Bombay High Court
Mr. Nagnath Raynarasu Porandla vs The Competent Authority And ... on 6 April, 2023
Bench: R.D. Dhanuka, Gauri Godse
2023:BHC-AS:10334-DB
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Iresh IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 1910 OF 2022
1. Roshanbi Aziz Motiwala through
power of attorney holder
Mr. Iliyas Aziz Motiwala
Age - 47,Occu.Business
R/o-131, Siddheshwar Peth
Opp.Civil Court, Solapur-413 003
2. Mr. A. Gaffar Haji Papamiya Shaikh
Age-68 years, Occ. Business
R/o-Shop No. 2, Lokhandwala Complex,
Hyderabad Road, Solapur-413 006
3. Mr. Shaukatali Kashimsab Haptewale
Age-49 years, Occ. Business
R/o. Shop No. 1, Lokhandwala Complex,
Hyderbad Road, Solapur-413 006
4. Mr. Abdul Razzak Idris Siddhiqi
Age-51 years, Occ. Business
R/o. Shop No. 13, Lokhandwala
Complex,
Hyderbad Road, Solapur-413 006
5. Mr. Haji Masoomali Shaikh
Age-62 years, Occ. Business
R/o. Shop No. 12, Lokhandwala
Complex,
Hyderbad Road, Solapur-413 006
6. Mr. Gafur Maktumsab Shaikh
Age-57 years, Occ. Business
R/o. 130, Railway Line, Solapur-413 001
7. Mr. Mahemood Ali Pajanigarr
Age-71 years, Occ. Business ... Petitioners
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R/o. Shop No. 3, Lokhandwala Complex,
Hyderbad Road, Solapur-413 006
vs.
1. The Competent Authority and Deputy
Collector, Land Acquisition Officer No. 11
(CALA)
Krushna Khore, Solapur, New
Administrative Building, 2nd Floor,
Collector Office Compound,
Solapur-413 001
2. The Collector of Solapur,
Solapur-413 001.
3 The Project Director,
The National Highway Authority of India
Solapur Plot No. E-2, Jai Jalaram Nagar ... Respondents
Behind Shivdare College
Jule Sholapur-413 004
WITH
WRIT PETITION NO. 1911 OF 2022
1. Mr Nagnath Raynarasu Porandla
Partner of M/s. Narmada Developers
Age - 63 years, Occ. Business
R/o. Narmada Complex, Shelagi
Hyderabad Road, Solapur-413 006 ... Petitioner
vs.
1. The Competent Authority and Deputy
Collector, Land Acquisition Officer No. 11
(CALA)
Krushna Khore, Solapur, New
Administrative Building, 2nd Floor,
Collector Office Compound,
Solapur-413 001
2. The Collector of Solapur,
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Solapur-413 001.
3 The Project Director,
The National Highway Authority of India
Solapur Plot No. E-2, Jai Jalaram Nagar
Behind Shivdare College ... Respondents
Jule Sholapur-413 004
Dr. Ramdas P. Sabban a/w Mr. Praveen Sabban, Mr. Shrikant
Kompelli and Ms. Arundhati Sabban for Petitioners in both Petitions.
Mr. V. S. Gokhale 'B' Panel counsel for Respondent Nos. 1 and 2 in
both Petitions.
Mr. Rakesh Singh a/w Ms. Heena Shaikh i/b M. V. Kini and Co. for
Respondent No. 3-NHAI in both Petitions.
CORAM : R. D. DHANUKA AND
GAURI GODSE, JJ.
RESERVED ON : 08 MARCH, 2023
PRONOUNCED ON : 06 APRIL, 2023
JUDGMENT: (PER: GAURI GODSE, J.)
1. Rule. Mr. Gokhale waives service on behalf of Respondent
Nos. 1 and 2, and Mr. Singh waives service on behalf of
Respondent No. 3. Rule is made returnable forthwith. By consent of
the parties, Petitions are taken up for final disposal. Since the issue
involved in both Petitions is the same, both Petitions are disposed of
by a common Judgment.
2. Both Petitions are filed under Article 226 of the Constitution of
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India, seeking directions for quashing and setting aside the order
dated 20th January 2020 passed by Respondent No. 1-Competent
Authority under the National Highways Act, 1956 ("said Act of
1956"). Petitioners have further prayed for 15% per annum equitable
interest from the date of the Award passed under Section 3(G) of
the said Act of 1956 till the date of payment. In the alternative, the
Petitioners prayed for grant of statutory interest from the date of
possession till the date of actual payment.
