R B DEALERS PVT LTD vs UNION OF INDIA AND ORS.
- Court
- Calcutta High Court
In the High Court at Calcutta
Civil Appellate Jurisdiction
Appellate Side
The Hon’ble Mr. Justice Sabyasachi Bhattacharyya
And
The Hon’ble Mr. Justice Supratim Bhattacharya
F.M.A. No. 1273 of 2025
R.B. Dealers Private Limited & Incorporated
-Versus-
Union of India and others
For the appellant : Mr. Jaydip Kar, Sr. Adv.,
Mr. Siddhartha Banerjee,
Mr. Sayak Ranjan Ganguly,
Ms. Srijani Ghosh, ... Advs.
For the respondents : Mr. Promod Kumar Drolia,
Mr. Anindya Sundar Das, ... Advs.
Heard on : 26.02.2026, 02.04.2026
& 22.06.2026
Reserved on : 22.06.2026
Judgment on : 01.07.2026
Sabyasachi Bhattacharyya, J.:-
1. The present appeal arises out of a judgment dated July 14, 2023 passed in
WP No. 16818 (W) of 2019. The matter emanates out of an acquisition under
the Metro Railways (Construction of Works) Act, 1978 (hereinafter referred
to as “the 1978 Act”). Upon the acquisition of the subject property, the
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appellant/land loser was paid compensation, being aggrieved by which, the
appellant preferred an appeal before the statutory Authority. Being
dissatisfied with the award passed by the Authority, the writ petition was
preferred, culminating in the impugned judgment.
2. The primary grievance raised in the present appeal pertains to the
insufficiency of the interest granted under Section 80 of the Right to Fair
Compensation and Transparency in Land Acquisition, Rehabilitation and
Resettlement Act, 2013 (for short “ the 2013 Act”), in view of the 2013 Act
being applicable to the acquisition proceedings under the 1978 Act by dint
of Section 105(3), read with the Fourth Schedule, of the 2013 Act, Item 6 of
which applies the provisions relating to compensation under the 2013 Act to
the 1978 Act.
3. Learned senior counsel appearing for the appellant/land loser argues that
interest was awarded on the enhanced amount of compensation granted by
the Authority from the date commencing after the expiry of one year from
the date of possession, omitting to grant interest at the rate of 9% per
annum (p.a.) from the date of compensation till one year thereafter.
Secondly, it is argued that compensation ought to have been given from the
date of award, or at least from the date of declaration under Section 10 of
the 1978 Act, instead of the date of possession. Thirdly, it is argued that the
interest was calculated till June 11, 2019, whereas the payment was made
much thereafter.
4. While elaborating on his arguments, learned senior counsel appearing for
the appellant contends that physical possession of the subject land was
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taken on February 21, 2017, much prior to payment of compensation to the
appellant. In terms of the provisions laid down in Section 80 of the 2013
Act, when compensation is not paid or deposited on taking possession of the
land, the Collector owes an obligation to pay to the land loser the
compensation amount along with interest at the rate of 9 % p.a. from the
time the land is taken possession of till compensation is paid or deposited.
Further, in the event compensation is not paid or deposited within one year
therefrom, interest is to be paid at the rate of 15% p.a., from the date of
expiry of one year, on the amount of compensation or part thereof which
remains unpaid.
5. If the date on which the land belonging to the appellant was physically
taken possession of is considered to be the starting point for computation of
interest in terms of Section 80 of the 2013 Act, upon due adjustment to the
sum of Rs. 2,67,10,477/- received by the appellant towards interest from
the appropriate authorities pursuant to the impugned judgment, it is argued
that the appellants would be entitled to a further sum of Rs. 90,06,035/-, as
calculated in a computation sheet annexed to the written notes of argument
of the appellant.
6. Learned senior counsel further argues that by reason of the peculiarities of
the facts of the present case, the appellant is entitled to interest not from
the date of taking physical possession but from the date on which the initial
award was made for payment of compensation. Although it is true that
Section 80 contemplates interest to be calculated from the date of
possession, it is argued that the 1978 Act and has a unique and
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distinguishing feature unlike the Land Acquisition Act, 1894 (for short “the
LA Act”). Under the LA Act, the land stands vested absolutely in the
Government free from all encumbrances only after making of the award and
possession being taken, as provided under Section 16 of the said Act.
