Judgment

MOHAN, J.:- Delay condoned. Permission to prefer special Leave Petitions granted.

2. Leave granted.

3. The facts leading to these appeals are as under:

An extent of 6.50 acres of land in village Marripalam Taluk and District Visakhapatnam was requisitioned for defence purposes in the year 1942. Subsequently they were acquired under the Requisitioning & Acquisition of Immovable Property Act, 1952 (Central Act 30 of 1952) (hereinafter referred to as the Act) on 11-1-1972 along with adjoining land of an extent of 68.25 acres. The competent authority fixed compensation at the rate of Rs. 10/- per square yard under Section 8(3) read with Rule 9(l) of the Act. Being dissatisfied with the compensation, the owners of the property sought a reference to the arbitrator. By an award dated 28-3-1981, the arbitrator (District Judge) awarded compensation at the rate of Rs. 15/- per square yard and solatium at 15% and interest at 6% from the date of publication of Form J Notification. Accordingly, the enhanced amount was deposited in court through Special Petition LA (defence) Visakhapatnam.

4. Still not being satisfied with the decision of the arbitrator, the respondent Kolluni Ramaiah and three sets of land owners went on appeal to High Court of Andhra Pradesh praying for the enhancement of the rate of compensation fixed by the arbitrator. The High Court of Andhra Pradesh granted Rs. 20/- per square yard and retained the award of arbitrator as regards payment of solatium at 15% and interest at 6% in all these cases. However, it requires to be stated that the appellant, Union of India was not a party to the proceedings either before the arbitrator or before the High Court. It is urged that since the enhanced compensation and the amount payable as solatium and interest are substantial, Union of India is the main party which has been affected by this enhancement. An application was filed before us for preferring the present petitions for special leave.

5. Mr. C. V. Subba Rao, learned Counsel for Union of India urges that the enhancement of compensation is unwarranted. Even otherwise, as on today, in view of the authoritative pronouncement of this Court in Union of India v. Hari Krishan Khosla (dead) by LRs., (1992) 5 JT (SC) 574 the award of solatium and interest is not permissible, in a case of acquisition of property under the Act. Properly speaking, the Union of India ought to have been made a party both before the arbitrator and the High Court. In fact, when the first respondent (Kolluni Ramaiah) preferred C.M.A. No. 137 , / 1982 before the Andhra Pradesh High Court, it was held that the non-inclusion of Union of India as a party would be sufficient ground to dismiss the case. On these grounds, it is prayed that not only the permission to prefer the Special Leave Petitions be granted but also the award be set aside.

6. To a pointed question as to how this Court could reach the award of arbitrator by which alone solatium and interest were granted and they were merely retained by the High Court, it was submitted that where the award of solatium and interest is illegal in view of the judgment of this Court, it would be unjust and can be set aside. Even otherwise, that part of the award gets merged with the judgment of the High Court and, therefore, this Court could always interfere. However, it is fairly conceded that Union of India would be satisfied if without interfering with the actual compensation, the part of the award relating to solatium and interest is only set aside.

7. The learned Counsel for the respondents would (sic) that the award of arbitrator become final not having been appealed against. It is under that award, solatium and interest were granted. The finality of the award cannot be disturbed in an appeal filed by the owners in the High Court, unless and until Union of India had filed a separate appeal complaining of the grant of solatium and interest. The respondents (owners of land) cannot be worse off for having appealed