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PETITIONER:

MIR FAZEELATH HUSSAIN & ORS.

Vs.

RESPONDENT:

SPECIAL DEPUTY COLLECTOR, LAND ACQUIS TION, HYDERABAD

DATE OF JUDGMENT23/03/1995

BENCH:

HANSARIA B.L. (J)

BENCH:

HANSARIA B.L. (J)

KULDIP SINGH (J)

SAHAI, R.M. (J)

CITATION:

1995 AIR 1424 1995 SCC (3) 208

JT 1995 (3) 410 1995 SCALE (2)424

ACT:

HEADNOTE:

JUDGMENT:

HANSARIA, J.:

1. A land acquisition proceeding which was initiated by

issuing notification under Section 4(1) of the Land

Acquisition Act, 1984 (hereinafter referred to as 'the Act')

on 25.4.1963 has brought the appellants to this Court as

they have felt dissatisfied with the fixation of a market

value by the Andhra Pradesh High Court, which granted

compensation on belt wise basis. The appeal came up for

hearing before a two Judge bench and by judgments dated May

15, 1992 the appeal came to be allowed in part as indicated

in the judgments. The two learned Judges, however, differed

on the question as to whether the appellants are entitled to

interest as enhanced by Section 18 of the Land Acquisition

(Amendment) Act, 1984 (for short, 'the Amendment Act').

Kasliwal, J. took the view that despite what has been held

by the Constitution Bench in the Case of Union of India v.

Raghubir Singh, 1989 (2) SCC 754 enhanced rate of interest

as visualised in the Amendment Act would be available to the

appellants on a harmonious reading of the provisions, if the

intention of the legislature in enhancing the rate of inter-

est is kept in view. Punchhi, J., however, was of the

opinion that awarding of enhanced rate on the face of what

was held in Raghubir Singh's case would militate against the

ratio of that case and would do violence to the statute.

The learned Judges, therefore, while allowing the appeal in

part and setting aside the judgment of the High Court to the

extend indicated in the judgments, requested the Hon'ble

Chief Justice to constitute a larger bench to resolve the

disagreement with regard to the rate o interest as, though

the controversy is short, the same is likely to affect large

number of cases. Hence, this appeal has come up for hearing

by this bench.

2.The provisions of the Act which are relevant for our

purpose are Sections 11, 23, 25, 26 and 28, which may be

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noted the threshold :

"11. Enquiry and award by Collector.-

(1) On the day so fixed, or on any other day

to which the enquiry has been adjourned, the

Collector shall proceed to enquire into the

objections (if any) which any person

interested has stated pursuant to a notice

given under Section 9 to the measurements made

under Section 8, and into the value of the

land at the date of the publication of the

notification under Section 4, sub-section (1),

and into the respective interests of the

persons claiming the compensation and shall

make an award under his hand of -

413

(i) the true area of the land

(ii) the compensation which in his opinion

should be allowed for the land; and

(iii) the appointment of the said compensation

among all the persons known or believed to be

interested in the land, of whom or of whose

claims, he has information, whether or not

they have respectively appeared before him :

x x x x x x x

x x x x x x x

23. Matters to be considered in determining compensation.

(1) In determining the amount of compensation to be awarded

for land acquired under this Act, the Court shall take into

consideration -

first:-- the market-value of the land at the

date of the publication of the notification

under Section 4, sub-section (1) ;

secondly:-- the damage sustained by the

person interested, by reason of the taking of

any standing crops or trees which may be on

the land at the time of the Collector's taking

possession thereof ;

thirdly:-- the damage (if any) sustained by

the person interested, at the time of the

Collector's taking possession of the land, by

person of severing such land from his other

land;

fourthly:- the damage (if any) sustained

by the person interested, at the time of the

Collector's taking possession of the land, by

reason of the acquisition injuriously affect-

ing his other property, movable or immovable,

in any other manner or his earnings;

fifthly:-- If in consequence of the

acquisition of the land by the Collector, the

person interested is compelled to change his

residence or place of business, the reasonable

expenses (if any) incidental to such change;

and

sixthly:-- the damage (if any) bona fide

resulting from diminution of the profits of

the land between the time of the publication

of the declaration under Section 6 and the

time of the Collector's taking possession of

the land.

(1 -A) In addition to the market-value of the

land, as above provided, the Court shall in

every case award an amount calculated at the

rate of twelve per centum per annum on such

market-value for the period commencing on and

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from the date of the publication of the

notification under Section 4, sub-section (1),

in respect of such land to the date of taking

possession of the land, whichever is earlier.