Section 17 of the LA Act lays down an emergency provision, where the
appropriate Government can take possession without complying with
certain formalities and in the event such an emergency provision is invoked,
the land stands vested in the Government free from all encumbrances in
terms of Section 17 of the said Act. Section 10 of the 1978 Act, it is
contended, is akin to Section 17 of the LA Act, since under both provisions,
the land vests absolutely in the Government.
7. Under Section 10 of the 1978 Act, the land vests free from all encumbrances
in the Government on the date of publication of declaration under sub-
section (1) thereof, unlike vesting as contemplated under Section 16 of the
LA Act. Section 12 of the 1978 Act also confers unfettered right on the
Government to enter the subject land and to undertake various acts once
the land is vested. Therefore, a land loser under the 1978 Act loses his right,
title and interest in the land immediately upon the declaration being made
under Section 10 of the said Act. If such remarkably distinguishing feature
of the 1978 Act is taken note of, it is argued that the same leads to an
irresistible conclusion that the land loser becomes entitled to interest under
the 1978 Act, read with the 2013 Act, not from the date of physical
possession but from the date of declaration or, in any event, from the date of
publication of the award.
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8. In the present case, the declaration under Section 10 of the 1978 Act was
made on February 13, 2014, simultaneously with which the land of the
appellant stood vested in the Central Government by operation of law and
the appellant’s right to the land stood curtailed. Thus, the appellant ought
to have been entitled to interest since the date of declaration inasmuch as
from the said date, the prejudicial affectation of the appellant had started.
Even on a conservative approach, it is argued that the appellant cannot be
denied interest from the date of the award that followed the date of
declaration.
9. Thus, applying the analogy of a land loser in case of an emergency
acquisition under the LA Act, the land loser in an acquisition under the
1978 Act should also get interest under Section 80 of the 2013 Act from the
date of physical possession, as the land stands vested in the Government on
the said date.
10. In support of such contention, learned senior counsel for the appellant relies
on Lila Ghosh (Smt) (Dead) Through LR. Tapas Chandra Roy v. State of W.B.,
reported at (2004) 9 SCC 337 .
11. Learned senior counsel next reiterates that in the impugned judgment, two
vital aspects were overlooked. First, the appellant was awarded interest only
on a portion of the compensation amount and secondly, interest was not
awarded for the entire period starting from the date of declaration or even
from the date of award till the date of actual payment.
12. It is submitted that in the event the interest payable is calculated on the
entire awarded amount from the date of the award, the appellant would be
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entitled to a further amount of Rs.1,38,49,499/-, as reflected in the further
computation sheet enclosed with the written notes of argument of the
appellant.
13. Learned senior counsel next controverts the argument of the respondent-
authorities that the 2013 Act or Section 80 thereof does not apply to
acquisition of land under the 1978 Act, on the ground that under the
Gazette Notification published on August 28, 2015, the benefits under the
2013 Act has clearly been made applicable to land losers under the 1978
Act. Thus, the appellant argues that the impugned judgment ought to be
modified on the above counts.
14. Per contra , learned counsel appearing for the respondent-authorities
contends that although no cross-objection has been separately filed, the
respondents are entitled to argue against the findings and components of
the impugned judgment as well.
15. By placing reliance on Section 105 of the 2013 Act, read with the Central
Government Gazette Notification dated August 28, 2015, learned counsel
appearing for the respondents contends that sub-section (3) of Section 105
entitles land losers to the benefit only in respect of determination of
compensation in accordance with the First, Second and Third Schedules of
the said Act, excluding the other provisions of the Act to such proceedings.
Thus, any dispute regarding interest on delayed payment or mode of
payment arising out of the 1978 Act will be governed by the 1978 Act and
not under the 2013 Act. The component of interest having not been
specifically applied to acquisitions under the 1978 Act by dint of the 2015
7
Notification, it is argued that the learned Single Judge erred in law in
directing payment of interest under Section 80 of the 2013 Act at all. It is
thus submitted that the excess amount of interest deposited by the
respondents, totaling Rs.2,67,10,477/-, was not payable to the appellant at
all.