3. It is contended by the Petitioners in Writ Petition No. 1910 of
2022 that on 15th July 2017, by a supplementary award/order
passed under Section 3(G) of the said Act of 1956, compensation
for an amount of Rs. 1,08,92,995/- was awarded with respect to the
building/structures of the Petitioners, on the acquired land.
Petitioner in Writ Petition No. 1911 of 2022, contended that on 21 st
April 2015, by an award/order passed under Section 3(G) of the said
Act of 1956, compensation for Rs 1,01,88,000/- was awarded for
Petitioner's land. It is the grievance of the Petitioners in both the
Petitions that though the compensation amount was paid to the
Petitioners, they had not been paid interest on the amount
determined by the Competent Authority under the Award from the
date of declaration of Award till the date of payment of the amount of
compensation.
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4. The Petitioners in Writ Petition No. 1910 of 2022 had filed
Writ Petition No. 6871 of 2018, and Petitioner in Writ Petition No.
1911 of 2022 had filed Writ Petition No. 6894 of 2018. The said
Petitions were decided along with other connected Petitions on 14 th
January 2019. This Court had granted liberty to the Petitioners to file
appropriate Application to the Competent Authority for the interest
claim. Accordingly, Petitioners in both the Petitions had filed their
respective Applications for claiming interest. The said claim for grant
of interest is rejected by the Competent Authority by an order dated
20th January 2020. Hence, the Petitioners have filed present Writ
Petitions.
5. Learned counsel appearing for the Petitioners submitted that
the Petitioners are entitled to interest on the amount awarded under
the Award from the date of Award till the date of payment. The
Petitioners have also made an alternative prayer for the grant of
statutory interest from the date of possession till the date of actual
payment. It is further contended that the Competent Authority was
under obligation to immediately disburse the amount after passing
the Award. In support of the submissions made for grant of interest,
the learned Advocate for the Petitioners has relied upon the
following decisions:
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(i) Shivkumar Shamrao Atulkar Vs. Union of India
thr. the Secretary Ministry of Shipping and Ors.1
(ii) Kisan (Krishnaji) Aba Kamble since deceased
through Legal heir and others Vs. The State of
Maharashtra through Secretary and another.2
(iii) Shri. Uday S. Vaidya and another Vs. State of
Goa and another.3
(iv) Major General Kapil Mehra and others Vs.
Union of India and another.4
(v) State of Maharashtra Vs. Kailash Shiva
Rangari.5
(vi) Vasant Balkrishna Wale Vs. Vithal Mahadeo
Deshmukh & Ors.6
(vii) Union of India Vs. Tarsem Singh and others.7
(viii) Delhi Development Authority Vs. Sukhbir
1 Writ Petition No. 996 of 2017, decided on 23/02/2018, Bombay High Court, Nagpur Bench
2 Writ Petition No. 624 of 2022, decided on 04/03/2022. Bombay High Court
3 Supreme Today 2003 0 Supreme (Bom) 657
4 (2015) 2 Supreme Court Cases 262
5 2016 (4) Bom. C.R. 1
6 2006 (1) Bom. C.R. 669
7 (2019) 9 Supreme Court Cases 304
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Singh and others.8
6. Learned counsel appearing for the Petitioners by relying upon
the aforesaid decisions submitted that the Petitioners are entitled to
interest as claimed by them. He further submitted that the Right to
Fair Compensation and Transparency in Land Acquisition,
Rehabilitation and Resettlement (Removal of Difficulties) Order
under section 105 (3) dated 28th August 2015, which came into force
from 1st September 2015, provided that the provisions of The Right
to Fair Compensation and Transparency in Land Acquisition,
Rehabilitation and Resettlement Act, 2013 ("the said Act of 2013")
relating to the determination of the compensation in accordance with
the First Schedule, Rehabilitation and Resettlement in accordance
with the Second Schedule and infrastructure amenities in
accordance with the Third Schedule shall apply to the enactments
relating to land acquisition specified in the Fourth Schedule with
effect from 1st January 2015.
7. Learned counsel for the Petitioners submitted that the ratio
laid down by this Court and the Hon'ble Supreme Court in the
aforesaid decisions squarely applies to the facts of the present
case. Hence, the Petitioners are entitled to grant of interest on the
8 AIR 2016 Supreme Court 4275
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amount awarded under the Award under Section 3(G) of the said
Act of 1956 from the date of the Award till the actual payment.
8. In Writ Petition No. 1910 of 2022, an affidavit-in-reply was
filed on behalf of Respondent No. 3-National Highways Authority of
India ("NHAI"). It is contended that the Award in question is dated
15th July 2017, and the notice to collect the Award amount was
issued to the respective owners on 28th September 2017.
