Bom HC discusses law regarding determination of compensation and statutory interest in Land Acquisition matters

Bombay High Court: B.U. Debadwar, J., observed the difference between Sections 28 and 34 of the Land Acquisition Act, 1894 in determining the award to be granted to a person, in the absence of an exact date of possession.

Respondent–claimant was the exclusive owner in possession of the lands situated to village leet, Taluka Bhoom, Osmanabad.

Appellant-State acquired two lands for the Dokewadi Medium Project. Preliminary notification under Section 4(1) of the Land Acquisition Act, 1894 was published on 13-04-1990. Possession of both the lands was also taken in the same year.

Award

On 31-12-1994, Special Land Acquisition Officer, after following due process, passed the award thereby determining the compensation at the rate of 15,000 per acre and separately awarded compensation as well.

Section 18 of the Land Acquisition Act

Reference application was moved under Section 18 of the Land Acquisition Act, 1894 for enhancement of compensation after accepting the award under protest.

Civil Judge, Senior Division, Osmanabad allowed the reference partly and enhanced the compensation to Rs 30,000 per acre with statutory benefits.

Appellant–State preferred the present appeal on being aggrieved by the aforestated judgment and award passed by the Joint Civil Judge, Osmanabad and respondent — claimant filed a cross objection under Order 41 Rule 22 of the Code of Civil Procedure, 1908.

Analysis and Decision

On perusal of the impugned Judgment, Court noted that Joint Civil Judge, Senior Division, Osmanabad treated the acquired lands as fertile ‘jirayat lands’ and awarded compensation at the rate of Rs 30,000 per acre.

The Joint Civil Judge appeared to have discarded the evidence of claimant on the aspect of nature of acquired land i.e. ‘bagayat land’, only for the reason that it is not supported by pleadings raised in reference application.

It is pertinent to note that State has awarded separate compensation of various trees, well and taal (dike) situated in acquired land, to the respondent – claimant.

When the appellant – State has awarded separate compensation of well, the question of denying the existence of well in acquired land does not arise.

Having regard to the area of land covered by sale instance proved by the respondent — claimant, area of lands under acquisition by owned by him, nature of acquired lands, i.e. seasonally irrigated lands, source of irrigation, Court held that the compensation determined by the reference Court is not adequate and just compensation.

Further, the Court added that the compensation needs to be raised to Rs 50,000 per acre from Rs 30,000 per acre. Hence, the respondent-claimant is entitled to compensation at the rate of Rs 50,000 per acre.

In the absence of the date of taking possession of lands under acquisition, it is difficult to know whether possession of lands under acquisition was taken prior to publication of the preliminary notification under Section 4(1) of the Land Acquisition Act, 1894, or after the publication of the same.

Though it is clear that possession of acquired lands was taken prior to the passing of award i.e. prior to 31-12-1994.

Section 16 of the Land Acquisition Act, 1894 deals with the power to take possession. According to this provision, when the Collector has made an award and under Section 11 he may take the possession of the land, which shall thereupon absolutely vests in the Government, free from encumbrances.

Whereas, Section 17 of the Land Acquisition Act, 1894, speaks about special powers in case of urgency. According to this provision, in case of urgency, wherever appropriate Government directs the Collector, though no such award has been made, may, on expiration from 15 days from the publication of notice mentioned in Section 9 Sub-Section (1), take possession of any land needed for a public purpose. Such land shall thereupon vest absolutely in the Government free from encumbrances.

In the present matter, there is absolutely no evidence about taking possession of lands under acquisition by invoking special powers contemplated under Section 17 of the Land Acquisition Act, 1894.

In view of the decision of State of Maharashtra v. Kailash Shiva Rangari,2016 SCC OnLine Bom 2236 the respondent-claimant would be entitled to interest under Section 34 of the Land Acquisition Act, 1894 from the date of passing of an award under Section 11 of the Land Acquisition Act, 1894 i.e. 31-12-1994 and not from 1990 when possession of acquired lands were taken.

Further, the Court added that the Section under which interest is awarded is neither mentioned in the body of the judgment nor in the operative part.

However, looking to the operative part in its entirety it appears that interest awarded in clause (4) is awarded either under Section 28 or Section 34 of the Land Acquisition Act, 1894 and interest awarded in clause (6) is in the form of rental compensation.

Hence, the claimant is entitled to interest under both Sections of the Land Acquisition Act, 1894 i.e. Section 28 and Section 34 and that has to be awarded from the date of award till realisation of the compensation amount.

Therefore, Joint Civil Judge in Clause 96 of the operative part of the impugned judgment committed a mistake in awarding rental compensation in the form of interest covered under Sections 28 and 34 of the Land Acquisition Act, 1894.

Court partly allowed the appeal and cross objection in the present matter. [State of Maharashtra v. Laxman, 2020 SCC OnLine Bom 894, decided on 04-09-2020]

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