16. Learned counsel for the respondents submits that the appellant had served
a photocopy to the respondents of a judgment passed by the Allahabad High
Court in WC No. 11417 of 2023 [Balwan Singh and Another vs. National
Highway Authority of India and Another] to argue that interest under Section
80 of the 2013 Act would apply to the acquisition proceedings under the
1978 Act as well. However, an appeal is pending against the judgment of the
Allahabad High Court passed in the said matter, bearing Diary No. 2131 of
2024, before the Hon’ble Supreme Court. The Hon’ble Supreme Court, it is
submitted, was pleased to admit the said Special Leave Petition and to issue
notice to the respondent therein vide order dated May 10, 2024. It is
contended that other similar Special Leave Petitions have also been admitted
by the Hon’ble Supreme Court against similar judgments.
17. In fine, learned advocate for the respondent argues that the impugned
judgment ought to be set aside and the appellant to be directed to refund
the sum of Rs. 26,71,10,477/- paid on June 7, 2024 to the respondent-
authorities, with interest at the rate of 9% thereon from date of payment till
refund.
18. Upon hearing both sides, the Court comes to the following conclusions:
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19. Before entering into the merits of the case, the contours of an acquisition
under the 1978 Act are required to be noted. The power of acquisition of
land has been conferred on the authorities under Section 6 of the 1978 Act.
Under Section 7 thereof, a notification has to be published in the Official
Gazette in case of such acquisition, whereafter hearing is to be given to the
objectors under Section 9 thereof. Subsequently, a further declaration is to
be made in the Official Gazette under Section 10. Under Section 10(2) of the
1978 Act, upon such declaration being issued, the acquired land vests
without encumbrances in the Central Government. Sub-section 10(4)
provides that no such declaration shall be called in question before any
court or before any other authority.
20. Under Section 13 of the 1978 Act, compensation for acquisition is to be
determined by the authorities.
21. Sections 25 and 26 of the 1978 Act speaks about the amount payable for
damages, loss or injury upon the acquisition process and the right to claim
such damages, whereas Section 17 of the 1978 Act excludes the operation of
the LA Act from acquisitions under the 1978 Act.
22. Under Section 25(2) of the 1978 Act, an appeal lies to the Authority under
the said Act if the amount of compensation is not acceptable to either party.
23. Thus, by dint of Section 17 of the 1978 Act, the provisions of the LA Act are
not applicable in respect of acquisitions under the 1978 Act.
24. Section 105 of the 2013 Act is germane in the context and is quoted
hereinbelow:
9
“ 105. Provisions of this Act not to apply in certain cases or to apply
with certain modifications. –(1) Subject to sub-section (3), the provisions
of this Act shall not apply to the enactments relating to land acquisition
specified in the Fourth Schedule.
(2) Subject to sub-section (2) of section 106, the Central Government
may, by notification, omit or add to any of the enactments specified in the
Fourth Schedule.
(3) The Central Government shall, by notification, within one year
from the date of commencement of this Act, direct that any of the provisions
of this Act relating to the determination of compensation in accordance with
the First Schedule and rehabilitation and resettlement specified in the
Second and Third Schedules, being beneficial to the affected families, shall
apply to the cases of land acquisition under the enactments specified in the
Fourth Schedule or shall apply with such exceptions or modifications that do
not reduce the compensation or dilute the provisions of this Act relating to
compensation or rehabilitation and resettlement as may be specified in the
notification, as the case may be.
(4) A copy of every notification proposed to be issued under sub-
section (3), shall be laid in draft before each House of Parliament, while it is
in session, for a total period of thirty days which may be comprised in one
session or in two or more successive sessions, and if, before the expiry of
the session immediately following the session or the successive sessions
aforesaid, both Houses agree in disapproving the issue of the notification or
both Houses agree in making any modification in the notification, the
notification shall not be issued or, as the case may be, shall be issued only
in such modified form as may be agreed upon by both the Houses of
Parliament.”
