1. Dispute concerning the applicability of interest on solatium under Section 28 of the Land Acquisition Act, 1894. (Para 3 )
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1998 Supreme(SC) 782
SUPREME COURT OF INDIA
J.Jagannadha Rao : S.B.Majmudar
Kapur Chand Jain (Dead)
Versus
State Government Of Himachal Pradesh
Case No. : 20139 , 20140 of 1997
Date of Decision : 8/10/98
Advocates Appeared: Jain Neeraj Kumar : Mohan Manish : Prasad Ugra Shankar
Important Points
The court identified a conflict between three-judge bench decisions regarding whether interest is payable on solatium and additional amounts under the Land Acquisition Act, 1894, and consequently referred the matter to a three-judge bench for resolution.
Subject
Civil Law - Land Acquisition
Act Referred
Headnote
(A) Land Acquisition Act, 1894 - Sections 23(1-A), 23(2) and 28 - Interest on solatium - Whether solatium should be considered a component of compensation for the purpose of calculating interest under Section 28 - Conflict of decisions between different three-judge benches of the Supreme Court regarding the payability of interest on solatium and additional amounts. (Para 3)
Facts of the case:
The petitioners challenged a decision of the High Court which had refused to grant interest on solatium. The core of the dispute is whether solatium and additional amounts payable under the Land Acquisition Act are treated as components of compensation that attract interest.
Findings of Court:
The court observed a direct conflict between two three-judge bench judgments. One view suggests that solatium is a component of compensation and interest can be paid thereon, while another view holds that no interest is payable on solatium under Section 23(2) or on additional amounts payable under Section 23(1-A).
Issues: Whether interest is payable on solatium under Section 23(2) or on the additional amount payable under Section 23(1-A) of the Land Acquisition Act, 1894.
Ratio Decidendi: In view of the conflict between two three-judge bench decisions, and the fact that the later bench had no opportunity to refer to the earlier decision, the matter must be decided by a three-judge bench to resolve the inconsistency.
Result: Special leave petitions placed for decision before a three-judge bench.
Facts of the case:
The petitioners challenged a decision of the High Court which had refused to grant interest on solatium. The core of the dispute is whether solatium and additional amounts payable under the Land Acquisition Act are treated as components of compensation that attract interest.
Findings of Court:
The court observed a direct conflict between two three-judge bench judgments. One view suggests that solatium is a component of compensation and interest can be paid thereon, while another view holds that no interest is payable on solatium under Section 23(2) or on additional amounts payable under Section 23(1-A).
Issues: Whether interest is payable on solatium under Section 23(2) or on the additional amount payable under Section 23(1-A) of the Land Acquisition Act, 1894.
Ratio Decidendi: In view of the conflict between two three-judge bench decisions, and the fact that the later bench had no opportunity to refer to the earlier decision, the matter must be decided by a three-judge bench to resolve the inconsistency.
Result: Special leave petitions placed for decision before a three-judge bench.
Legal Category Hierarchy
Table of Contents
2. Whether solatium constitutes a component of compensation attracting interest under Section 28 of the Land Acquisition Act, 1894. (Para 3 )
3. Conflicting decisions exist between three-judge benches regarding the payment of interest on solatium under the Land Acquisition Act, 1894. (Para 3 , 4 )
4. A conflict between decisions of three-judge benches on the same legal issue warrants referral to a three-judge bench for resolution. (Para 4 )
5. Special leave petitions referred to a three-judge bench for decision. (Para 4 )
6. Is interest payable on solatium under the Land Acquisition Act, 1894?
There are conflicting views among three-judge benches; some consider solatium a component of compensation attracting interest under Section 28, while others hold no interest is payable on solatium under Section 23(2) or additional amounts under Section 23(1-A). (Para 3 )
7. What is the procedure when three-judge bench decisions of the same court conflict on a legal issue?
The court directs that the matter be placed for decision before a three-judge bench to resolve the conflict. (Para 4 )
(1) INDIAN ADMINISTRATIVE SERVICE Nos. 3 and 4 are granted. Legal representatives of Petitioner 1 are permitted to be brought on record.
(2) SO far as INDIAN ADMINISTRATIVE SERVICE Nos. 1 and 2 are concerned, we are informed that as Petitioner 3 had died pending proceedings in the High court, an application for bringing the legal representatives of Petitioner 3 on record was also filed in the High court and that is granted. Accordingly, these lAs are also granted. The legal representatives of Petitioner 3 are permitted to be broug on record as they are already brought on record by the High court.
(3) LEARNED counsel for the petitioners invited our attention to a three-Judge bench judgment of this court in Union of India v. Ram Mehar and also later two decisions of two-Judge benches of this court in Periyar and Pareekanni Rubbers Ltd. v. State of Kerala and Narain Das Jain v. Agra Nagar Mahapalika. Relying on these judgments, he submitted that for applicability of Section 28 of the Land Acquisition Act, 1894 solatium has to be considered as a component of compensation and interest could be paid thereon; and that the High court has wrongly not granted interest on solatium. However, there is another three-Judge bench judgment of this court in Prem Nath Kapur v. National Fertilizers Corpn. of India Ltd. wherein a contrary view is taken and it has been held, as seen from Headnote, that no interest is payable on solatium under Section 23(2 or on additional amount payable under Section 23(1-A). For coming to that conclusion, the bench of three learned Judges relied upon another decision of this court in P. Ram Reddy v. Land Acquisition Officer.
(4) IN view of this conflict of decisions and also in view of the further fact that the three-Judge bench of this court in Prem Nath Kapur had no opportunity to refer to the earlier decision of a three-Judge bench in Ram Mehar we direct that these special leave petitions be placed for decision before a three-Judge bench of this court. The office may obtain suitable orders from the Honble chief justice.
Court Masters
