No Section 80 interest accrues when deposited compensation remains unclaimed despite notice.

The petitioner’s land was acquired under the National Highways Act, 1956 (“NH Act”) for widening National Highway 30.

An award determining compensation was passed on 12 July 2016, and possession was taken on 16 December 2016.

The competent authority issued the petitioner a notice under Section 3H of the NH Act to appear on 23 September 2016 with the documents required to receive compensation.

The petitioner acknowledged receipt but did not appear on the scheduled date; she later admitted that she first appeared before the authority in November 2020.

After compensation was paid into her account on 8 February 2021, she sought interest for the period of delay.

The authority rejected her claim on 7 December 2020.

This followed an earlier writ petition in which the Court had permitted her to apply to the authority for interest.

1. Whether the petitioner was entitled to interest on the compensation amount for the period between the taking of possession and its payment, despite her failure to respond to the notice to receive compensation.

2. Whether the competent authority’s rejection of the interest claim was legally unsustainable.

Under Section 3H(1) of the NH Act, compensation determined under Section 3G is to be deposited by the Central Government with the competent authority before possession is taken; Section 3H(2) provides for payment to the landowner, while Section 3H(5) provides interest at 9% on an excess amount determined by an arbitrator.

Section 80 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (“2013 Act”) provides for interest at 9% where compensation is not paid or deposited on or before possession.

The 2013 Act’s First, Second and Third Schedules were extended to acquisitions under enactments listed in the Fourth Schedule, including the NH Act, by the 2015 Order issued under Section 105.

Under the National Highways (Manner of Depositing the Amount by the Central Government with the Competent Authority for Acquisition of Land) Rules, 1998, the competent authority deposits the amount received in a separate Public Deposit Account.

The Court distinguished Bapusaheb Udesang Raj and Mohd. Shahid because, unlike those cases, the compensation here had been deposited with the competent authority and the petitioner had been notified to collect it.

The Court found that the petitioner received the Section 3H notice, which required her to provide documents including bank details, but did not appear on the appointed date or submit the necessary documents then.

It accepted that the compensation had been deposited with the competent authority and that payment to other landowners followed their submission of the required documents.

Because the petitioner’s failure to complete the collection process caused the non-payment to her, the Court held that she could not claim interest for that period.

It also rejected the argument that the unpaid amount had to be deposited with another authority under Section 64 of the 2013 Act, finding no such requirement under the applicable NH Act scheme and the 1998 Rules.

It found no error in the order dated 7 December 2020 and dismissed the writ petition, with no order as to costs.