25. As seen from the language of this above Section, the provisions of the 2013
Act per se do not apply to the enactments relating to land acquisition which
are specified in the Fourth Schedule. Under Item 6 of the Fourth Schedule,
the 1978 Act is enumerated.
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26. However, sub-section (1) of Section 105 carves out an exception to the effect
that such bar is subject to sub-section (3) of the said Section. Under sub-
section (3), the Central Government, by notification within one year from the
date of commencement of the 2013 Act, has the power to direct any of the
provisions of the 2013 Act relating to the determination of compensation in
accordance with the First Schedule and rehabilitation and resettlement
specified in the Second and Third Schedules, being beneficial to the affected
families, to be applied to the cases of land acquisition under the enactments
specified in the Fourth Schedule, or to apply with such exceptions or
modifications that do not reduce the compensation or dilute the provisions
of the 2013 Act relating to compensation or rehabilitation and resettlement
as may be specified in the notification.
27. The next salient document which acquires relevance is Notification No. S.O.
2368(E) dated August 28, 2015 issued by the Central Government through
the Ministry of Rural Development. The said notification/Government Order
is set out verbatim below:
MINISTRY OF RURAL DEVELOPMENT
ORDER
New Delhi, the 28th August, 2015
S.O. 2368(E).- Whereas, the Right to Fair Compensation and Transparency in Land Acquisition,
Rehabilitation and Resettlement Act, 2013 (30 of 2013) (hereinafter referred to as the RFCTLARR Act)
came into effect from 1st January, 2014;
And whereas, sub-section (3) of Section 105 of the RFCTLARR Act provided for issuing of
notification to make the provisions of the Act relating to the determination of the compensation,
rehabilitation and resettlement applicable to cases of land acquisition under the enactments specified in the
Fourth Schedule to the RFCTLARR Act;
And whereas, the notification envisaged under sub-section (3) of Section 105 of the RFCTLARR
Act was not issued, and the RFCTLARR (Amendment) Ordinance, 2014 (9 of 2014) was promulgated on
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31st December, 2014, thereby, inter-alia, amending Section 105 of the RFCTLARR Act to extend the
provisions of the Act relating to the determination of the compensation and rehabilitation and resettlement
to cases of land acquisition under the enactments specified in the Fourth Schedule to the RFCTLARR Act;
And whereas, the RFCTLARR (Amendment) Ordinance, 2015 (4 of 2015) was promulgated on
3rd April, 2015 to give continuity to the provisions of the RFCTLARR (Amendment) Ordinance, 2014;
And whereas, the RFCTLARR (Amendment) Second Ordinance, 2015 (5 of 2015) was
promulgated on 30th May, 2015 to give continuity to the provisions of the RFCTLARR (Amendment)
Ordinance, 2015 (4 of 2015);
And whereas, the replacement Bill relating to the RFCTLARR (Amendment) Ordinance, 2015 (4
of 2015) was referred to the Joint Committee of the Houses for examination and report and the same is
pending with the Joint Committee;
As whereas, as per the provisions of article 123 of the Constitution, the RFCTLARR
(Amendment) Second Ordinance, 2015 (5 of 2015) shall lapse on the 31st day of August, 2015 and thereby
placing the land owners at the disadvantageous position, resulting in denial of benefits of enhanced
compensation and rehabilitation and resettlement to the cases of land acquisition under the 13 Acts
specified in the Fourth Scheduled to the RFCTLARR Act as extended to the land owners under the said
Ordinance;
And whereas, the Central Government considers it necessary to extend the benefits available to
the land owners under the RFCTLARK Act to similarly placed land owners whose lands are acquired
under the 13 enactments specified in the Fourth Schedule; and accordingly the Central Government
keeping in view the aforesaid difficulties has decided to extend the beneficial advantage to the land owners
and uniformly apply the beneficial provisions of the RFCTLARR Act, relating to the determination of
compensation and rehabilitation and resettlement as were made applicable to cases of land acquisition
under the said enactments in the interest of the land owners;
Now, therefore, in exercise of the powers conferred by sub-section (1) of Section 113 of the Right
to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013
(30 of 2013), the Central Government hereby makes the following Order to remove the aforesaid
difficulties, namely:--
1. (1) This Order may hay be called the Right to Fair Compensation and Transparency in Land
Acquisition, Rehabilitation and Resettlement (Removal of Difficulties) Order, 2015.