Subsequently, Petitioners claimed the compensation amount in
February/March 2018, and the payment was released in
February/March 2018. Thus, it was contended that since the
payments were released immediately, Petitioners are not entitled to
grant of any interest as prayed. There is an affidavit-in-reply filed on
behalf of Respondent Nos. 1 and 2-Competent Authority.
9. It is contended on behalf of Respondent Nos. 1 and 2 that
after the passing of the Award, the valuation of the structures on the
land was unavailable. Therefore, the Award with respect to the
structures on the acquired land was not passed. After receipt of the
valuation report, Respondent No. 1 passed the supplementary
Award on 15th July 2017 with respect to the building structures on
the land under acquisition. After passing the supplementary Award,
dated 15th July 2017, Respondent No. 1, by letter dated 17 th July
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2017, informed Respondent No. 3-acquiring body, regarding the
Award and the compensation amount to be deposited in the ledger
account. Copy of said letter dated 17th July 2017 and letter dated
27th September 2017 issued by NHAI intimating deposit of the
amount are annexed to the affidavit-in-reply filed on behalf of
Respondent Nos. 1 and 2.
10. It is further contended that thereafter, Respondent No. 1 issued
notice to the respective persons on 28th September 2017, and the
Petitioners also received the notice on the same day. It is further
contended that the Petitioners had received the compensation
amount and 100% solatium regarding the building structures on the
acquired land. Hence, Respondents are not liable to pay interest
from 15th July 2017 to March 2018 as claimed by the Petitioners.
11. In Writ Petition No. 1911 of 2022, an Affidavit in Reply was
filed on behalf of Respondent Nos. 1 and 2. It is contended that after
passing an Award on 21st April 2015, notice under Section 3(G)(1)
(2), 3(H)(2)(3), and 3(E)(1)(2) of the said Act, 1956 was issued to
the Petitioner on 10th August 2015 calling upon him to receive the
compensation amount and the Petitioner received the same. It is
further contended that on 23rd March 2018, the Petitioner received
the compensation amount.
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12. It is further contended that by letter dated 21 st April 2015, the
Competent Authority had informed Respondent No.3-Acquiring
Body, regarding the Award and the compensation amount to be
deposited in the ledger account and that the same was deposited on
the same day. Hence, it is the submission on behalf of Respondent
No.1 that the Petitioner is not entitled to claim any interest amount
as prayed. Respondent No.3, Acquiring Body, has not filed any
affidavit in reply to Writ Petition No. 1910 of 2022.
13. Thus, a short issue involved in these Petitions is about the
entitlement of the Petitioners to receive interest on the
compensation awarded under the Award from the date of the Award
until the actual payment. The date of the Award and the date of the
actual payment is not disputed. Learned counsel appearing for the
Petitioners has invited our attention to the calculation of interest
given in the table submitted on behalf of the Petitioners.
14. We have considered the submissions made on behalf of the
parties. The Hon'ble Supreme Court, in the case of Tarsem Singh,
has held that in view of the Right to Fair Compensation and
Transparency in Land Acquisition, Rehabilitation and Resettlement
(Removal of Difficulties) Order, 2015 it is clear that the Central
Government has considered it necessary to extend the benefit
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available to land owners under the Act of 2013 to the similarly
placed land owners whose lands are acquired under the said Act of
1956 being one of the enactments specified in the Fourth Schedule
of the said Act of 2013.
15. The Hon'ble Supreme Court, in the said decision of Tarsem
Singh, has further held that it is clear that even the Government is of
the view that it is not possible to discriminate between land owners
covered by the said Act of 2013 and land owners covered by the
said Act of 1956 when it comes to compensation to be paid for lands
secured under either of the enactment. The Hon'ble Supreme Court
has, by the said decision, declared that the provisions under the
Land Acquisitions Act relating to Solatium and interest contained in
Section 23(1-A) and (2) and interest payable in terms of Section 28
proviso will apply to an acquisition made under the said Act of 1956
and consequently declared the proviso of Section 3-J of the said Act
of 1956 violative of Article 14 of the Constitution of India to that
extent being unconstitutional.
16. So far as the contention of the learned counsel for the
Petitioners regarding applicability of the said Act of 2013 to the
acquisitions made under the said Act of 1956 is concerned, by the
Right to Fair Compensation and Transparency in Land Acquisition,
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Rehabilitation and Resettlement (Removal of Difficulties) Order,
2015, the provisions of the said Act of 2013, relating to the
determination of compensation in accordance with the First
Schedule, rehabilitation and resettlement in accordance with the
Second Schedule and infrastructure amenities in accordance with
the Third Schedule are made applicable to all cases of land
acquisition under the said Act of 1965. Thus, the provisions
regarding interest under sections 37, 72 and 80 of the said Act of
2013 are not made applicable to the said Act of 1956.
