Bombay High Court
The State Of Maharashtra vs Madhukar Trimbak Muley And Ors on 9 January, 2025
2025:BHC-AS:844
Xobst 11357-02
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
CROSS OBJECTION (ST.) NO.11357 OF 2002
IN
FIRST APPEAL NO.176 OF 2000
The State of Maharashtra
Through the Special Land Acquisition Officer,
National Highway Project, Nashik ... Appellant.
Versus
1. Shri Madhukar Trimbak Muley
Age 63, R/o. Satpir Galli, Sinnar,
Taluka Sinnar, District Nashik
2. Shri Vasant Trimbak Muley,
Age : 58 years,
3. Shri Wasudeo Trimbak Muley,
Age 54 years,
No.2 & 3 are residents of
L-37 Javharnagar Colony,
Ratlam, State of Madhya Pradesh.
4. Smt.Sushila Vishwanath Dongare,
Age : 68 years,
R/o. Juna Tukoganj, Dongre Wada,
Indore, State of Madhya Pradesh ... Respondents.
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Mr. A.R. Patil, AGP for the Appellant-State.
Ms. Rukmini Khairnar i/by Mr. P.N. Joshi, for Respondents.
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Coram : Sharmila U. Deshmukh, J.
Reserved on : January 07, 2025
Pronounced on : January 09, 2025
JUDGMENT :
1. This Cross-objection raises issue of entitlement of interest on the
aggregate amount i.e. on solatium and component computed at 12% of
market value which has not been granted by the Reference Court.
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2. Ms.Khairnar, learned counsel appearing for the Claimants would
submit that the First Appeal filed by the State Government stands
disposed of as withdrawn and the Cross-objection survives for
consideration. She submits that the Land Reference Court did not
award interest on the Component granted under Section 23(1A) of the
Land Acquisition Act, 1894 [for short, "Act of 1894"]
and the solatium granted under Sub-Section (2) of Section 23 of the Act
of 1894. She submits that the issue is no longer res integra and as far as
the grant of interest on solatium is concerned, the Apex Court in the
case of Sunder vs. Union of India reported in AIR 2001 SC 3516 has
held that the solatium forms part of the compensation to a landowner
and the interest awardable under Section 28 of the Act of 1894 would
include the market value as well as the statutory solatium. She would
submit that the Division Bench of this Court in the case of State of
Maharashtra and Anr. vs. Chandrakant Mangilal Samdadia reported
in 2013 (1) Mh.L.J. 397, has followed decision of the Apex Court in the
case of Sunder (supra) and has held that interest under Section 28 of
the Act of 1894 is payable on the excess amount granted by the
Reference Court under all the three components of compensation i.e.
market value under Section 23(1), solatium under Section 23(2) and
interest under Section 23(1A) of the Act of 1894.
3. Per contra, Mr. Patil, learned AGP for the Appellant-State would
fairly concede to the settled position in law.
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4. The point for determination is whether the Claimants are entitled
to interest on the amounts awarded under Sub-Section (2) and Sub-
Section (1A) of Section 23 of the Act of 1894.
5. The Reference Court by judgment dated 6th March, 1998 awarded
compensation in land reference case. The Cross-objectors in Objection
(St.) No.11357 of 2002 were the Claimants in Land Reference No.844 of
1990, granted solatium at the rate of 30% of the land value and
component calculated at the rate of 12% on the land value and had
arrived at the total enhanced compensation and after deducting the
amount awarded by Special Land Acquisition Officer, has arrived at the
total amount due. The computation shows that there was no interest
awarded on the solatium of 30% granted under Sub-Section (2) of
Section 23 and on the component calculated the rate of 12% on the
market value under Sub-Section (1A) of Section 23 of the Act of 1894.
6. Section 28 of the Act of 1894 provides for payment of interest on
the excess compensation. In the case of Sunder (supra), the question
which was referred to the Constitution Bench was whether the State
was liable to pay interest on the amount envisaged under Section 23(2)
of the Act of 1894. The Apex Court approved the view taken by the
Division Bench of the Punjab and Haryana High Court in the case of
State of Haryana v. Smt. Kailashwati, reported in AIR 1980 Punj and
Har 117, which had taken the view that the solatium provided under
Section 23(2) of the Act of 1894 formed an integral and statutory part
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of the compensation awarded to the land owner and in view of Section
28 of the Act of 1894, interest is payable on the compensation awarded
and not merely on the market value of the land and therefore, the
interest awardable under Section 28 of the Act of 1894 would include
both the market value and the statutory solatium. The decision of the
Apex Court, thus, settles the issue as regards the payment of interest
on the solatium granted under Section 23(2) of the Act of 1894 and
interest is bound to be paid under Section 28 of the Act of 1894 on the
amount of solatium.
7. The Division Bench of this Court in the case of Chandrakant
Mangilal Samdadia (supra) followed the decision in the case of Sunder
(supra) to hold that the interest under Section 28 of the Act of 1894 is
payable on the excess amount granted by the Reference Court under
all the three components of compensation i.e. market value under
Section 23(1), solatium under Section 23(2) and interest under Section
23(1A) of the Act of 1894. It was held that whenever an enhancement
of compensation is granted by the Reference Court in a Reference
under Section 18 of the Act of 1894, the Claimants are entitled to
interest under Section 28 of the Act of 1894 on all three components as
a matter of right.
8. In light of the settled position in law the issue is answered in the
affirmative. The Claimants are entitled to interest on the solatium
granted under Sub-Section (2) of Section 23 and the component
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calculated at the rate of 12% p.a. on the market value under Sub-
Section (1A) of Section 23, as per Section 28 of the Act of 1894.
9. In view of the above, the following order is passed:
: ORDER :
(i) The Cross-Objection stands allowed.
(ii) The Executing Court is directed to calculate interest on
the amount granted under Sub-Section (1A) of Section 23
and Sub-Section (2) of Section 23, as per Section 28 of the
Land Acquisition Act, 1894 in light of the observations
made in the present judgment.
(iii) Award to be drawn accordingly.
[Sharmila U. Deshmukh, J.]
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Signed by: Sanjay A. Mandawgad
Designation: PA To Honourable Judge
Date: 09/01/2025 16:19:05