(2) It shall come into force with effect from the 1st day of September, 2015.
2. The provisions of the Right to Fair Compensation and Transparency in Land Acquisition,
Rehabilitation and Resettlement Act, 2013, relating to the determination of compensation in accordance
with the First Schedule, rehabilitation and resettlement in accordance with the Second Schedule and
infrastructure amenities in accordance with the Third Schedule shall apply to all cases of land acquisition
under the enactments specified in the Fourth Schedule to the said Act.
[F. No. 13011/01/2014-LRD]
K. P. KRISHNAN, Addl. Secy.
28. The present appeal is required to be adjudicated in the above backdrop.
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29. The moot questions which fall for consideration herein are formulated
below:-
(i) Whether land losers in acquisition proceedings under the 1978 Act are
entitled to interest under Section 80 of the 2013 Act;
(ii) Whether interest is payable from the date of dispossession or award;
(iii) Whether interest is payable on enhanced amount as a whole or
piecemeal, by segregating interest on initial award under Section 30(2),
2013 Act and interest on enhanced award under Section 69 of the said
Act.
30. The said issues are decided in the following manner:-
(i) Whether land losers in acquisition proceedings under the 1978
Act are entitled to interest under Section 80 of the 2013 Act
31. It is to be noted that the bar under sub-section (1) of Section 105 of the
2013 Act is subject to the notifications issued by the Central Government
under sub-section (3) thereof. Certain conspicuous indicators as to the
scope of applicability of the 2013 Act are embedded in sub-section (3) of
Section 105 itself. The Central Government, under the said provision, is
empowered to apply any of the provisions of the 2013 Act relating to the
determination of compensation and rehabilitation and resettlement , specified
in the First, Second and Third Schedules respectively.
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32. It is further enumerated that such provisions, being beneficial to the affected
families, shall apply to the cases of land acquisition under the enactments
specified in the Fourth Schedule .
33. In the alternative, the provisions shall apply with such exceptions or
modifications that do not reduce the compensation or dilute the provisions of
the 2013 Act relating to compensation or rehabilitation and resettlement as
may be specified in the notification, as the case may be .
34. Hence, the applicability of the said Act, once a notification is issued under
Section 105(3) of the 2013 Act, is in the context of being beneficial to the
affected families. Even the exceptions or modifications thereto, which the
Central Government is empowered to introduce in the notifications, cannot
reduce the compensation or dilute the provisions of the 2013 Act relating to
compensation, rehabilitation or resettlement.
35. The Notification dated August 28, 2015 issued under Section 105(3) of the
2013 Act provides inter alia that the Central Government considers it
necessary to extend the benefits available to the land owners under the
2013 Act to similarly placed land owners whose lands are acquired under
the enactments specified in the Fourth Schedule. The expression “similarly
placed” is used in the context of the historical background of the
Notification, narrated thereinabove, which speaks about the land owners
being placed in a disadvantageous position due to lapse of the Second
Amendment Ordinance, 2015 to the 2013 Act on August 31, 2015, resulting
in denial of the benefit of enhanced compensation and rehabilitation and
resettlement to cases of land acquisition under the Acts specified in the
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Fourth Schedule of the 2013 Act as extended to the land owners under the
said ordinance.
36. Accordingly, as per the 2015 Notification, the Central Government, keeping
in view the aforesaid difficulties, has decided to extend the beneficial
advantage to the land owners and applies such provisions
uniformly relating
to the determination of compensation and rehabilitation and resettlement as
were made applicable to case of land acquisition under the said enactments
in the interest of land owners .
37. The terms “beneficial in advantage to the land owners” and “uniformly” are
noteworthy.
