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SUPREME COURT OF INDIA
V. GOPALA GOWDA, ADARSH KUMAR GOEL, JJ.
M/S PERIYAR & PAREEKANNI RUBBERS LTD. – APPELLANT
VERSUS
STATE OF KERALA – RESPONDENT
CIVIL APPEAL NOS. 7034-7037 OF 2015 (Arising out of S.L.P. (C) NOS. 29463-29466 of 2012)
Decided On : 14-09-2015
(a) Land Acquisition Act, 1894 – Sections 23(1A), 23(2) r/w Sections 28 and 34 and Section 4(3), Land Acquisition (Amendment and Validation) Act, 1967 – Solatium cannot form part of the market value of the land – Compensation includes the amount determined u/s 23(1) on the basis of market value as also the additional amount of solatium as stipulated under Section 23(2) – Import of the word “sum” under Section 28 – Award includes not only the sum determined u/s 23(1) but also the amounts payable under Section 23(1A) and Section 23(2) – Award u/s 26(1) includes amounts awarded u/s 23(1A) and 23(2) – Therefore, enhanced compensation includes solatium @ 30% as provided u/s 23(2) of the Act – Claimant/decree holder, held, entitled for interest on the solatium being a component of the compensation payable. (Para 17, 21, 23, 24, 26)
(2001) 7 SCC 211; AIR 1968 SC 1481; AIR 1961 SC 908 – Relied upon
(1996) 2 SCC 71; (1973) 1 SCC 109; (1995) 3 SCC 208; (1996) 2 SCC 570; (1991) 4 SCC 195; (1999) 2 SCC 89; (2000) 10 SCC 470 – Referred
(2006) 8 SCC 457 – Distinguished
(b) Legal Interpretation – Interpretation of judgment – Ratio and obiter dicta – Binding Precedent – A word, a clause or a sentence in a judgment out of context cannot be considered as laid down law, that too, on a question which was not an issue in that judgment – It will not be ratio of the judgment but obiter dicta and hence not binding – Further, ratio of a case should not be applied mechanically even in identical cases. (Para 29, 30)
AIR 1971 SC 530; (2002) 4 SCC 638; (1983) 4 SCC 645 – Relied upon
Per ADARSH KUMAR GOEL, J.
(c) Land Acquisition Act, 1894 – Section 23, 26 and 34 – Reference Court, in its award of 19th November, 1992, not awarding interest on solatium expressly – High Court restricting the same to the period post 19th September, 2001 – State contending that order of Reference court has attained finality – If State’s contention stands then appellants not entitled to interest on solatium – The other Judge of this Bench granting interest on solatium – In view of difference of opinion, matter referred to a larger Bench. (Para 2, 3, 4)
(2006) 8 SCC 457; (2010) 10 SCC 635; (2010) 13 SCC 234; (2012) 5 SCC 763 – Referred
Facts of the case:
These appeals relate to the claim of solatium for the enhanced amount of compensation and interest thereon in respect of the acquired land. The High Court has confirmed that solatium is payable on that portion of land value based on capitalization method of yielding rubber trees and directed to compute balance amount payable under the decree. However, it awarded the interest on solatium from 19.09.2001, the date when judgment by the Constitution Bench in the case of Sunder v. Union of India, (2001) 7 SCC 211 was delivered and not for the prior period.
The appellant is aggrieved by the denial of the interest payable on the component of solatium under Sections 23(1A), 23(2) read with Sections 28 and 34 of the Land Acquisition Act, 1894. The solatium being the component of compensation payable to the claimant/decree holder, the restriction upon its payment by the High Court placing reliance upon another subsequent Constitution Bench judgment of this Court in the case of Gurpreet Singh v. Union of India, (2006) 8 SCC 457 is hereby challenged.
Finding of the Court:
The judges differed in their opinions.
Result: Matter referred to larger Bench.
JUDGMENT
V. GOPALA GOWDA, J.
Leave granted.
2. These appeals by special leave are directed against the impugned common judgment and order dated 07.04.2010 passed by the High Court of Kerala at Ernakulam in Civil Revision Petition Nos. 196, 199, 205 and 208 of 2009 (filed against the order dated 15.10.2008 of the learned Sub-Judge, Ernakulam-the Execution Court), wherein the dispute between the parties related to the claim of solatium for the enhanced amount of compensation and interest thereon in respect of the acquired land. The High Court has confirmed that solatium is payable on that portion of land value based on capitalization method of yielding rubber trees and directed to compute balance amount payable under the decree, but awarded the interest on solatium from 19.09.2001, the date when judgment by the Constitution Bench in the case of Sunder v. Union of India, (2001) 7 SCC 211 was delivered by this Court and not for the prior period. The legality and validity of the impugned judgment and order is seriously challenged urging various legal contentions as the appellant is aggrieved by the denial of the interest payable on the component of solatium under Sections 23(1A), 23(2) read with Sections 28 and 34 of the Land Acquisition Act, 1894 (for short “the Act”). The solatium being the component of compensation payable to the claimant/decree holder, the restriction upon its payment by the High Court placing reliance upon another subsequent Constitution Bench judgment of this Court in the case of Gurpreet Singh v. Union of India, (2006) 8 SCC 457 is hereby challenged.
3. The brief facts of the case are stated hereunder:-
Various portions of rubber estate of the appellant situated in village Kuttamangalam was acquired by the State Government in exercise of its eminent domain power pursuant to the notification dated 10.10.1978 issued under Section 4(1) of the Act for the purpose of Periyar Valley Irrigation Project.
4. In 1980 and 1981 Awards were passed by the Land Acquisition Officer awarding compensation, on the market value of land which were partly based on capitalization method of the yielding rubber trees for the planted area and partly based on the value of bare land on which there were no yielding rubber plantation. Awards included solatium and interest on compensation including solatium.
5. Being dissatisfied with the compensation, the appellant filed Land Acquisition Reference (LAR) Nos. 425, 427, 428, 429, 432, 434, 435, 456, 458 and 463 of 1988 before the Court of III Additional Sub-Judge, Ernakulam (the Reference Court) under Section 18 of the Act.
6. The Reference Court after perusal of the record, by its common judgment, passed an Award on 19.11.1992 by enhancing the compensation partly based on capitalization method of the yielding rubber trees for the planted area and partly based on the value of bare land on which there were no rubber trees. The Reference Court held that the claimant is entitled to get 30% solatium, 12% additional market value from the date of the notification i.e., 10.10.1978 till the date of Award passed against it and they are also entitled to get 9% interest for the first one year from the date of dispossession and thereafter at 15% till realization of the compensation awarded in favour of the claimant/decree holder.
7. In some of the abovesaid LARs, payments were made by respondent-State in full and final settlement of the enhanced compensation, solatium and interest on compensation including solatium. With respect to the remaining cases, the appellant filed Execution Petition Nos. 152, 147, 146, 149 and 145 of 1996 before the Execution Court for execution of the Award/decree passed by the Reference Court.
8. The Execution Court on 15.10.2008 passed an order fixing balance amount payable by the State government after excluding solatium on that portion of the market value of the acquired land based on capitalization method of the yielding rubber trees for the planted area.
9. Being aggrieved by
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