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SANJIV KHANNA, D. Y. CHANDRACHUD
Tamil Nadu Housing Board – Appellant
Versus
Abdul Salam Sarkar (Dead) – Respondent
JUDGMENT :
DHANANJAYA Y CHANDRACHUD, J.
1. Leave granted.
2. The only question which arises in the present appeal is whether the respondents are entitled to interest on solatium for the acquisition which took place under the provisions of the Land Acquisition Act 1894. This issue turns on an interpretation of the judgment of the Constitution Bench of this Court in Gurpreet Singh vs Union of India (2006) 8 SCC 457 (“Gurpreet Singh”).
3. By an order of this Court dated 1 December 2020, the issue was crystallized by observing that the Court will “examine the question whether (the) matter is covered by the judgment of this court in the case of Gurpreet Singh”.
4. In the present case, the reference court by its decision dated 26 July 1990, allowed for the grant of interest on solatium at the rate of 12% per annum.
5. When the matter was carried in appeal, a Division Bench of the Madras High Court by its judgment dated 12 July 2001, issued the following clarification on the aspect of interest on solatium:
“It is further made clear that the claimants are not entitled to interest on solatium and additional amount. Further, the issue regarding grant of interest on solatium is pending before the L
Acquisition of land – Interest on Solatium can be claimed only in pending executions and not in closed executions.
The court established that solatium is a component of compensation, entitling claimants to interest on it from the date of acquisition, contrary to restrictions imposed by the High Court.
The solatium and interest amount were held to be payable under the Act of 1953, and the solatium formed a component of the compensation itself, warranting interest. The interest on solatium was held ....
The Supreme Court's ruling in Gurpreet Singh case overrules previous compensation principles, necessitating new administrative directives under the Land Acquisition Act.
Interest on solatium in land acquisition cases must be awarded as per Supreme Court rulings, invalidating conflicting government directives.
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