38. The Notification proceeds, “therefore”, in exercise of powers conferred under
Section 113(1) of the 2013 Act, to make the concerned Notification/Order to
remove the difficulties mentioned thereinabove.
39. Item 2 of the Notification stipulates that the provisions of the 2013 Act
relating to the determination of compensation in accordance with the First
Schedule , rehabilitation and resettlement in accordance with the Second
and Third Schedules, shall apply to all cases of land acquisition under the
enactments specified in the Fourth Schedule of the said Act .
40. Thus, the provisions of the 2013 Act “relating to determination of
compensation in accordance with the First Schedule” (along with
resettlement and rehabilitation under the Second and Third Schedules) shall
apply to all cases of acquisition under the Fourth Schedule Acts, in terms of
the Notification. Therefore, the Notification applies all provisions of 2013 Act
“relating to determination of compensation” in accordance with the First
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Schedule of the 2013 Act in a blanket fashion to acquisitions under the
1978 Act.
41. The first salient feature which catches the eye is that the Notification applies
not only the bare compensation components in the First Schedule but “all
provisions relating to compensation” of the 2013 Act, which also covers
interest under Section 80 of the said Act.
42. Moreover, Section 30(2) of the 2013 Act provides for individual awards
detailing particulars of compensation payable and details of compensation
as specified in the First Schedule. However, the First Schedule does not
speak merely of ‘compensation’ but all components of minimum
compensation package. The broad expression “minimum compensation
package” includes ingredients such as solatium which, as per the
Explanation to Section 30(1) of the 2013 Act, is “in addition to”
compensation. Thus, the First Schedule is not limited to compensation but
includes additional components, recognised to be so in the statute itself,
also to be included in the minimum compensation package. Item 5 of the
First Schedule categorically incorporates solatium, which is recognised
specifically in the Explanation to Section 30(1) to be “in addition to
compensation”.
43. Another aspect which is required to be considered is that Serial No. 8 of the
First Schedule includes “other components, if any, to be included”. Hence,
the said residuary provision also connotes that the ambit of the First
Schedule is not limited to mere compensation. The 2015 Notification applies
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the entire First Schedule vis-à-vis acquisitions under the 1978 Act, thus
including other components including interest.
44. From a still different perspective, interest for delayed payment, conceptually,
is strictly not a ‘component’ of compensation but a necessary concomitant of
“compensation payable” for acquisition. The question of imposition of such
interest arises only when compensation payable to the land loser is not paid
within due time and, by itself, is not an ingredient of compensation as such.
The liability to pay interest is an integral part of equity, to compensate land
losers for the delay occasioned by the authorities by sitting over the
compensation which, if paid in time, could fetch interest for the land loser.
45. Considered from the said angle, interest for delayed payment need not
specifically be enumerated in the Notification to be payable. The liability to
pay interest if payment of compensation is not made in time arises
simultaneously with the liability to pay compensation itself and is an
essential and integral part of the very concept of compensation. Thus, the
argument of the respondents, that non-inclusion of the term “interest”
specifically in the 2015 Notification deprives land losers of such interest, is
specious but not borne out by cardinal concepts of law and equity.
46. We cannot also lose sight of the fact that by its very provisions, the 2015
Notification is a beneficial piece of delegated legislation, since it claims to
extend beneficial advantage and uniformly apply the beneficial provisions of
the 2013 Act relating to determination of compensation to similarly placed
land owners without reducing the compensation or diluting the provisions of
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the 2013 Act. As such, the same has to be construed liberally in favour of
the beneficiaries thereof.
47. Accordingly, this issue is decided in favour of the appellant, holding that
land losers in acquisition proceedings under the 1978 Act are also entitled
to interest under Section 80 of the 2013 Act.
(ii) Whether interest is payable from the date of dispossession or
award
48. Section 80 of the 2013 Act is quoted hereinbelow:-
“ 80. Payment of interest. —When the amount of such compensation is
not paid or deposited on or before taking possession of the land, the
Collector shall pay the amount awarded with interest thereon at the rate
of nine per cent per annum from the time of so taking possession until it
shall have been so paid or deposited.
