Kalidas & Ors Vs. Spl. Land Acquisition Officer & Anr  Insc 951 (13 December 2006)
Singh & Altamas Kabir
out of SLP) No.11062-135 OF 2002) WITH
C.A Nos. 5786 /06 @ SLP(C) Nos.11136-11192 of 2002, C.A Nos. 5787 /06 @ SLP(C)
Nos.11194-11205 of 2002, C.A Nos. 5788 /06 @ SLP(C) Nos.11206-11225 of 2002,
C.A Nos. 5789 /06 @ SLP(C) Nos.11227-11237 of 2002, C.A Nos. 5790 /06 @ SLP(C)
Nos.11238-11247 of 2002, C.A Nos. 5791 /06 @ SLP(C) Nos.11248-11260 of 2002,
C.A Nos. 5792 /06 @ SLP(C) Nos.11262-11270 of 2002, C.A Nos. 5793 /06 @ SLP(C)
Nos.11273- 11279 of 2002, C.A Nos. 5794 /06 @ SLP(C) Nos.11280-11289 of 2002,
C.A Nos. 5795 /06 @ SLP(C) Nos.11291-11299 of 2002, C.A Nos. 5796 /06 @ SLP(C)
Nos.11310-11314 of 2002, C.A Nos. 5797 /06 @ SLP(C) Nos.11401-11440 of 2002,
C.A Nos. 5798 /06 @ SLP(C) Nos.11369-11387 of 2002, C.A Nos. 5799 /06 @ SLP(C)
Nos.11315-11336 of 2002, C.A Nos. 5800 /06 @ SLP(C) Nos.11389-11400 of 2002,
C.A Nos. 5801 /06 @ SLP(C) Nos.11358-11368 of 2002, C.A Nos. 5802 /06 @ SLP(C)
Nos.11301-11309 of 2002, C.A Nos. 5803 /06 @ SLP(C) Nos.11441-11451 of 2002,
C.A Nos. 5804 /06 @ SLP(C) Nos.11338-11355 of 2002, C.A Nos. 5805 /06 @ SLP(C)
Nos.11356-11357 of 2002.
to file SLP granted.
this batch of appeals the sole question which falls for consideration is
whether the appellants herein are entitled to maintain an application for
special leave before this Court impugning the judgment and order of the High
Court which affirmed the findings of the Reference Court under Section 18 of
the Land Acquisition Act in appeals preferred by the Special Land Acquisition
Officer the respondent herein. The appellants contend that the High Court ought
to have, even in the appeals preferred by the Special Land Acquisition Officer,
awarded interest on solatium payable under Section 23 (2) of the Land
Acquisition Act. The respondent on the other hand, contends that the appeals
had been preferred before the High Court by the Special Land Acquisition
Officer in which the appellants herein were the respondents. The appeals
preferred by the Special Land Acquisition Officer having been dismissed by the
High Court, the appellants cannot be said to be parties aggrieved by the
judgment and order of the High Court. Before the High Court they had not even
prayed for grant of interest on solatium and, therefore, they cannot be
permitted to move this Court by way of special leave claiming such relief. It
is not disputed by them that if really such a claim was made either before the
Collector or before the Reference
Court dealing with
the matter under Section 18 of the Land Acquisition Act, having regard to the
law as now settled by a decision of this Court, interest on solatium was bound
to be granted to the appellants.
few facts which are relevant for the disposal of these appeals are as follows:-
Five Notifications under Section 4 of the Land Acquisition Act, 1894
(hereinafter referred to as the "Act) was published for acquisition of
lands situated in Village Vekara District Mehsana, Gujarat. The appellants are the land-owners
of the lands sought to be acquired by the aforesaid Notifications. The Special
Land Acquisition Officer offered compensation @ Rs.24,000/- per hec. (Rs.2.40
per sq. mtr.) for irrigated lands and Rs.16,000 per. hec. (Rs.1.60 per sq. mtr.)
for non-irrigated lands. The appellants claimed a reference under Section 18 of
the Act and demanded compensation @ Rs.30 per sq. mtr.. By its judgment and
order of April 20, 2000 the Reference Court under Section 18 of the Land
Acquisition Act determined the market value of the lands of the appellants @
Rs.22 per sq. mtr..
it did not award interest on the amounts payable under Section 23 (1A) and
Section 23(2) of the Land Acquisition Act, namely, on the amount payable by way
of additional amount and solatium. The Reference Court following the judgment of this Court India Ltd. & Ors.
(1996) 2 SCC 71 held that no interest was payable in respect of amounts
envisaged by Section 23 (1A) and 23 (2) of the Act.
by the judgment and order of the Reference Court enhancing the compensation payable to the appellants, the
Special Land Acquisition Officer preferred First Appeal Nos.1320 to 1395 of
2001 before the High Court of Gujarat at Ahmedabad which came to be disposed of
by the judgment and order of the High Court dated September 19, 2001. The High Court found no reason to interfere with the
determination of compensation by the Reference Court and accordingly dismissed the appeals.
instant special leave petitions have been filed by the claimants contending
that the High Court ought to have awarded interest on the amounts payable under
Section 23(1A) and 23(2) of the Act. It is their case that the interest payable
on these amounts must be incorporated in the decree of the Court even if no
prayer is made for it because the Act obliges the Collector to pay such
interest on the amount determined by the Collector or the Court. For awarding
such interest no exercise of judicial discretion is called for. Only an
arithmetical exercise has to be undertaken to calculate the interest payable.
