Yadavrao
P. Pathade Vs. State of Maharashtra [1996] INSC 136 (25 January 1996)
K. Ramaswamy,
S. Saghir Ahmed, G.B. Pattanaik
ACT:
HEAD NOTE:
WITH CIVIL
APPEAL NOS.2873-75,2876-2911,2913 2912 &2914/96
----------------------------------------------------- (Arising out of SLP (C)
Nos.15861-63, 15865-99, 16381, 18455 of 1993 and SLP (C) No.3747 /96
[CC-22430])
O R D
E R
Leave
granted.
The
only question is: whether the appellants are entitled to payment of interest on
solatium payable under Section 23(2) of the Land Acquisition Act (Act 1 of
1894) (for short, 'the Act'). The additional amount was awarded by the
reference Court on December
15, 1979 enhancing the
compensation. The High Court by its judgment dated 4.12.1995 has further
enhanced the compensation to Rs.42,056-15. The appellants claimed interest on solatium
of Rs,6308-42 which was disallowed by the High Court. The interest on solatium
was calculated from 1.1.1967 to 31.12.1971. The appellants placed reliance on a
judgment of this Court in Periyar and Pareekanni Rubbers Ltd. vs. State of Kerala
(AIR 1990 SC 2192) contending that interest on solatium is a part of the
component under Section 23(1) of the Act and that, therefore, they are entitled
to payment of the interest. The High Court, therefore, was not right in
refusing interest on solatium. To appreciate the contention it is necessary to
look to the provisions of the Act.
Section
28 gives power to the Court to award interest when the Court enhances the
compensation in excess of amount awarded by the Collector at the rate specified
therein, namely, preceding the Amendment Act 68 of 1984, at 6% per annum under
the Central Act or at the rates as per the appropriate Act amended by the local
amendments to the Act. After the Amendment Act coming into force w.e.f.
September 24, 1984 the claimants would be entitled to interest at 9% p.a. for
one year from the date of taking possession and on expiry thereof, at 15% p.a.
till the date of the deposit into the Court.
Section
23(1) envisages that in determination of compensation to be awarded for the
land acquired under the Act, the Court shall take into consideration the
respective criteria laid in Clauses (1) to (6) applicable to the given facts of
the case. Therefore, the Court is empowered under Section 23(1) to determine
compensation to be awarded to the claimant.
Section
23(2) provides that "in addition" to the market value of the land as
above provided, the Court shall in every case award a sum at 15% preceding the
Amendment Act and after the Amendment Act, 30% p.a. on such market value in
consideration of the compulsory nature of the acquisition. The legislature,
therefore, made a distinction between compensation under Section 23(1) and the
additional amount on such market value as solatium in consideration of
compulsory nature of acquisition. In other words, Section 28 does not
comprehend payment of interest on solatium when it expressly mentions payment
of interest on compensation under Section 28 referable to Section 23(1) of the
Act.
Thus
the High Court was right in not awarding interest on solatium. Similar view was
taken by this Court after Periar's case (supra) by a three-Judge Bench in Prem Nath
Kapur & Anr. etc. v. National Fertilizers Corporation of India Ltd. &
Ors. (C.A.11398/95 etc.) decided on November 29, 1995.
It is
true that in Periyar's case this Court had held that interest on solatium is
part of the component under Section 23(1). Unfortunately, neither the
provisions were considered nor the distinction of the above provisions had been
brought to the notice of this Court at that time. Therefore, mistaken view was
taken to hold that interest on solatium is part of the component of
compensation under Section 23(1) of the Act. It is needless to mention that
under Section 28 the claimants will be entitled to the interest on enhanced
compensation from the date of the award of the Court under Section 26 and on
appeal under Section 54 on the respective compensation, if enhanced, till date
of deposit in the Court. Therefore, the State is required to deposit the
balance of interest on the enhanced compensation till date of deposit into the
Court.
The
appeals are accordingly disposed of but, in the circumstances, without costs..
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