Provided that if such compensation or any part thereof is not paid or
deposited within a period of one year from the date on which possession
is taken, interest at the rate of fifteen per cent per annum shall be
payable from the date or expiry of the said period of one year on the
amount of compensation or part thereof which has not been paid or
deposited before the date of such expiry.”
49. The language of the said provision unambiguously stipulates the dates from
which the liability to pay the same commences, breaking the period of
interest into two parts. The main Section stipulates that interest is to be
awarded at the rate of 9% p.a. from the date of taking possession of the
land, if not paid or deposited till then, until it is so paid.
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50. However, the proviso to Section 80 applies a different regime of rate of
interest, stipulating that if such compensation is not paid within one year
from the date of dispossession of the land loser, the rate will be enhanced to
15% p.a., payable on the amount of compensation or part thereof which
remains unpaid from the expiration of the said period of one year till the
date of payment. Hence, till one year after the date of dispossession, interest
has to be paid at the rate of 9% p.a. and, thereafter, at the rate of 15% p.a.
till payment/deposit.
1
51. The appellant relies on Lila Ghosh (supra) to argue that the interest should
be calculated from the date of the award or at least the declaration under
Section 10 of the 1978 Act. However, in the said judgment, the Hon’ble
Supreme Court exercised its powers under Article 142 of the Constitution of
India in order to do complete justice in the facts of the case and did not,
with respect, lay down a binding precedent of law. In the absence of
anything in the said judgment to indicate that the provisions of Section 80
or any of the provisions of the 2013 Act were struck down, it is the said
provisions which still provide the guidelines in respect of the date of
commencement of interest calculation.
52. The analogy sought to be drawn by the appellant between the LA Act and
the 2013 Act is misplaced. Section 17 of the 1978 Act, it has to be kept in
mind, categorically excludes the operation of the said Act to acquisitions
under the 1978 Act, whereas Section 105(3) of the 2013 Act empowers the
1
Lila Ghosh (Smt) (Dead) Through LR. Tapas Chandra Roy v. State of W.B., reported
at (2004) 9 SCC 337
19
Central Government, by notification, to apply the provision of the 2013 Act
to acquisitions under any of the enactments in the Fourth Schedule,
including the 1978 Act. The regime of acquisition and compensation under
the LA Act is completely different from the paradigm provided in the 1978
Act, read with the 2013 Act.
53. Under the LA Act, two different classes of acquisition are contemplated. In
respect of emergency acquisition under Section 17 thereof, the clock starts
from the date of dispossession of the land loser and unless a portion of the
compensation as stipulated therein is immediately paid, the calculation of
interest starts to run, apparently on the logic that the land vests with the
Government with possession being taken. As opposed thereto, in case of a
regular acquisition under the LA Act, only upon possession being taken
post-declaration and passing of award under Section 16 of the LA Act does
the land vest in the Government.
54. However, in the teeth of the specific provisions of the 2013 and 1978 Acts,
no amount of analogy could replace the specific intention of the Legislature.
Hence, the said line of argument cannot be accepted.
55. Accordingly, this issue is decided against the appellants, by holding that in
terms of Section 80 of the 2013 Act, the interest under the said provision is
payable from the date of dispossession of the land loser and not from the
date of either the award or the declaration under the 1978 Act.
56. Any other interpretation would be patently contrary to the statute.
20
(iii) Whether interest is payable on enhanced amount as a whole or
piecemeal, by segregating interest on initial award under
Section 30(2), 2013 Act and interest on enhanced award under
Section 69 of the said Act
57. The appellant argues that the interest is to be imposed by treating the
enhanced award as a single slab. However, the scheme of the 2013 Act is
otherwise.
58. Section 27 of the 2013 Act provides for the determination of the amount of
compensation and Section 30(2) thereof stipulates that the Collector’s
department shall issue individual awards detailing the particulars of
compensation payable and the details of payment of compensation as
specified in the First Schedule.
59. Under Section 64 of the 2013 Act, a reference may be made to the Authority
by any person interested, who has not accepted the award, whether his
objection be to the measurement of the land, the amount of compensation,
etc. Section 69 provides for the determination of award by the Authority.
