Jivan Bharati Mandal vs Surat Municipal Corporation
2022 Latest Caselaw 1595 Guj

     C/SCA/6589/2016                               JUDGMENT DATED: 11/02/2022




             IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

               R/SPECIAL CIVIL APPLICATION NO. 6589 of 2016


FOR APPROVAL AND SIGNATURE:


HONOURABLE MR. JUSTICE A.Y. KOGJE                    Sd/-
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1     Whether Reporters of Local Papers may be allowed                   No
      to see the judgment ?

2     To be referred to the Reporter or not ?                            No

3     Whether their Lordships wish to see the fair copy                  No
      of the judgment ?

4     Whether this case involves a substantial question                  No
      of law as to the interpretation of the Constitution
      of India or any order made thereunder ?

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                       JIVAN BHARATI MANDAL & 3 other(s)
                                   Versus
                        SURAT MUNICIPAL CORPORATION
================================================================
Appearance:
MS KJ BRAHMBHATT(202) for the Petitioner(s) No. 1,1.1,1.2
MS VARSHA BRAHMBHATT(3145) for the Petitioner(s) No. 1,1.1,1.2
POOJA H BHARDWAJ(7844) for the Petitioner(s) No. 1,1.1,1.2
MR HS MUNSHAW(495) for the Respondent(s) No. 1
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    CORAM:HONOURABLE MR. JUSTICE A.Y. KOGJE

                               Date : 11/02/2022

                               ORAL JUDGMENT

1. RULE. Learned advocate Mr. H.S.Munshaw waives

service of rule on behalf of respondent-corporation.

2. This petition is filed against the judgment and order

dated 04.02.2016 passed by the 9th Additional District Judge, Surat

C/SCA/6589/2016 JUDGMENT DATED: 11/02/2022

in Regular Civil Appeal No.13 of 2004 by which the interest

calculated was called in question.

3. The issue pertains to entitlement of the petitioners

claim of interest at the rate of 12% per annum, whose land was

acquired for the purpose of widening of the road. The corporation

through its Commissioner had awarded the amount of

compensation, against which the Municipal Reference was

preferred by the petitioners and the Principal Senior Civil Judge,

Surat decided the reference.

3.1 The reference was subject matter by separate appeals

preferred both by the claimants as well as the Surat Municipal

Corporation and by common judgment, the respective appeals

came to be decided. Each appeal filed by the claimant and the

municipal corporation was decided by a common judgment hence,

the petitioners have preferred this writ petition.

4. The present petition pertains to property bearing Ward

No.1 Nondh No.1380, Final Plot No.18, situated at Timliawad,

Nanpura, Surat, where land admeasuring 415.3895 sq. mtrs came

to be acquired widen the road by the Surat Municipal Corporation

under Section 210 read with Section 212(2) of the Act. The

Commissioner on 03.03.1990 under Section 390 awarded the

compensation for the land is Rs.1640/- per sq.mtr.

4.1 Thereafter, the petitioners filed Municipal Reference,

C/SCA/6589/2016 JUDGMENT DATED: 11/02/2022

which was partly allowed vide order dated 05.05.2000, whereby

granted compensation of Rs.5,000 per sq.mtr with interest at the

rate of 12% per annum.

4.2 Thereafter, against the aforesaid order, the respondent

Corporation preferred Regular Civil Appeal No.13 of 2004 before

the District Court, Surat and challenged grant of rate of interest.

The said appeal was partly allowed by judgment and order dated

04.02.2016 and reduced the rate of interest to 9%.

5. Learned advocate for the petitioners submitted that the

lower appellate Court has committed grave error by reducing the

rate of interest from 12% per annum awarded by the Reference

Court to 9% per annum on the ground that it is excessive. It is

submitted that in a different proceedings regarding road widening,

Principal Senior Civil Judge, Surat vide judgment and order dated

29.09.2008 in Municipal Reference No.5 of 1997, awarded rate of

interest at 15% per annum and against the said award, the

respondent-Municipality has preferred Regular Civil Appeal No.30

of 2010, wherein the District Court at Surat reduced the rate of

interest at 12% per annum from 15% per annum. The respondent-

Corporation accepted the said judgment and no further

proceedings were filed by the SMC against the said judgment.

Hence, the petitioners are also entitled to receive interest at least

at the said accepted rate of interest being 12% by respondent-

Corporation. It is submitted that with widening of the road, the

C/SCA/6589/2016 JUDGMENT DATED: 11/02/2022

petitioners have lost valuable property under compulsory

acquisition.

6. With regard to the interest awarded by the appellate

Court at the rate of 9%, learned Advocate for the petitioners

referred to judgment in Regular Civil Appeal No.30 of 2010, where

the appellant is the Surat Mahanagarpalika and in this judgment,

the appellate Court has reduced the interest rate awarded by the

Reference Court from 15% to 12% and that the interest rate of 12%

was accepted by the Surat Municipal Corporation and therefore, in

the present case, where the interest rate is reduced to 9% by the

appellate Court from what was awarded by the Reference Court at

12%, is required to be interfered with.

