JUDGMENT
M.R. Calla
1. This Special Civil Application under Article 226 of the Constitution of India has been filed by the two petitioners, Shri Gulam Hussein Sarigat and Shri Ibrahim Ismail Panchbhaya. The petitioner No.1 claiming to be the owner of the land bearing Block No.83 and 84 admeasuring 3 Hectares 44 Are and 88 Sq.Mtr. at village Jethali and Survey No.164 admeasuring 1 Hectares 23 Are and 43 Sq. Mtr. of village Sangpor, taluka Ankleshwar, district Bharuch and the petitioner No.2 claiming to be the owner of the land bearing Sruvey No.174 admeasuring 1 Hectare 81 Are 10 Sq. Mtrs. of land at village Sangpor taluka Ankleshwar, district Bharuch, have filed this Special Civil Application stating that a proposal was made for acquisition of the aforesaid lands of the petitioners for respondent No.2, i.e. Gujarat Industrial Development Corporation. For this purpose, a notification under Section 4 of the Land Acquisition Act, 1894 was issued on 11.6.1981 and the same was amended later on and the amended notification under Section 4 was issued on 28.11.1981. It is the case of the petitioners that this notification was duly published in the Government Gazette and, after considering the objections and the report made under Section 5A, a notification under Section 6 was issued on 22.11.1983 and the amended notification under Section 6 was issued on 23.2.1984. Whereas the respondent No.2-GIDC was under urgent need of lands, the possession of the lands was sought to be taken even before passing of the award through private negotiations and the petitioners and the GIDC entered into an agreement on 7.2.1983 and on the same date, i.e. 7.2.1983, the GIDC took over the possession of the aforesaid lands. As per this agreement, the respondent No.2-GIDC agreed to pay a sum of Rs.17,188/- per hectare by way of interim compensation to the petitioners. However, the petitioners did not agree to the same and, therefore, the parties agreed that the compensation will be paid in terms of the award which may be passed by the Officer on Special Duty (Land Acquisition) at Ahmedabad, i.e. respondent No.1, and further that the petitioners would be entitled to make reference to the District Court under the provisions of the Land Acquisition Act and it was further agreed between the parties that the amount of Rs.27,188/- per hectare will be accepted by the petitioners under protest and as per Clause 3 of the said agreement dated 7.2.1983, the petitioners would be entitled to get interest as per the provisions of the Land Acquisition Act, which at the relevant time was 4-1/2% per annum, till the date of the award. A copy of this agreement dated 7.2.1983 has been placed on record at Exh.4 with the petition. Thus, there is no dispute about the factum of the possession being handed over and taken over on 7.2.1983, the terms of the agreement as aforesaid and the acceptance of the amount of interim compensation under protest by the petitioners.
2. It is the further say of the petitioners that the respondent No.1 then passed the award on 12.8.1986 and in terms of the said award, as per Clause 12, the acquiring body, i.e. respondent No.2, was to pay interest for the period between the date of taking the possession and the date of the award on the amount of difference. On the basis of the interpretation of the terms of this award dated 12.8.1986, the petitioners submit that they are entitled to get the amount of interest on the amount of difference from the date of the possession till the date of the award as per the provisions of the Land Acquisition Act.
3. After the date of the agreement and the date on which the possession of the lands was handed over and taken over, i.e. 7.2.1983, and before the date of the award, i.e. 12.8.1986, the Land Acquisition (Amendment) Act (Act 68 of 1984), 1984 came into force on 24.9.1984. Section 30 of the Land Acquisition (Amendment) Act, 1984 provides for the transitional provision which reads as under:
" THE LAND ACQUISITION (AMENDMENT) ACT, 1984 (No.68 of 1984) (See SEcs. 15,18,23 and 28) (24th September, 1984) An Act further to amend the Land Acquisition Act, 1894. Be it enacted by Parliament in the Thirty-fifth Year of Republic of India as follows: 1. Short title- This Act may be called the Land Acquisition (Amendment) Act, 1984. 30. Transitional provision -(1) The provisions of sub-section (1-A) of Sec.23 of the principal Act, as inserted by Cl.(1) of Sec.15 of this Act, shall apply, and shall be deemed to have applied, also to, and in relation to,- (a) every proceeding for the acquisition of land under the principal Act pending on the 30th day of April, 1982 [the date of introduction of the Land Acquisition (Amendment) Bill, 1982, in the House of the People] in which no award has been made by the Collector before that date; (b) every proceeding for the acquisition of any land under the principal Act commenced after that date, whether or not an award has been made by the Collector before the commencement of this Act.