60. Section 80 of the 2013 Act provides for compensation of interest “when the
amount of such compensation is not paid or deposited on or before taking
possession of the land”.
61. However, Section 72 of the said Act specifically contemplates interest on
excess compensation. Section 72 is quoted hereinbelow:
“ 72. Collector may be directed to pay interest on excess
compensation. —If the sum, which in the opinion of the Authority
concerned, the Collector ought to have awarded as compensation is in
excess of the sum which the Collector did award as compensation, the
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award of the Authority concerned may direct that the Collector shall pay
interest on such excess at the rate of nine per cent. per annum from the
date on which he took possession of the land to the date of payment of
such excess into Authority:
Provided that the award of the Authority concerned may also
direct that where such excess or any part thereof is paid to the Authority
after the date or expiry of a period of one year from the date on which
possession is taken, interest at the rate of fifteen per cent. per annum
shall be payable from the date of expiry of the said period of one year
on the amount of such excess or part thereof which has not been paid
into Authority before the date of such expiry.”
62. The said provision is somewhat similar to Section 80, except that it refers to
interest only on the excess amount determined by the Authority, as opposed
to the original award passed by the Collector. The regime of interest is the
same as Section 80, being 9% from date of possession for a period of one
year and, thereafter, 15% p.a. till payment/deposit.
63. If we read Sections 72 and 80 of the 2013 Act in conjunction, two different
sets of interest are found to have been contemplated. Since Section 72 deals
exclusively with the interest payable on the excess amount awarded by the
Authority over and above the original award of the Collector, Section 80, by
necessary implication, becomes the residuary provision, governing interest
on delayed payment of the compensation awarded by the Collector. Hence,
the interest contemplated under Section 80 is to be tied up with the initial
award under Section 30(2) of the 2013 Act, whereas interest under Section
72 has to be linked with determination of enhanced award by the Authority
under Section 69.
22
64. Thus, if the Authority enhances the quantum of compensation, Section 80 is
to be invoked for calculation of interest on the original amount, whereas
Section 72 provides the guidelines for calculation of interest only over the
excess amount granted by the Authority.
65. Proceeding on the basis of the above guiding principle, the interest of the
original award in the present case, being Rs.12,54,55,482/-, has to be
calculated at the rate of 9% p.a. from the date of dispossession (February
21, 2017) for one year, till February 20, 2018; thereafter, at the rate of 15%
from February 21, 2018 (after the expiry of one year) till deposit (on August
30, 2018). Calculated thus, the interest on the original award is as follows:
(9% of 12,54,55,482) [for one year] = 1,12,90,993
(15% from February 21, 2018 till August
30, 2018) [Six months]
= 94,09,161
TOTAL = 2,07,00,154
66. Similarly, the excess amount granted by the Authority = (15,35,39,946 –
12,54,55,482) = 2,80,84,464.
67. The interest thereon comes to:
(9% of 2,80,84,464) [for one year] = 25,27,602
(15% from February 21, 2018 till date of
payment that is November 11, 2019)
[Twenty-One months]
= 73,72,172
TOTAL = 98,99,774
68. Thus, the total amount of interest payable comes to Rs.(2,07,00,154 +
98,99,774) = Rs.3,05,99,928/-.
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CONCLUSION
69. In view of the aforementioned findings, FMA 1273 of 2025 is allowed in part
on contest, modifying the impugned judgment dated July 14, 2023 passed
in WPA No.16818 of 2019 to the extent that the respondents shall pay to the
appellant, as interest for delayed payment of compensation, the amount of
Rs.3,05,99,928/-.
70. There will be no order as to costs.
71. Urgent certified copies, if applied for, be supplied to the parties upon
compliance of all formalities.
(Sabyasachi Bhattacharyya, J.)
I agree.
(Supratim Bhattacharya, J.)
Later
After the above judgment is passed, learned counsel appearing for the
respondents prays for stay of operation of the above judgment.
We grant stay of the said judgment for thirty days from date.
(Supratim Bhattacharya, J.) (Sabyasachi Bhattacharyya, J.)