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TMI Blog2003 (4) TMI 560X X X X Extracts X X X X X X X X Extracts X X X X ..... erms of Section 30 of the Act. The competent authority determined the amount of compensation payable for such acquisition on 28.7.1975. However, the respondents being dissatisfied with the amount of compensation offered to them asked the competent authority to refer the matter to an arbitrator in terms of Section 31 of the said Act. Allegedly, such reference was not made. 4. Questioning the validity of the Act on the ground that their claim of interest at the rate of 6% and solatium at the rate of 15% had not been granted, writ petitions came to be filed. The High Court by reason of the impugned judgment held that Section 31 of the Act is ultra vires Article 14 of the Constitution of India, as a result whereof the respondents became entitled to claim and recover from the Central Government solatium at the rate of 15% on the amount of compensation as also the interest thereupon at the rate of 6% per annum. Several matters came up before this Court wherein acquisitions have been made under the provisions of various Improvement Trust Acts and other Acts. A question arose as to whether the provisions of the Land Acquisition Act as regards solatium and interest are to be read into the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in the Land Acquisition Act, 1894 was inserted as great delay used to be caused in payment of the amount of compensation determined on the basis of valuation of India from an anterior date, namely the date of publication of notification under Section 4 thereof. 10. Mr. O.P. Sharma, learned Senior Counsel appearing on behalf of the respondents, on the other hand, would submit that the classification so far as acquisition of land under the Land Acquisition Act vis-a-vis the Act cannot be said to be rational so far as the matter relating to payment of compensation is concerned, inasmuch as the owner of the land is not at all concerned as regard the purpose of acquisition. He would, therefore, submit that non-payment of solatium and interest where acquisition is made under the Act would clearly be discriminatory and, thus, violative of Article 14 of the Constitution of India. The learned counsel would contend that even for the purpose of computing the amount of compensation, when acquisition is made under the said Act, the criteria therefore would also be as per the provisions of the Land Acquisition Act. Strong reliance in this behalf has been placed by the learned counsel on Haji ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equisitioned under Section 23 may, in the manner hereinafter provided, be acquired in the circumstances and by the Government specified below, namely:- (a) where any works have, during the period of requisition, been construed on, in or over the property wholly or partly at the expense of any Government, the property may be acquired by that Government if it decides that the value of or the right to use, such works shall, by means of the acquisition of the property, be preserved or secured for the purposes of any Government, or (b) where the cost to any Government of restoring the property to its condition at the time of its requisition as aforesaid would, in the determination of that Government, be excessive having regard to the value of the property at that time, the property may be acquired by that Government. (2) When any Government as aforesaid decides to acquire any immovable property, it shall serve on the owner thereof or where the owner is not readily traceable or the ownership is in dispute, by publishing in the Official Gazette, a notice stating that the Government has decided to acquire it in pursuance of this section. (3) Where a notice of acquisition is served on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ature to expressly specify that interest or solatium shall not be payable for the lands or property acquired under Section 7(1) of the Act. Sub silentio is eloquent. It would further be seen that Section 8 of the Central Act equally does not provide for payment of solatium and interest. The Act was passed in the year 1968 while the Central Act was passed in 1952. It would, therefore, be reasonable to conclude that the State legislature was cognizant of the express provisions for payment of interest and solatium available in the Acquisition Act. The Act omitted similar provisions for payment of interest and solatium as part or omponent of compensation, obviously to fall in line with the Central Act." 19. In First Nagpur Improvement Trust (supra) the question which arose therein was as to whether the State Government being the acquiring authority for the acquisition of lands, be it under the Improvement Trust Act or the Kanpur Urban Development Act, or the Land Acquisition Act, any discrimination can be made as regards formulation of different principles of compensation and such classification would be violative of Article 14 of the Constitution of India. It was held: "It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... added proviso is identical in both the State Acts. This clearly implies that where acquisition was made under the provisions of the Land Acquisition Act, as modified, the legislature did not intend to deprive the claimants of solatium as provided under the Land Acquisition Act. But solatium was not payable in cases of cquisition under the State Acts. There are provisions in both the State Acts which permit the State to acquire lands for the purposes of the scheme without resorting to the provisions of the Land Acquisition Act such as acquisition by purchase, lease, exchange, or otherwise, or acquisitions contemplated under deferred street scheme, development scheme and expansion scheme. In respect of such acquisitions solatium is not payable. Such cases are similar to the acquisitions under Section 53 of the Bombay Town Planning Act which was considered by this Court in Prakash Amichand Shah v. State of Gujarat. In these circumstances with a view to save the law from the vice of the arbitrary and hostile discrimination, the provisions must be construed to mean, in the absence of anything to the contrary, that the provisions of the Land Acquisition Act as amended by the 194 Act rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perty at the relevant time. 27. One of the principles for determination of the amount of compensation for acquisition of land would be the willingness of an informed buyer to offer the price therefore. In terms of the provisions of the said Act acquisition of the property would be in relation to the property which has been under requisition during which period the owner of the land would remain out of possession. The Government during the period of requisition would be in possession and full enjoyment of the property. 28. It is beyond any cavil that the price of the land which a willing and informed buyer would offer would be different in the cases where the owner is in possession and enjoyment of the property and in the cases where he is not. The formulation of the criteria for payment of compensation in terms of Section 31 of the Act was clearly made having regard to the said factor, which cannot be said to be arbitrary or unreasonable. The Parliament while making the provisions for payment of compensation must have also taken into consideration the fact that the owner of the property would have received compensation for remaining out of possession during the period when the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly been decided. 34. We are, therefore, of the opinion that the impugned judgment cannot be sustained and are, therefore, liable to be set aside. 35. The question, however, which remains for consideration is as to whether the amount of solatium and interest which the appellants has paid to the respondents should be directed to be refunded. We think not. Even in Hari Krishan Khosla (supra) this Court noticed: "This is the case in which for 16 years no arbitrator was appointed. We think it is just and proper to apply the principle laid down in Harbans Singh Shanni Devi v. Union of India [C.A. Nos. 470 and 471 of 1985 disposed of by this Court on February 11, 1985]. The Court held as under:- "Having regard to the peculiar facts and circumstances of the present case and particularly in view of the fact that the appointment of the arbitrator was not made by the Union of India for a period of 16 years, we think this is a fit case in which solatium at the rate of 30 per cent of the amount of compensation and interest at the rate of 9 per cent per annum should be awarded to the appellants. We are making this order having regard to the fact that the law has in the meanwhile bee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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