grant solatium on the
amount enhanced by it. The High Court did not shut out the claim of the
appellant on the ground that he had not asked for it specifically in the
grounds of appeal. If that is so, the legal error which was otherwise patent
needed to be rectified by the High Court in favour of the appellant; more so
when there was a cross appeal of the Nagar Mahapalika before it and resort
could be had to the provisions of Order 41 Rule 33 C.P.C. Additionally, the
claim to solatium arose in this regard on the basis of Om Prakash's case
(supra) on 14-12-1973 by which the provisions of the U.P. Town Improvement Act whereunder
solatium was withheld were struck down, and on that date the appeal of the
appellant against the order of the Tribunal dated 5-11-1965 was pending before
the High Court. The claim to solatiun surfaced and compulsory acquistition of
the land but also on the law on the subject being declared by this Court in Om Prakash's
case (supra). We are thus of the view that the High Court should have measured
the claim of the appellant to solatium on the sum awarded by the Tribunal with
the same yardstick as to the sum awarded by it and modified in decree
accordingly. We have thus no hesitation in upsetting the judgment and order of
the High Court in this regard and award to the appellant solatium at the rate
of 15% on the entire market value of the land, which would include a sum of Rs.
1,45,839 left out by the Tribunal and the High Court. The appellant further
shall be entitled to the interest at the rate of 6% per annum from 11-3-1953, the date of taking possession, till the date of
payment of the sum due as solatium. The appeal shall stand allowed accordingly.
Before
parting with the judgment, we need to clarify that solatium in the scheme of
section 23(2) of the Land Acquisition Act is part of the compensation and
section 28 and 34 of the said Act pro- 395 vided payment of interest on the
amount of compensation.
This
Court recently in Periyar and Pareekanni Rubbers Ltd. v. State of Kerala, AIR 1990 SC 2192 has ruled that
compensation is recompense or reparation to the loss caused to the owner of the
land and that payment of interest on solatium is to recompensate the owner of
the land the loss of user of the land from the date of taking possession till date
of payment into Court. Therein the land owner was held entitled to interest on solatium).
Attention, however, may be invited to Dr. Shamlal Narula V. Commissioner of
Income-tax Punjab, [1964] 7 SCR 668. The quality of
the sum paid as interest was held somewhat different. It was ruled therein that
the statutory interest paid under the Act is interest paid for the delayed
payment of compensation amount and in no event can that be described as
compensation for owner's right to retain possession, for he has no right to
retain possession after possession was taken under sections 16 and 17 of the
Act. The quality of the receipt of interest can be left by us here, whether it be
a recompense for the loss of user of land or is a sum paid for the delayed
payment of compensation. Solatium being part of compensation must fetch
statutory interest from the date of dispossession of the land owner till date
of payment.
Accordingly,
we allow this appeal and direct that the appellant shall also be paid solatium
at the rate of 15% on the left out amount of Rs. 1,45,839 and interest at the
rate of 6% per annum thereon from 11-3-1953, the date of taking possession till
date of payment, and that too with costs.
R. S.
S. Appeal allowed.
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