(2) The provisions of sub-section (2) of Secs. 23 and 28 of the principal Act, as amended by Cl. (b) of Secs.15 and 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 later than 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.
(3) The provisions of Sec.34 of the principal Act, as amended by Sec.20 of this Act, shall apply, and shall be deemed to have applied, also to and in relation to-,
(a) every case in which possession of any land acquired under the principal Act had been taken before the 30th day of April, 1982 [the date of introduction of the Land Acquisition (amendment) Bill, 1982, in the House of the People], and the amount of compensation for such acquisition had not been paid or deposited under Sec.31 of the principal Act until such date, with effect on and from that date; and
(b) every case in which such possession had been taken on or after that date but before the commencement of this Act without the amount of compensation having been paid or deposited under the said Sec.31 with effect on and from the date of taking such possession.”
4. The petitioners’ case is that whereas the possession of the petitioners’ lands had been taken on 7.2.1983 as per the amended provisions of Section 34, they are entitled to get 9% interest for the first year from 7.2.1983 and for the rest of the period, i.e. till the amount of compensation is paid or deposited, the petitioners are entitled for interest at 15% per annum. It is the case of the petitioners that the petitioner No.1 moved an application to the respondent No.1 for interest as per Section 34 of the Land Acquisition Act. The respondent No.1 by his reply dated 5.1.1988 directed the petitioners to contact the respondent No.2 for the due amount of interest as per the agreement dated 7.2.1983 and the respondent No.1 forwarded the petitioners’ application dated 10.12.1987 to the respondent No.2. The respondent No.2 by his reply dated 6.2.1988 informed that he had acted as per the agreement dated 7.2.1983 and in terms of the agreement the rate of interest i.e. 4-1/2% per annum as was mentioned in the agreement had been paid and as such the request for interest as per Section 34 of the Land Acquisition Act was not acceptable. A copy of this reply dated 6.2.1988 has been placed on record at Exh.C with the petition. Aggrieved from this stand of the respondent No.2 in not paying the amount of interest as per Section 34, i.e. 9% on the amount of compensation from the date of taking over the possession from the first year, i.e. from 7.2.1983, and 15% from 7.2.1984 till the amount of compensation is paid, the petitioners preferred this Special Civil Application with the prayer as under:
“(B) Be pleased to issue a writ of mandamus or a writ in the nature of mandamus or any appropriate writ, direction or order, directing the respondents, their agents and servants to pay the amount of interest to the petitioner as per the provision of amended Section 34 of the Land Acquisition Act at the rate of 9% per annum from 7/2/83 to 7/2/84 and at the rate of 15% per annum from 7/2/84 till the amount of compensation is paid to the petitioner for the acquired lands.”
5. The Special Civil Application was filed in this Court on 19.12.1989 and the Rule was issued on 5.4.1991. No reply has been filed on behalf of the respondent No.1 or by respondent No.2. However, Mr.D.U.Shah appearing on behalf of the respondent No.2 has seriously contested the petition and has submitted that besides the amount of interim compensation of Rs.27,188/- per hectre which had been paid earlier, the rest of the due amount under the award along with interest in terms of the agreement, i.e. at the rate of 4-1/2% per annum, had also been paid to the petitioners and his contention is that in face of the clear agreement with regard to the rate of interest of 4-1/2%, the petitioners cannot enforce the claim of interest at any rate higher than 4-1/2% notwithstanding the amended provisions of the Land Acquisition Act as per the amendment in 1984 and the petitioners’ claim to get interest in terms of Section 34 is not at all tenable and in support of his submission, he has placed strong reliance on the decision of the Supreme Court in the case of ABDUL AZIZ ABDUL RAZAK v. MUNICIPAL CORPORATION OF GREATER BOMBAY reported in AIR 1996 SC at page 1350.