They, therefore, submit that the High Court ought to have passed an order
awarding interest to the appellants on the amounts payable under Section 23 (1A)
and 23 (2) of the Act even if no formal claim was made before it by the
appreciate the submission of the appellants it is necessary to notice a few
question as to whether interest is payable on the additional amount payable under
Section 23 (1A) and on solatium under Section 23 (2) of the Act came up for
consideration before this Court in Union held that "market value" is
only one of the components to be reckoned with in the determination of the
amount of compensation. Solatium did not form part of the "market
value" of the land. Thus the word "compensation" in Section 23
(1) of the Act consists of the "market value" of the land and the solatium
which is the consideration for the compulsory nature of the acquisition.
Following the principle laid down in Ram Mehar, a two Judge Bench of this Court
in Periyar and affirmed the view that the claimant is entitled to interest on solatium
under the Act.
Collector, Land Acquisition, Hyderabad
(1995) 3 SCC 208, a three Judge Bench of this Court held that solatium is not a
part of the award and hence interest is not claimable thereon. The same view
was reiterated in Prem Nath Kapoor (supra) and later in Yadavrao P. 570 the
same was reiterated by a three Judge Bench of this Court.
account of the conflict of decisions of this Court of co-equal benches the
matter was ultimately referred to a larger bench of five Judges and the matter
has since been settled by a decision of this Union of India (2001) 7 SCC 211.
The judgment of the Supreme Court was delivered on September 19, 2001.
a co-incidence that the impugned common judgment of the High Court in the
instant case was also pronounced on September 19, 2001, the same day on which
judgment of the larger Bench of the Supreme Court in Sunder's case was
pronounced holding that interest was payable on the amount envisaged by Section
23 (1A) as well as 23 (2) of the Act.
for the respondents contend that there is no reason why the appellants should
be permitted to make a claim before this Court which they had not made before
the High Court. Their claim for grant of interest on these amounts was negatived
by the Reference Court relying upon the earlier judgment
of this Court in Prem Nath Kapoor's case. The appellants did not appeal against
that part of the order of the Reference Court
and, therefore, they have given up their right to claim interest on the
additional amount and the solatium payable under Section 23 of the Act.
appellants on the other hand, contend that at the time when the reference under
Section 18 was decided by the Court, the judgment in Prem Nath Kapoor held the
field and, therefore, in the teeth of that judgment of the Supreme Court it was
not considered advisable to appeal against that part of the order. Even so,
they could have made such a claim before the High Court when the appeal
preferred by the Special Land Acquisition Officer was being heard by it.
Unfortunately, even till then the judgment of the Supreme Court in Sunder's
case had not been pronounced. It is only accidental that the impugned common
judgment and order of the High Court and the judgment in Sunder's case were
pronounced on the same day and, therefore, it was only after the disposal of
the appeals by the High Court that the appellants could, on the strength of the
decision in Sunder's case, claim interest on these amounts. It is for this
reason that they have invoked the special jurisdiction of this Court under
Article 136 of the Constitution of India.
appellants heavily relied on the observations made in Shree That was a case
where Government took possession of certain lands under an arrangement with the
owners on November 19,
1949. It raised
structure on the aforesaid land but did not give land in exchange to the owners
thereof. On February 1,
1955 a Notification
under Section 6 (1) of the Act was issued declaring that the land was needed
for public purpose. The Collector awarded Rs.5075.44 as compensation. The
land-owner asked for a reference under Section 18 of the Act. The Court decided
the reference under Section 18 and found that the claimant was entitled to
compensation on the basis of market value of the land on the date of
Notification under Section 6 of the Act. It accordingly awarded compensation @
Rs.3 per sq. yard as also solatium @ 15 per cent and interest @ 6 per cent from
February 1, 1955. The award of the Court was
challenged by the State which preferred an appeal before the High Court. The
High Court held that the relevant date for determining the compensation based on
determining the market value of the land was the date of the Notification under
Section 4 (1) of the Act and since no such Notification was issued it was not
possible to determine the amount of compensation payable under the Act. The
claimants came to this Court after obtaining certificate from the High Court
and finally this Court allowed the appeal and remanded the matter to the High
Court holding that the Notification under Section 6 of the Act be treated as a
composite Notification under Section 4(1) and Section 6 (1) of the Act and,
therefore, the Court could lawfully award the market value of the land on that
day. The High Court thereafter accepted the appeal preferred by the State and
reduced the price of acquired land from Rs.3 per sq. yard to Rs.1.35 per sq.
yard, however rejecting the claim of the claimant to interest from November 19, 1949 instead of February 1, 1955. The claimants therefore, preferred
an appeal in which the aforesaid judgment was rendered.
