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PETITIONER:

NARAIN DAS JAIN (SINCE DECEASED) BY L.RS.

Vs.

RESPONDENT:

AGRA NAGAR MAHAPALIKA, AGRA

DATE OF JUDGMENT14/02/1991

BENCH:

PUNCHHI, M.M.

BENCH:

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.

HEADNOTE:

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

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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.

JUDGMENT:

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.

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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

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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

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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

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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.

396