The Land Acquisition (Madras Amendment) Act, 1953, is ultra vires and discriminatory and, therefore, violative of Article 14 of the Constitution.

SEETHARAMA REDDY, J.

( 1 ) THIS review raises the question of rate of interest to be awarded on the amount of compensation under the Land Acquisition Act vis-a-vis the lands acquired for the Central Government in the year 1963. The material particulars, in brief, may be sequenced.

( 2 ) THE lands of the petitioners were acquired for the Central Government, inter alia, towards the construction of Railway Staff Quarters; and possession of the lands was taken over on 6-12-1963, 12-1-1964 and 15-6-1965. Interest at the rate of 4 per cent per annum was awarded on the compensation amount; and the same was eventually confirmed by this Court in the appeal, which is now sought to be reviewed.

( 3 ) THE grounds briefly are: An honest mistake was committed by the Counsel in not bringing to the notice of the Court, paragraph 21 of Schedule IV of Part III of the Land Acquisition Manual, which provides for interest at the rate of 6 per cent per annum in cases of acquisition of land for the purposes of the Central Government though the rate is 4 per cent per annum if the land is acquired for the State Government. The said Para. 21 of Boards Standing Order 90 was amended only in the year 1966 by G. O. Ms. No. 1364 dated 21-11-1966 providing for payment of interest at the rate of 4 per cent per annum regardless of the fact whether the land is acquired for the Central Government or the State Government. Since the amendment is subsequent to the acquisition, i. e. , 1963, the rate of interest will be 6 per cent per annum. The Land Acquisition (Madras Amendment) Act, 1953, which reduces the rate of interest from 6% to 4% is applicable only to the lands acquired for the purposes of the State Government. In fact, Boards proceedings, B. P. Mis. No. 1005 dated 2-9-1953 and Government Memo No. 3695-C/50-2, Rev. dated 6-8-1953 issued thereafter clearly demonstrate that the amendment is applicable to cases of acquisition of land for the State Government which is further made clear under Para 21 of B. S. O. 90. That B. S. O. 90 was also adopted by the Andhra Pradesh State Government and continues to be in operation till it is amended by G. O. Ms. 1364 dated 21-11-1966.

( 4 ) IF the intention of the Amendment Act is to make it applicable to the acquisitions for the Central Government also, then the same would have been challenged as discriminatory, as different rates of interest prevailed in different parts of the country. Further, the Government is estopped from questioning para 21 of B. S. O. 90. The said instructions were, in fact, carried out and acted upon till they were amended in 1966. Memo No. 4693-H/61-l-Rev. , dated 1-11-1961 and G. O. Ms. No. 1498 dated 25-9-1962 are only in the nature of correspondence. The review petitions satisfy the grounds mentioned in Order 47, Rule 1, Civil Procedure Code. Further, the decision reported in AIR 1974 Punj and Har (321 ?. . . . . Ed.) referred to in the judgment under review, has no application, as there is no provision similar to para 21 of B. S. O. 90 in that State.

( 5 ) THE counter averments, in brief, are:--The Amendment Act of 1953 does not make any distinction for payment of interest between the lands acquired for the State Government or for the Central Government. Memo No. 4693-H/61-5, Revenue dated 1-11-1961 and thereafter G. O. Ms. No. 1498, Revenue dated 25-9-1962 clarify the position that if the interest is paid at the rate of 6 per cent per annum instead of 4 per cent per annum for lands acquired for Railways Department the excess interest 2 per cent will have to be recovered. It is obviously due to mistake and oversight that Para 21 of Madras B. S. O. 90 was incorporated while preparing the A. P. Land Acquisition Manual in 1965. Para 21 does not provide for payment of interest at a particular rate. On the other hand, it mentions that Section 34 of the Land Acquisition Act provides for payment of interest at 6 per cent per annum if the acquisition is for the purposes of the Central Government, t

Click Here to Read the rest of this document