6. On the other hand, Mr.R.N.Shah has submitted that the petitioners are entitled to the payment of interest at the higher rate in terms of the amended provisions of Section 34 and that merely because it was mentioned in the agreement that interest will be payable at the rate of 4-1/2% cannot forestall the petitioners’ claim for the interest in accordance with the statutory provisions and he has emphatically submitted that the rate of interest of 4-1/2% was mentioned in the agreement because it was so provided under the amended Act of Gujarat at that time and further that in the agreement it was mentioned that the petitioners shall be entitled to interest in accordance with the provisions of the Land Acquisition Act, and the rate of interest of 4-1/2% only followed the aforesaid mention, i.e. in accordance with the provisions of the Land Acquisition Act. His contention is that the very mention of the rate of 4-1/2% in the agreement is not and cannot be conclusive. The matter is required to be examined as a matter of substance and not as of form. The substance was `in accordance with the provisions of the Act’ and not the `arithmetic figure’ as was mentioned at that time in the agreement keeping in view the relevant provisions in existence at that time. He has also cited before us the following cases:
1. Lalbhai Talsibhai Patel v. Additional Special Land Acquisition Officer reported in AIR 1986 Gujarat at page 24.
2. Bhurabhai K.Patel v. Special Land Acquisition Officer reported in 1991 Gujarat G.L.T. at page 61.
3. Defence Estate Officer v. Lilaben Govindbhai Prabhudas reported in 1998 (2) G.L.H. at page 279.
23rd March, 2001 7. We have heard learned counsel for both the sides and have gone through the pleadings and the cases cited before us. There is no dispute that in the agreement dated 12.6.1982, a copy of which has been annexed with the petition as Annexure-A, in Clause 3, it has been mentioned that the amount of interim compensation shall be deducted from the amount which may be awarded finally and on the difference of the amount, interest shall be paid in accordance with the provisions of the Land Acquisition Act at the rate of 4-1/2 % per annum upto the date of the award. A copy of the award dated 12.8.1986, Clause 12 therein shows that, regarding payment of interest, the Land Acquisition Officer ordered that interest shall be payable on the entire amount of the award and, on the difference of amount, from the date when the compensation was paid in advance upto the date of the award, in accordance with the Rules. The question, therefore, which arises for our consideration is as to whether the interest should be payable @ 4-1/2% only as was mentioned in the agreement or it has to be paid in accordance with the provisions of Sec.34 read with the Land Acquisition (Amendment) Act, 1984 the transitional provision Sect.30 thereof. We find that in the agreement the mention of the rate of 4-1/2% interest was only incidental and it was so mentioned because at that time under the Act the interest payable was 4-1/2%. However, now that the amendment has come into force retrospectively from 24.9.1984, i.e. between the date of taking the possession, i.e. 7.2.1983, and the date of the award, i.e. 12.8.1986, the rate of interest must be payable in accordance with the provisions of the Act. Even otherwise, in the agreement itself, the figure of 4-1/2% was in the context of the recital of provisions of the Act and, therefore, the claimants cannot be denied the statutory benefit to which they became entitled on the basis of the said amendment. The case of ABDUL AZIZ ABDUL RAZAK (supra) on which reliance has been placed by Mr. D.U.Shah, was a case in which on reference being made under Sec.18, the learned Single Judge had enhanced the compensation to Rs.300/- per sq. yd. by award and decree dated 19.2.1992 but disallowed interest in view of the agreement between the parties and, therefore, the Supreme Court held that notwithstanding anything contained in sub-section (1), the Land Acquisition Officer was entitled to award interest as per the contract entered into by the authorities though the Amendment Act came into force giving benefit of enhanced rate of interest, and it was found that the appellants in that case were not entitled to enhanced interest by virtue of their contract. In the case before us, the interest has not been disallowed nor has the Land Acquisition Officer said that the interest shall be paid only @ 4-1/2% as per the contract; instead, he has categorically mentioned that the interest shall be paid in accordance with the provisions of the Act as per the conditions of the agreement itself referring to the words that “it will be in accordance with the provisions of the Act”. In the case before the Supreme Court, the relevant condition under the agreement was as under:
“That the Corporation shall pay an amount of Rs.98,480/- (Rupees Ninety Eight Thousand Four Hundred Eighty only) being 2/3rd compensation to be calculated at the interim rates of Rs.40/- for the said property more particularly described in the First Schedule hereunder written on the execution of this agreement and the balance amount of the compensation as may be awarded under the Land Acquisition Act, 1894 shall be paid to the owners with interest thereon at the rate of 4% per annum from the date of possession.”