Explanation. In computing the period referred to in this

sub-section any period or periods during which the pro-

ceedings for the acquisition of the land were held up on

account of any stay or

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injunction by the order of any court shall be excluded.

(2) In addition to the market-value of the land, as above

provided, the Court shall in every case award a sum of

thirty per centum on such market-value, in consideration of

the compulsory nature on the acquisition.

25. Amount the compensation by Court not to be lower than

the amount awarded by the Collector.- The amount of

compensation awarded by the Court shall not be less that the

amount awarded by the Collector under Section 11.

26. Form of awards.- (1) Every award under this Part shall

be in writing signed by the Judge, and shall specify the

amount awarded under clause first of subsection (1) of

Section 23, and also the amounts (if any) respectively

awarded under each of the other clauses of the same sub-

section, together with the grounds of awarding each of the

said amounts.

(2) Every such award shall be deemed to be a decree and the

statement of the grounds of every such award a judgment

within the meaning of Section 2, clause (2), and Section 2,

clause (9), respectively, of the Code of Civil Procedure,

1908. (5 of 19-8).

28. Collector may be directed to pay interest on excess

compensation.If the sum which, in the opinion of the Court,

the Collector ought to have award as compensation is in

excess of the sum which the Collector did award as com-

pensation, the award of the Court may direct that the

Collector shall pay interest on such excess at the rate of

nine per centum per annum from the date on which he took

possession of the land to the date of payment of such excess

into Court:

Provided that the award of the Court may also direct that

where such excess or any part thereof is paid into Court

after the date of expiry of a period of one year from the

date of which possession is taken, interest at the rate of

fifteen per centum per annum shall be payable from the date

of expiry of the said period of one year on the amount of

such excess or part thereof which has not been paid into

Court before the date of such expiry.

3. We may also note Section 18 of the Amendment Act which

brought out amendment in Section 28 of the principal Act,

which reads as below:

"18. Amendment of Section 28. In Section 28

of the Principal Act, -

(a) for the words "six per centum", the

words "nine per centum" shall be substituted;

(b) the following proviso shall be inserted

at the end, namely:-

"Provided that the award of the Court may also

direct that where such excess or any part

thereof is paid into Court after the date of

expiry of a period of one year from the date

on which possession is taken interest at the

rate of fifteen per centum per annum shall be

payable from the date of expiry of the said

period of one year on the amount of such

excess or part thereof which has not been paid

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into Court before the date of such expiry."

4. The aforesaid shows that the rate of interest was

increased from 6 per centum to 9 which would become 15 after

expiry of the period mentioned in the proviso to the

Amendment Act. The question for determination is whether

advantage of the increased in rate of in rest would be

available to the appellants. To decide this we

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have to keep in mind the following dates:

(1) Date of Collector's award 10.6.1968,

(ii) Date of taking over of possession 24.6.1968

(iii) Date of Reference Court's award 30.8.1972;

(iv) Date of the decision of the High Court: 24.6.1974 ;and

(v) Date, of this Court's aforesaid Judgments : 15.5.1992.

5. The answer to the controversy lies mainly in finding

out as to whether the appellants' case is covered by Section

30 (2) of the Amendment Act which reads as below:

"30(2) The provisions of subsection (2) of

Section 23 and Section 28 of the principal

Act, as amended by clause (b) of Section 15

and Section 18 of this Act respectively shall

apply, and shall be deemed to have applied,

also to, and in relation to, any award made by

the Collector or Court or to any order passed

by the High Court or Supreme Court in appeal

against any such award under the provisions of

the principal Act after the 30th day of April,

1982 [the date of' introduction of the Land

Acquisition (Amendment) Bill, 1982, in the

House of the people] and before the

commencement of this Act."

(Emphasis supplied)

6. As to what is the reach and extent of the aforesaid

section came to be examined by the Constitution Bench in

Raghubir Singh's case. Para 32 of that judgment is relevant

for our purpose, according to which the expression "any such

award" in the section referred to awards made by the

Collector or Court between April 30 1982 and September 24,

1984 (which is the date of commencement of the Amendment

Act); or the appeals against such awards decided by the High

Court and the Supreme Court, whether the decisions are

rendered before September 24, 1984 or after that date. In

the present case the award of the Collector as well as of

the Court being before April 30, 1982, on the ratio of

Raghubir Singh's case benefit o amended section28 is not

available to the appellants. However, it deserves to be

noted that Raghubir Singh's case dealt with the question of

payment of solatium as enhanced by the Amendment Act. The

real point for consideration, therefore, is whether what was

stated by Raghubir Singh's Bench regarding solatium would

apply to interest as well; and this is the point of

difference between the two leaned Judges who heard the

appeal earlier. May we state that the view taken by the

Raghubir Singh's Bench has been endorsed by the Constitution

Bench in K.S. Paripooran v. State of Kerala, JT 1994 (6) SC

182 (sec para 58, 59, 102, 106 and 107).

