Disputed compensation is releasable only after claimants establish entitlement in the partition suit.

Land in Sy. No. 85, Thirumagondanahalli, stood in the name of M. Ramappa and was partly acquired for the National Highways Authority of India.

After deduction of income tax, compensation of ₹4,39,94,804 was determined; ₹2,19,97,402 was paid to Ramappa, and the remaining ₹2,19,97,402 was deposited before the Reference Court following competing claims and an injunction in Bhagyamma’s partition suit, O.S. No. 1351/2022.

Nanjundappa and Bhagyamma each sought release of ₹1,09,98,701 from the deposited amount, but the Reference Court rejected their applications on 25 October 2025, leaving their entitlement to be determined in the partition suit.

Each claimant challenged the rejection under Articles 226 and 227 of the Constitution.

1. Whether the Reference Court erred in refusing to release part of the deposited compensation to Nanjundappa before the determination of his claimed share in the pending partition suit.

2. Whether the Reference Court erred in refusing to release part of the deposited compensation to Bhagyamma before the determination of her claimed share in the pending partition suit.

The petitions invoked Articles 226 and 227 of the Constitution, under which the High Court considered whether the Reference Court’s orders warranted supervisory or writ interference.

Nanjundappa’s application before the Reference Court was made under Section 151 of the Code of Civil Procedure, 1908.

The Court applied the principle that where entitlement to compensation depends on ownership or shares still in dispute in a pending partition suit, the Reference Court need not release the disputed amount before that entitlement is adjudicated; the amount may remain secured pending the suit’s outcome.

The judgment cited no precedent and did not separately construe a statutory provision governing the acquisition award.

The property and the acquisition compensation stood in Ramappa’s name, while Nanjundappa’s and Bhagyamma’s claimed shares depended on the unresolved partition proceedings.

The Court considered that the remaining 50% of the compensation had been deposited and that, even on the assumption that the property was joint-family property, the claimants’ respective shares still required determination.

It therefore found no error in declining interim release and directed that the deposited compensation be kept in an interest-bearing fixed deposit until further orders or for three years.

The Reference Court was directed to await the outcome of O.S. No. 1351/2022 and thereafter release compensation to Nanjundappa and Bhagyamma if they establish their entitlement.

The deposited compensation must be kept in an interest-bearing fixed deposit in a nationalized bank for three years or until further orders.

The Trial Court was requested to dispose of the partition suit within one year from framing of issues.