2016 (1) TMI 1275 - HC - Indian Laws

Determination of compensation under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 - Held that - A perusal of Section 64(1) clearly indicates that reference under Section 64(1) is to be made with regard to various factors which are contemplated under the 2013 Act. The phrase Rehabilitation and Resettlement under Chapters V and VI is used in the 2013 Act. Hence, if the award is not acceptable to a person, remedy under Section 64(1) is available to him. There is no occasion for such person to file a reference under Section 18 of the 1894 Act. Hence the submission of the learned Government Pleader that the petitioner had to make a reference under Section 18, has to be rejected. The learned Government Pleader also does not dispute the statutory scheme as delineated under Section 96 and submits that a direction can be issued by this Court for payment of the amount without any deduction towards income tax. In view of the foregoing discussion, interests of justice would be served, in disposing of the writ appeal with the following directions i) The appellant, without accepting the award, shall be paid the amount as compensation under Annexure R2(c) without any deduction towards income tax. ii) The District Collector shall effect the necessary payment in terms of the award without any deduction towards income tax within a period of four weeks from today. iii) The petitioner shall make a reference under Section 64 of the 2013 Act within a period of six weeks from today, in view of the fact that we have held Annexure R2(c) as an award under the 2013 Act.

Summary

Issues:
1. Determination of compensation under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.
2. Validity of the award under the 2013 Act.
3. Permissibility of income tax deduction in the award.

Issue 1: Determination of compensation under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013:
The case involved a writ appeal against a judgment allowing the petitioner to withdraw the amount deposited in Court, related to the acquisition of property for a national highway project. The petitioner sought further determination of compensation under the 2013 Act. The Court noted that the award had not been prepared before the enactment of the 2013 Act and emphasized that all provisions of the Act relating to compensation determination apply to awards prepared after 01/01/2014.

Issue 2: Validity of the award under the 2013 Act:
The appellant contested the award, claiming it was not passed under the 2013 Act and raised objections regarding the determination method. The Government Pleader argued that the award was made in accordance with the 2013 Act, citing the inclusion of 100% solatium. The Court clarified that if dissatisfied with the award, the petitioner could make a reference under Section 64 of the 2013 Act, rejecting the need for a reference under Section 18 of the 1894 Act.

Issue 3: Permissibility of income tax deduction in the award:
The appellant challenged the income tax deduction in the award, citing Section 96 of the 2013 Act, which exempts income tax on awards. The Court agreed that no income tax deduction was permissible under the Act and directed the District Collector to pay the compensation amount without any deduction within four weeks. The petitioner was instructed to make a reference under Section 64 of the 2013 Act within six weeks, considering the award as under the 2013 Act.

In conclusion, the Court directed the payment of compensation without income tax deduction, emphasizing the petitioner's right to challenge the award under the 2013 Act through a reference.