In the case befroe the Supreme Court, in the agreement itself there was no reference to the provisions of the Land Acquisition Act with regard to payment of interest and without referring to the provisions of the Act, it was agreed that interest shall be payable @ 4% per annum from the date of possession. We find that the facts of the present case are, therefore, clearly distinguishable. In such case, when the mention of 4-1/2% interest was made in the context of the provisions of the Act, the figure of 4-1/2% must be deemed to have been substituted on the basis of the amendment and the intention of the Legislature entitling interest at the higher rate cannot be defeated with reference to the arithmetic figure as was mentioned in the agreement as was entered into on 13.6.1982. Thus, in the facts of the present case, in the context of the specific term contained in the agreement at Item No.3 and Clause 12 of the award, the amended provisions have to be given effect to and on that basis the payment of interest in accordance with the law cannot be denied. In the case of LALBHAI TALSIBHAI PATEL (supra) relied upon by the petitioners, a Division Bench of our own High Court took the view that amended provisions apply to all pending cases, whether pending before Reference Court for passing the award, or pending before High Court or Supreme Court in appeal against award of Reference Court. In this case, a Division Bench of our own High Court has also considered the effect of the amendment of 1984. The State Act providing for award of interest @ 4-1/2% on enhanced compensation, the subsequent Central Amendment in 1984 provided for higher rate of interest of 9% and it was held by the Division Bench that it had the effect of repealing repugnant State law by virtue of proviso to Article 254(2) of the Constitution. Applying the law laid down by the Supreme Court in the cases reported in AIR 1983 SC 150 and AIR ` 1954 SC 752, the Division Bench of our High Court held that if by reason of State legislation in exercise of Article 254(2) of the Constitution, Section 28 of the Land Acquisition Act, 1894 operated in Gujarat State to award only 4-1/2% interest on the enhanced amount and if by a subsequent law the Parliament had amended Section 28 to increase the rate of interest to 9% per annum, the latter provision would be repugnant to the earlier provision enacted by the State amendment and consequently the law made by the Parliament should prevail by virtue of the proviso to Article 254(2) of the Constitution. We, therefore, find that the petitioners in this case cannot be deprived of the benefit of the Amendment and they are entitled to the compensation to be paid in accordance with the provisions of Section 34 of the Land Acquisition Act in the light of the Amendment of 1984. This Special Civil Application, therefore, succeeds and the same is allowed. The respondents are directed to pay to the petitioners the amount of interest as per the amended provisions of Section 34 of the Land Acquisition Act @ 9% per annum from 7.2.1983 to 7.2.1984 and @ 15% per annum from 7.2.1984 till the amount is paid to the petitioners for the acquired lands on the amount which had remained unpaid in terms of the award. Rule is made absolute with no order as to costs.