17. The said Act of 1956 does not lay down a statutory outer limit
for the deposit of the compensation amount. However, it must be
done within a reasonable time as vesting takes place on a
declaration being made under Section 3-D(1) of the said Act of
1956. The unreasonable delay in deposit/payment of the
compensation amount to the person interested will attract the vice of
arbitrariness which is hit by Article 14 of the Constitution. It cannot
be countenanced that a person is deprived of his/her land by
compulsory acquisition but does not get compensation though it is
already determined. Therefore, in public law remedy under Article
226, Writ Court can always direct the authority to compensate the
landowner for the delay by directing payment of a reasonable
interest on compensation. In the same situation, a person whose
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land is compulsorily acquired either under the said Acts of 1894 or
2013, will get interest at the rate of 9% for one year from the date of
dispossession and for the further period, at 15%. Therefore, in the
facts of the present case, the petitioner must get at least 9%
interest.
18. Learned counsel for the Petitioners has relied upon the
decision of this Court in the case of Shivkumar Shamrao Atulkar . In
the said case, this Court dealt with the provisions of the said Act of
1956. In the said decision, this Court, by relying upon the National
Highways (Manner of Depositing the amount by the Central
Government with the Competent Authority for Acquisition of land)
Rules, 1998, ("said Rules of 1998") held as under:-
"On hearing the learned counsel for the parties
and on a perusal of Rule 2 of the Rules of 1998, it
appears that a duty is enjoined upon the Central
Government to deposit the amount payable to land
holder towards compensation with the competent
authority. The competent authority, in turn, is enjoined
with the duty to deposit the amount received by it from
the Central Government or the acquiring body in a
separate Public Deposit Account. For any reason like
the reason in this case, if the amount cannot be paid to
a land holder immediately on the deposit of the same
by the Central Government or the acquiring body, the
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claimant would be entitled to receive interest on the
delayed payment of compensation. In this case, we
cannot blame any of the Respondents in the delay in
payment of the compensation to the petitioner as there
was a dispute in regard to the title to the property
between the petitioner and three others. After the
dispute was resolved, the petitioner received
compensation on 30th January, 2015. The petitioner
ought to have received the compensation by
November 2012 if there was no dispute about the title
to the land.
In this background, considering the fact that the
competent authority is required to deposit the amount
of compensation in a separate Public Deposit Account,
it would be necessary for the respondents to pay
interest to the petitioner at least at the rate of interest
that is fetched on the fixed deposit accounts in the
nationalized bank. According to the petitioner, the
interest rate payable by the nationalized banks on the
fixed deposits, at the relevant time was approximately
8.75 % per annum. If that is so, in the circumstances of
the case it would be necessary to direct the
respondents to pay interest to the petitioner on the
delayed payment of compensation of Rs 24,78,000/- at
the rate of 9% per annum from 1st November, 2012 to
30th January, 2015.
Hence, for the reasons aforesaid, the writ
petition is partly allowed. The respondents are directed
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to pay interest at the rate of 9% per annum on the
amount of compensation of Rs. 24,78,000/- for the
period from 1st November, 2012 till 30th January, 2015
as early as possible and positively within three
months".
19. In case of Shivkumar Atulkar , this Court has held that for any
reason, if the amount cannot be paid to the landholder immediately
on depositing of the same by the Central Government or Acquiring
Body, the claimant would be entitled to receive interest on the
delayed payment of compensation. This Court, by relying upon Rule
2 of the said Rules of 1998, has held that the Claimant would be
entitled to interest at the rate of 9 % per annum on the amount of
compensation for the delayed payment. Rule 2 of the said Rules of
1998 prescribed the manner of depositing the money with the
Competent Authority. In supersession of the said Rules of 1998,
except with respect to things done or to be done before such
supersession, the Central Government has made similar new Rules
being the National Highways (Manner Of Depositing The Amount By
Central Government; Making Requisite Funds Available To The
Competent Authority For Acquisition Of Land) Rules 2019 ("said
Rules of 2019").
20. Rule 3 of the said Rules of 2019 provides for the manner in
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which requisite funds available to the Competent Authority are to be
deposited. The said Rules of 2019 came into force on 18 th January
2019. Hence, in the present case, the Competent Authority was
required to deposit the amount received from the Acquiring
Body/NHAI in a separate public deposit account as per the said
Rules of 1998. The Affidavit in Reply filed on behalf of Respondent
Nos. 1 and 2 shows that in both the Writ Petitions, the amount was
deposited in the ledger account. Thus, the view taken by this Court
in the case of Shivkumar Atulkar, squarely applies to the facts of
both Petitions.
