JUDGMENT

SUDHANSU JYOTI MUKHOPADHAYA, J.

Leave granted. The appellant is aggrieved by impugned order dated 15th September, 2011 passed by the Division Bench of the High Court of Bombay, Nagpur Bench, Nagpur in a Review Application, MCA No.774/2011. By the impugned order the Division Bench reviewed and recalled the judgment and order dated 5th October, 2010 passed in Writ Petition No.3883/2010(D) filed by the appellant. The High Court further directed the State of Maharashtra to deposit rental compensation at the rate of 8% of the amount of Rs.1,07,82,270/- as enhanced and awarded by the Reference Court, in First Appeal No.06/2010, as the same is pending against the award passed by the Reference Court. The High Court by the impugned order also allowed the appellant to withdraw only half of the amount deposited by the State upon furnishing security to the satisfaction of the Registrar and to keep remaining amount in FDR of a Nationalised Bank pending the litigation.

2. The only question involved in this appeal is whether the High Court of Bombay, Nagpur Bench was justified in directing the State to deposit the rental compensation with the Appellate Court at the rate of 8% per annum on the award value passed by the Reference Court for the period of occupation before formal acquisition, allowing the appellant to withdraw only 50% of such rental compensation during the pendency of the appeal.

3. The factual matrix giving rise to this appeal are as follows:-

The matter relates to payment of rental compensation with regard to land occupied by State before the formal acquisition. The Land Acquisition Act, 1894 does not contemplate the payment of any rental compensation. The entitlement of rental compensation is on the basis of resolutions and instructions issued by the State of Maharashtra from time to time since 7th February, 1949 including Resolutions dated 2nd May, 1961, 1st December, 1972, 2nd April, 1979 and 24th March, 1988.

4. By the aforesaid Resolutions, the State of Maharashtra has empowered the Irrigation and Power Department/Buildings and Communication Department Officers to take possession of lands required for its development works by private negotiations, wherever possible, as it was apprehended that the speed of acquisition of lands under the Land Acquisition Act, 1894(hereinafter referred to as the 'Act'), would not be, in view of its procedural requirements, commensurate with the speed of work planned by the Department, thus resulting in delay in execution of works. It was also indicated that prompt payment of such compensation should be done.

5. By Resolution dated 2nd May, 1961 it was decided by the State Government that in cases where awards have been declared by the Revenue authorities, rental compensation should be paid at the rate of 4% per annum on the award value for the period of occupation before the formal acquisition plus the adjustment which has been paid by the owner of the land for that period in respect of that land. Subsequently, by Resolution dated 1st December, 1972 while procedure for taking possession of the land by private negotiations were notified, the determination of rental compensation was enhanced to 6-1/2% per cent of the final award value, as apparent from the paragraph 6 of the said Resolution quoted hereunder:

“6 .Payment of rental compensation: The responsibility of payment of rental compensation of to the title holder of the lands taken over by I.& P.D./B & C.D. officers through private negotiations rests with I.&P.D. /B.&C.D. Officers for the period from the date on which possession of the land is taken over till the date on which the full amount of final Award is paid. Government has now decided that the rental compensation payable shall be 6-1/2% of the final award value in respect of both Non-Agricultural land and Agricultural land. With a view to avoiding any inconvenience to the owners of the land who have willingly parted with their land and to ensure timely and regular payments