Court noticed that the State had filed an appeal before the High Court against
the award of compensation @ Rs.3 per sq. yard but the appellant/claimant did
not file any appeal against that part of the award which went against it and
restricted the amount of interest from February 1, 1955 instead of November 19, 1949. The appellant filed cross
objections but they were dismissed as barred by time. The High Court on
interpretation of Section 23(1), 26, 27 and 28 concluded that the interest
payable to the claimants has to be a part of the award decree alongwith the
compensation amount and as such is subject to rules of procedure and
limitation. Thus, the cross objections of the claimants having been rejected as
time barred, it could not claim interest in appeal preferred by State. The High
Court also found that the relief was barred by reason of the principle of res- judicata.
noticing the findings of the High Court this Court held that on a reference
under Section 18 of the Act the parties go to trial primarily for the
determination of market value of the land. So far as award of interest is
concerned, it is never an issue between the parties.
the conditions under Section 28 or Section 34 of the Act are satisfied the
award of interest is consequential and automatic. This Court went on to observe:-
"The High Court while appreciating the point in issue did not consider the
mandatory provisions of Section 34 of the Act. The said section specifically
provides that when the amount of compensation is not paid on or before taking
possession of the land the Collector shall pay interest at 6 per cent per annum
from the date of taking over possession. The payment of interest is not
dependent on any claim by the person whose land has been acquired. There can be
no controversy or any lis between the parties regarding payment of interest.
When once the provision of Section 34 are attracted it is obligatory for the
Collector to pay the interest. If he fails to do so the same can be claimed
from the court in proceedings under Section 18 of the Act or even from the
appellate court/courts thereafter".
Court also observed:- "There is inherent evidence in the wording of
Sections 28 and 34 to show that the framers of the Act intended to assure the
payment of interest to the person whose land was acquired and it was not the
intention to subject the said payment to procedural hazards. Section 34 lays
down that "the Collector shall pay the amount awarded with interest at 6
per cent per annum.." The legislative mandate is clear. It is a directive
to the collector to pay the interest in a given circumstance. Section 34
nowhere says that the interest amount is to be included in the award-decree as
prepared under Section 23(1) read with Section 26 of the Act. Similarly Section
28 provides "the award of the court may direct that the Collector shall
pay interest". Here also the award under Section 23(1) read with Section
26 has been kept distinct from the payment of interest under the section. The
interest to be paid under Section 34 and also under Section 28 is of different
character than the compensation amount under Section 23(1) of the Act. Whereas
the interest, if payable under the Act, can be claimed at any stage of the
proceedings under the Act, the amount of compensation under Section 23(1) which
is an award-decree under Section 26, is subject to the rules of Procedure and
Limitation. The rules of procedure are hand-maiden of justice. The procedural
hassle cannot come in the way of substantive rights of citizens under the Act.
not, therefore, agree with the reasoning and the findings reached by the High
Court. We are of the opinion that it was not necessary for the appellant-
claimant to have filed separate appeal/cross-objections before the High Court
for the purposes of claiming interest under Section 28 or Section 34 of the
Act. He could claim the interest in the State appeal. The fact, that he filed
cross-objections which were dismissed as time barred, is wholly
counsel appearing on behalf of the respondents submitted that in terms of the
judgment in Shree Vijay Cotton even if the claimants had right to claim
interest at any stage, they ought to have made such a claim before the High
Court at any time before the disposal of the appeals. Though, it was not
necessary to make such a claim in any particular form, and neither the rules of
procedure nor the rigors of limitation inhibited the right of the claimants to
claim interest, the least that was expected of them was to make a claim in some
form or the other, which they have failed to do. In such a case, it would not
be appropriate for this Court to exercise its discretion under Article 136 of
the Constitution of India to grant relief to the appellants.
regard to the submissions urged on behalf of the respondents we could have
remitted the matter to the High Court to give an opportunity to the claimants
to make a claim of interest before the High Court. That however, would only be
a formality because having regard to the law laid down in Sunder, the High
Court is bound to award the interest on the additional amount payable under
Section 23(1A) and solatium payable under Section 23 (2) of the Act.
grant of interest on these amounts is consequential and automatic and involves
only arithmetical calculation and not application of judicial mind or exercise
of judicial discretion. It is no doubt true that the appellants ought to have
made such a claim before the High Court, even in the appeals preferred by the
State. But in fairness to the appellants it must be conceded that during the pendency
of the appeals before the High Court the law as laid down in Prem Nath Kapoor
held the field and, therefore, it would have been futile for them to claim
interest. The claimants could have filed such an application before the High
Court if the judgment in Sunder was pronounced when the appeals were pending
before the High Court.
they could not do so because the judgment in Sunder and the impugned judgment
in the appeals preferred by the State before the High Court were pronounced on
the same day. Having regard to these facts, peculiar to this case, we are
persuaded to allow the appeals preferred by the appellants as a special case in
the interest of justice. Accordingly, we hold that the appellants are entitled
to interest on the amounts payable to them under Section 23 (1A) and Section 23
(2) of the Land Acquisition Act. We direct the Collector to calculate the
interest payable and pay the same to the appellants without further delay.
These appeals are accordingly allowed. No order as to costs.