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TMI Blog2013 (6) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... nsation amount from the date of taking possession to date of payment, at the rate of 3% per annum for the first twenty years and thereafter (that is from the date of expiry of the period of 20 years) to 31.3.2005 (date of payment) at the rate of 6% per annum. X X X X Extracts X X X X X X X X Extracts X X X X ..... e of 3% per annum on the compensation amount and for a mandamus to pay the compensation with interest at 9% per annum from the date of surrender of possession to date of actual payment. The appellant contended in the writ petition that having regard to decisions of the Bombay High Court in Krishnakumar Vithalrao Jamdar vs. State of Maharashtra (WP No.83 of 1986 decided on 29.6.1991) and Shree Changdeo Sugar Mills vs. State of Maharashtra (WP No.3805/2000 decided on 7.7.2000) wherein interest was awarded at the rate of 9% per annum in regard to compensation payable under the said Act, the second respondent acted illegally in awarding interest at a lesser rate of 3% per annum. Therefore, the writ petition filed by appellant did not relate to a simple money claim. It required adjudication in regard to the allegations of arbitrariness and discrimination on the part of the state government and its officers in the exercise of their statutory functions, before the issue of rate of interest could be examined or determined. Primarily, therefore the writ petition was of a public law character as it related to the public law functions on the part of the state government and its officers, and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al v. Stateof Madhya Pradesh - AIR 1965 SC 1740). (iv) There is a distinction between cases where a claimant approaches the High Court seeking the relief of obtaining only refund and those where refund is sought as a consequential relief after striking down the order of assessment etc. While a petition praying for mere issue of a writ of mandamus to the state to refund the money alleged to have been illegally collected is not ordinarily maintainable, if the allegation is that the assessment was without a jurisdiction and the taxes collected was without authority of law and therefore the respondents had no authority to retain the money collected without any authority of law, the High Court has the power to direct refund in a writ petition [vide Salonah Tea Co.Ltd. v. Superintendent of Taxes, Nangaon (1988) 1 SCC 401]. (v) It is one thing to say that the High Court has no power under Article 226 of the Constitution to issue a writ of mandamus for making refund of the money illegally collected. It is yet another thing to say that such power can be exercised sparingly depending on facts and circumstances of each case. For instance, where the facts are not in dispute, where the collec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the High Court had directed payment of compensation with interest at the rate of 9% per annum from the date of taking possession of lands till date of actual payment. Alternatively it was submitted that the said decisions not having considered section 26 of the Act, they were not rightly decided. 9. There is considerable force in the submissions of Mrs. Madhavi Divan, the learned counsel for the respondents that the decisions of Bombay High Court in Krishna Kumar and Changdeo are not sound, as they completely ignore section 26 of the Act, while awarding interest at 9% per annum on the belated payment of compensation. 10. The question as to when and what circumstances, interest could be awarded on belated payment of compensation, was considered by this Court in Union of India vs. Parmal Singh - (2009) 1 SCC 618. This Court first referred to the general principle and then the exceptions thereto, as under : "When a property is acquired, and law provides for payment of compensation to be determined in the manner specified, ordinarily compensation shall have to be paid at the time of taking possession in pursuance of acquisition. By applying equitable principles, the courts have al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd of 20 years. It also contemplates payment being made either by transferable bonds or in cash. Sub-section (3) of Section 26 enabling payment of compensation by cash, in cases where it could not be paid by such bonds, does not disturb the rate of interest, which is 3% per annum for 20 years, provided in sub-section (1) thereof. We are therefore of the view that whether the payment is made by transferable bonds or by cash, the rate of interest can be only at 3% per annum for a period of 20 years from the date of taking possession. 12. The next question that requires consideration is about the rate of interest if the payment is not made even after 20 years, and whether it should be only at the rate of 3% per annum, even after 20 years. Section 26 is silent about the rate of interest payable, if the compensation is not paid within 20 years. We are therefore of the view that section 26 contemplates payment of the compensation within 20 years from the date of taking possession with interest at 3% per annum; and for the period beyond 20 years, the said provision regarding interest will cease to apply and the general equitable principles relating to interest will apply; and interest ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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