7. As against this, learned Advocate for the respondent-

Corporation submitted that the judgment and order of the appellate

Court is just and proper and the Court has considered every aspect

of the matter while awarding interest at the rate of 9% and no

interference is called for.

8. The Court has considered the submissions made by

learned advocates and perused the documents placed on record.

The issue raised before this Court in the petition during the course

of arguments is that of reduction in the rate of interest by the

appellate forum from 12% awarded in the Municipal Reference to

9% awarded by the Appellate Court.

C/SCA/6589/2016 JUDGMENT DATED: 11/02/2022

9. In the present case, the details regarding acquisition

proceedings and the compensation awarded at various stages are

already recorded in the preceding paras.

10. The acquisition was proposed under Section 210 read

with Section 212 of the Act and after following due procedure, an

award was passed by the Commissioner under Section 390 of the

Act. From the record, it appears that while passing the award, all

necessary provisions of law were complied with and there is no

challenge in so far as procedural aspect is concerned.

11. Alongwith the compensation, the reference Court also

decided upon the rate of interest by calculating the same at the

rate of 12%. The respondent-Corporation challenged the judgment

and order of the reference Court for awarding higher rate of

interest at the rate of 12%. While allowing the appeal of the

respondent-Corporation, the appellate Court reduced the rate of

interest from 12% to 9%.

12. The Municipal Reference Court granted the

compensation with rate of interest of 12%. In the appeal, the

appellate forum maintained the compensation, but reduced the rate

of interest to 9%. The Court has taken into consideration the issue

of interest in two aspects. The first being the rate of interest and

other being the date from which such rate of interest is to be

calculated. Insofar as the rate of interest is concerned, the

C/SCA/6589/2016 JUDGMENT DATED: 11/02/2022

Reference Court has awarded the rate of 12% interest from the

date of taking the possession which was reduced by the appellate

Court to 9%. Not only that, the appellate Court has also made the

rate of interest applicable from the date of order of the Reference

Court.

13. The only submission made by the petitioners is that the

respondent-Corporation in one of the proceedings of similar kind of

acquisition for road widening has accepted the award of the

Appellate Court, which has reduced the interest from 15% per

annum to 12% per annum and therefore, in the present case, the

interest rate of 9% granted by the appellant Court may not be

enhanced to at the rate of 15% as granted by the Reference Court,

but at least should be increased to 12%. The proceedings under

the BPMC Act are governed by the separate statute which is

different from the provisions of Land Acquisition Act, where the

rate of interest is provided under the acquisition itself. The

proceedings of acquisition under the BPMC Act will have to be

governed by the Code of Civil Procedure as provided for under

Section 434. Section 434 of the Gujarat Provincial Municipal

Corporation Act provides for application of Civil Procedure Code

and Sub-Section 2 provides for application of the same to all other

matters for which no specific provision has been made under this

Act which shall be governed by such Rules, as the State

Government may from time to time make after consultation with

C/SCA/6589/2016 JUDGMENT DATED: 11/02/2022

the High Court. There is no provision with regard to the interest in

GPMC. However, Section 34 of the CPC would apply which

provides for the rate of interest, not exceeding 6% per annum.

However, as the respondent-Corporation is not challenging the rate

of interest as prescribed by the appellate Court, the Court is not

inclined to interfere with to change the rate of interest. On the

challenge made by the claimants to enhance the rate of interest

from 9% to 12% or 15%, no interference is called for in so far as

the rate of interest is concerned.

14. With regard to the aspect of period of applicability of

the rate of interest, the relevant date, as per the opinion of the

Court, would be the date on which the possession is taken over.

The reason for interfering to the limited extent is the Reference

Court has granted the rate of interest from the date of taking the

possession by assigning cogent reasons. However, when the

appellate Court reduced the period from the date of taking over the

possession to the date on which the Reference Court had

pronounced the judgment and order, no reasons had been adduced

in doing so and therefore, by maintaining the judgment and order

in this regard by the Reference Court, this Court is of the view that

the rate of interest of 9% may be applicable from the date of taking

over of possession. The petitioners are therefore entitled to receive

interest at the rate of 9% from the date of taking of possession of

the lands of petitioners.

C/SCA/6589/2016 JUDGMENT DATED: 11/02/2022

15. Learned Advocate for the respondent-Corporation has

made a feeble attempt to argue that the nomenclature in the

petition indicates the petition being filed under Art.227 of

Constitution of India and therefore the scope of interference for

this Court is limited. In view of the discussion in the foregoing

paras, it is apparent that the judgment and order of the appellate

Court is final and there is no statutory provision to agitate the

grievance. Moreover, the error is committed by the subordinate

Court where on one hand has accepted on record the evidence of

Govt Jantri to decide the market value but does not take the same

in consideration while giving weightage to a sale instance.

therefore the court deems it fit to interfere.

16. It is also pertinent to refer to the decision of this Court

in SCA Nos.2604 of 2016 with SCA No.2615 of 2016, which also

raise identical issues and have been disposed of by this Court by

judgment and order dated 20.01.2022 on the same line.

17. With the aforesaid extent, the petitions stand partly

allowed. Rule is made absolute to the aforesaid extent. No order

as to costs.

Sd/-

(A.Y. KOGJE, J) SHITOLE