21. In Writ Petition No. 1910 of 2022, the Affidavit in Reply filed on
behalf of Respondent Nos. 1 and 2 shows that as per the
supplementary award dated 15th July 2017, the amount of
compensation was deposited in the ledger account as per the letter
dated 27th September 2017, issued by NHAI. In Writ Petition No.
1911 of 2022, the Affidavit in Reply filed on behalf of Respondent
Nos. 1 and 2 shows that as per Award dated 21st April 2015, the
compensation amount was deposited in the ledger account on the
same day. There is no dispute with respect to the aforesaid dates of
deposit placed on record by way of Affidavit in Reply filed on behalf
of Respondent Nos. 1 and 2 in both the Petitions.
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22. So far as the contention on behalf of Respondent Nos. 1 and
2 regarding issuance of notice to the Petitioners calling upon to
receive the compensation amount is concerned, neither a copy of
such notice nor any proof of service of notice is produced on record.
Hence, there is no merit in the Respondent's contention that, as
notice to receive compensation was issued, the Petitioners are not
entitled to claim interest on the delayed payment. There is no
material produced on record in both the Petitions to show that by
serving a notice within a reasonable time from the date of the
award, the Petitioners were called upon to receive the
compensation amount. Hence, in these two cases, there is a time
gap of more than seven months in Writ Petition No. 1910 of 2022
and around three years in Writ Petition No. 1911 of 2022 in payment
of compensation.
23. The submissions made by the learned counsel for the
Petitioners with respect to the alternative prayer of the Petitioners
with respect to the grant of statutory interest from the date of
possession till the date of actual payment are not required to be
dealt with in view of the prayer made by the Petitioners in the
application made by them for grant of interest pursuant to liberty
granted by this Court by order dated 14th January 2019 passed in
Writ Petition No. 6871 of 2018 and Writ Petition No. 6894 of 2018.
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Pursuant to the liberty granted by this Court, the Petitioners had
filed their respective application claiming interest from the date of
award till the date of actual payment. The Competent Authority by
the Order impugned in both the Writ Petitions have rejected the
claim of interest made by the Petitioners. Hence, the question to be
decided in both the present Writ Petitions is only with respect to the
Petitioners' entitlement for grant of interest from the date of award till
the date of actual payment.
24. The other decisions of this Court and the Hon'ble Supreme
Court relied upon by the Petitioners lays down the principles for the
grant of interest on compensation awarded under the Acts of 1894
and the said Act of 1956. Hence, the same are not required to be
dealt with separately.
25. We have perused the impugned order by which Respondent
No. 3-Competent Authority has rejected the claim of interest made
on behalf of the Petitioners. Respondent No. 3 has held that no
objection was received to the compensation amount awarded.
Hence, in view of Section 77 of the said Act of 2013 and Section
3(H)(4) of the Act of 1956, there was no question of depositing the
amount of compensation in the Court. Hence, it is held that the
Petitioners are not entitled to receive any interest on the amount of
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compensation from the date of Award till the date of actual payment
of compensation amount. The reasons given by the Competent
Authority for rejecting the claim for interest are erroneous and liable
to be set aside.
26. It is not disputed that after the original Award was passed,
though the Petitioners had received compensation, they were not
paid any interest. Since the Petitioners have not been granted any
interest and there is a delay in the actual payment of compensation
amount from the date of respective Awards in both the Petitions, the
Petitioners, in our view, would be entitled to interest from the date of
Award till the date of actual payment. Thus, in the facts and
circumstances of both the Writ Petitions and for the reasons
recorded above, it would be necessary to direct the Respondents to
pay interest to the Petitioners on the delayed payment of
compensation at the rate of 9 % per annum from the date of award
till the date of actual payment.
27. Hence, we pass the following order:
i) The order dated 20th January 2020 passed
by Respondent No. 1 is quashed and set
aside.
ii) Respondents are directed to pay interest at
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the rate of 9% per annum on the amount of
compensation to the Petitioners from the
date of Award till the date of actual payment.
iii) Respondent Nos. 1 and 2 are directed to
make payment of the amount of interest after
necessary calculations within 4 weeks from
today. Respondent No. 3 is directed to
disburse the payment towards the interest
amount within 4 weeks thereafter.
iv) Writ Petition is allowed. Rule is made
absolute in the above terms.
v) There will be no order as to costs.
vi) All parties to act on the authenticated copy of
this order.
(GAURI GODSE, J.) (R. D. DHANUKA, J.)