7. Shri Madhav Reddy, learned Sr. Advocate appearing for

the appellants, has submitted that as appellants are not

claiming enhanced interest retrospectively but from the date

of coming into force of the amending Act (September 24,

1984) what was stated in Raghubir Singh's case has no

application. We find no force in this submission inasmuch

as enhanced interest as contemplated by section 18 of the

Amending Act de hors what has been stated in sub-section (2)

of Section 30. This is for

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the reason that the Amending Act has made available the

enhanced rate only to those cases mentioned in sub-section

(2) of Section 30. The Court has no power to enlarge the

scope of this sub-section. That would be either "violence

to the statute" as put by Punchhi, J., or an act of legisla-

tion by us, which as a court we cannot undertake.

8. Let it, therefore, be seen whether, despite what was

stated in Raghubir Singh's case qua solatium, enhanced

interest can be claimed by the appellants. This aspect is

being examined by us because interest is not a part of the

award and section 30(2) of the Amendment Act deals with

awards. That interest does not form of award would appear

from a combined reading of Sections 11, 23 and 26 of the

Act. Section 111 which enjoins the Collector to make an

award, requires him to specify: (i) the true area of the

land; (11) the compensation which in his opinion should be

allowed for the land and (iii) the apportionment o the said

compensation. Section 23 deals with the matters to be

considered in determining the compensation. Sub-section (1)

requires six aspects to be taken note o which are subject

matters of six clauses o that sub-section. Sub-section (2)

of Section 23 has provided for payment colloquially known as

solatium. Section 26, which is on the subject of form o

awards, states that every award specify the amount awarded

under clause first of subsection (1) of Section 23, and also

the amounts, if any, awarded under each o the other clauses

of the same sub-section. Sub-section (2) of this section

states that every such award shall be deemed to be a decree.

9. The aforesaid clearly shows that the interest

visualised by section 28 of the Act is not a part of the

compensation, and so, not a part of award. This has also

been the view expressed by a two-Judge bench of this Court,

to which one of us (Kuldip Singh, J) was a party, in Shree

Vijay Cotton & Oils Mills Ltd. v. State of Gujarat, 1991 (1)

SCC 262. (See para 15). A combined reading of aforesaid

sections would show that solatium too is not a part of the

award inasmuch as sub-section (1) of Section 26 specifically

states that the award shall specify the amount awarded under

each of the clauses of sub-section (1) of Section 23,

whereas solatium is dealt by sub-section (2) of Section 23.

10. The aforesaid being the position, we have to hold that

what was stated in Raghubir Singh's case qua solatium shall

apply to interest also. Enhanced interest is not demanded

by a harmonious reading of relevant provisions, as opined by

Kasliwal, J., because the "Intention of the legislature"

about which the leaned Judge spoke, really shows the

contrary, according to us, as the increase was sought to be

confined (for reasons which need no examination) to the

awards made between the dates noted above, whereas the

present award is anterior to the starting point. We are,

therefore, in agreement with the view taken by Punchhi, J.

and state that the appellants are not entitled to enhanced

rate of interest as contemplated by section 18 of the

Amendment Act.

11. It has also been submitted by Shri Madhava Reddy that

higher rate of interest may be ordered to do equity between

the parties. We are unable to concede, as, had present been

a case of non-awarding of any interest, we would have done

so, because, interest in such cases may be-

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come payable on equity, for it is meant to make good the

loss suffered by a person due to delayed payment. This view

has been reiterated recently by this Court in Kalimpong Land

& Building Ltd. v. State of West Bengal, JT 1994 (6) SC 102,

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in which payment of interest was ordered, even when

acquisition was under Requisitioning and Acquisitioning of

Immovable Property Act, 1-952, which statute has made

specific provision, unlike the Act at hand, for payment of

interest. But equity has no role when the question relates

to rate o interest. Whether the rate of interest should be

6% or 9% is not a matter which would require invocation of

Court's equitable jurisdiction. The same has to be governed

by statutory provision. Had the rate of interest been too

low, we could have perhaps on equity granted some relief But

6% has been the rate for a very long period insofar as the

Act is concerned as the enhancement came only in 1984

whereas the Act is of 1894. So, we are not satisfied if

equity demands granting of relief in question.

12. This is our answer to the point referred to this bench.

The appeal may now be placed for final disposal before an

appropriate bench.

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