FAO No. 303 of 1989 [1]
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
Date of decision: 3.12.2009
(1) FAO No. 303 of 1989 (O&M)
Union of India and another .. Appellants.
v.
Paras Ram and others .. Respondents.
(2) FAO No. 304 of 1989
and Cross Objections No. 71-CII of 1989 (O&M)
Union of India and another .. Appellants.
v.
Kaushalaya and others .. Respondents
(3) FAO No. 305 of 1989 (O&M)
Union of India and another .. Appellants.
v.
Pritam and another ` .. Respondents
(4) FAO No. 442 of 1989 (O&M)
Pritam Dass (Deceased) through LRs .. Appellants
v.
Union of India and others .. Respondents
(5) FAO No. 443 of 1989 (O&M)
Pritam (Deceased) through LRs .. Appellants
v.
Union of India and others .. Respondents.
(6) FAO No. 444 of 1989 (O&M)
Paras Ram and others .. Appellants
v.
Union of India and others .. Respondents.
FAO No. 303 of 1989 [2]
CORAM: HON'BLE MR. JUSTICE RAJESH BINDAL
Present: Mr. Rajiv Sharma, Advocate for Union of India.
Mr. Talwinder Singh, Advocate for
Mr. Hemant Saini, Advocate for the land owners.
Rajesh Bindal J.
This order will dispose of above mentioned appeals and cross
objections, as the same arise out of a common award of the Arbitrator.
FAO Nos. 303 to 305 of 1989 have been filed by Union of India
praying for setting aside of the award of the Arbitrator, whereby interest and
solatium has been awarded to the land owners.
FAO Nos. 442 to 444 of 1989 and Cross Objections No. 71-CII of
1989 have been filed by the land owners claiming enhancement of compensation
awarded by the Arbitrator.
However, the facts have been extracted from FAO No. 303 of 1989.
Briefly, the facts of the case are that total land measuring 100 kanals
and 10 marlas, situated in the revenue estate of Bhadroya was acquired by Union
of India for defence purposes vide notification dated 28.2.1970, issued under
Section 7(1) of the Requisitioning and Acquisition of Immoveable Property Act,
1952 (for short, `the Act’). Since the compensation awarded by Union of India was
not acceptable to the land owners, they sought appointment of an Arbitrator under
Section 8 of the Act. Vide notification dated 3.3.1988, Additional District Judge,
Gurdaspur was appointed as Arbitrator for determination of the compensation
payable to the land owners. The Arbitrator, vide award dated 20.1.1989,
determined compensation to the land owners for the acquired land at uniform rate
of Rs. 350/- per mala. The land owners were also held entitled to receive solatium
@ 30% and interest @ 9% per annum for the first year and 15% per annum for the
subsequent years.
The only issue raised by learned counsel for Union of India in the
bunch of appeals is that for the acquisition carried under the Act, the land owners
are not entitled to the grant of interest and solatium, as there is no provision for the
same under the Act. Reliance was placed upon a judgment of Hon’ble the Supreme
Court in Union of India v. Parmal Singh and others, (2009) 1 SCC 618 and this
Court in Smt. Lalita Pathania and others v. Randip Singh Pathania and others,
(2009-3) PLR 680.
On the other hand, learned counsel for the land owners submitted
that in terms of the judgment of this Court in Smt. Lalita Pathania’s case (supra),
FAO No. 303 of 1989 [3]
the land owners herein are entitled to interest @ 6% per annum on equitable
grounds, considering the fact that there is abnormal delay in conclusion of
proceedings for determination of compensation as the land was acquired way back
in the year 1970, whereas the Arbitrator was appointed in the year 1988.
Heard learned counsel for the parties and perused the paper book.
As far as the legal position regarding entitlement of the land owners
to the payment of interest and solatium on the amount of compensation for the land
acquired under the Act is concerned, the issue is no more res integra. It has been
authoritatively considered by Hon’ble the Supreme Court in Union of India v. Hari
Krishan Khosla (Dead) by LRs, 1993 Supp. (2) SCC 149 that there being no
provision providing for interest and solatium on the amount of compensation in
the Act, the land owners are not entitled to the same. The issue thereafter was
considered by this Court in Smt. Lalita Pathania’s case (supra), wherein after
considering the law on the subject, it was opined as under:
” After giving my thoughtful consideration to the arguments raised
by learned counsel for the parties, I am of the view that the appeals
filed by the Union of India deserves to be allowed. No doubt, that at
the time of passing of the order by the Arbitrator when he awarded
solatium @ 15% per annum and interest @ 6% per annum, the law
laid down by the Full Bench in the case of Hari Krishan Khosla
(Dead) and others (supra) was holding the field as the order passed
by the Arbitrator is of 29.9.1989. However, the said judgment of the
Full Bench has now been over-ruled by the Supreme Court in the
case of Union of India v. Hari Krishan Khosla (Dead) by LRs (supra)
and the fact that there is no provisions in the statute for the award of
solatium and interest, the claimants are not entitled to solatium and
interest at all.”
It was further opined in the aforesaid judgment that on equitable
consideration, the land owners would be entitled to interest on the amount of
compensation @ 6% per annum. Paragraph 23 of the judgment is extracted below:
“It was also held that the property was acquired in the year 1965 and
more than four decades have elapsed whereas the land owners are
yet to get compensation in entirety. In these circumstances, the
Supreme Court upheld the award of interest at the rate of 6% per
annum on the compensation amount on equitable grounds. Thus,
taking into consideration the totality of circumstances, FAO Nos.
1319 and 1320 of 1989 filed by the claimants/land owners against
FAO No. 303 of 1989 [4]
the award of the Arbitrator on issue No. 3 are allowed and the
finding recorded thereunder is hereby reversed. FAO Nos. 1346 and
1347 of 1989 filed by Union of India against issue No. 6 are allowed
only to the extent that the appellants shall not be entitled to any
solatium as it is not provided in the Statute. However, since the
possession of the land in question was taken by Union of India in the
year 1964 and the arbitrator was appointed in the year 1986, the
claimants are held entitled to interest at the rate of 6% per annum on
equitable grounds in terms of the decision of the Supreme Court in
the case of Union of India v. Parmal Singh (supra), from the date of
acquisition till date of payment/deposit. However, in the facts and
circumstances of these cases, the parties shall bear their own costs.”
However, still considering the fact that the land in question was
acquired way back in the year 1970. The amount of compensation, as has been
determined payable in the award by the Arbitrator is merely Rs. 350/- per marla.
The amount of compensation as well as the interest and solatium has already been
paid to the land owners long back, however, the same would be refundable to
Union of India, if calculated in terms of the aforesaid judgment, considering the
fact that the land owners are not entitled to solatium and interest at the rates
provided for under the Land Acquisition Act, 1894 but only at 6% per annum.
But the amount if calculated in terms of individual holdings of land owners would
be quite meager. Therefore, while accepting the appeals filed by Union of India
technically on the legal issues and disposing of the same in terms of the judgment
of this Court in Smt. Lalita Pathania’s case (supra), it is directed that the amount
on account of interest and solatium already paid to the land owners in the present
cases shall not be recovered from them.
As far as the claim of the land owners in one of the appeal and the
cross objections filed by them for further enhancement of compensation is
concerned, suffice to state that the same is totally misconceived as the
compensation has been determined in terms of earlier judgment of this Court, as
has been recorded in para 10 of the award. Hence, the same are rejected.
The appeals as well as cross objections stand disposed of in the
aforesaid terms.
(Rajesh Bindal)
Judge
3.12.2009
mk