IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
R RAGHUNANDAN RAO, SUMATHI JAGADAM, JJ.
The National Highways Authority, Rep. by its Chairman and Managing Director – Appellant
Versus
Mallampati Sudha Kumari, W/o. Buchi Babu – Respondent
W.A.No.1043 of 2022
Decided On : 29-07-2025
Judgment :
R. Raghunandan Rao, J.
The land of the 1st respondent, to an extent of 1105 square meters, in R.S.No.143/4A8 of Vuyyuru Village and Mandal, Krishna District, was acquired for the purpose of widening the national highway by the National Highway Authority of India.
2. A notification under Section-3(A) of the National Highway Act, 1956 [for short “the NH Act, 1956”] was issued on 30.07.2017. The notification under Section-3(D) of the NH Act, 1956, was published on 01.06.2018 and on 15.06.2018 in the newspapers. Thereafter, an award was passed, under Section-3(G) of the NH Act, 1956, on 31.08.2019. Under this award, the compensation of Rs.1,81,23,250/- was determined to be paid and the same was also paid on 01.07.2022. There was no dispute regarding these dates. However, there is a dispute as to the date on which the possession of the land was taken. According to the 1strespondent, the possession of the land was taken on 01.06.2018. This is disputed by the acquisition authority who contends that the possession of land was taken only on 21.10.2022, after the payment of compensation.
3. The 1st respondent contending that interest was payable to her on the compensation amount, on account of delay in payment of compensation, had approached this Court by way of W.P.No.25098 of 2022. A Learned Single Judge of this, by an Order dated 12.09.2022, had disposed of the Writ Petition, holding that the possession of the land had been taken over on 01.06.2019 and directed payment of interest from 01.06.2019 to 01.07.2022 @15% per annum.
4. Aggrieved by this Order, the appellants have approached this Court by way of the present Writ Appeal.
5. Sri P. Veera Reddy, learned Senior Counsel appearing on behalf of Sri S.S. Varma, learned Standing Counsel for NHAI, had fairly conceded that the Judgment of the Hon’ble Supreme Court of India, in the case of Union of India & Anr Vs. Tarsem Singh & Ors, (2019) 9 SCC 304 would be applicable and there would be liability for payment of interest on the appellants. However, he would contend that since the compensation was paid on 01.07.2022, prior to the appellants taking possession of the land on 21.10.2022, no interest needs to be paid. He would further contend that the Learned Single Judge, without considering the counter affidavit filed by the appellants, contending that the possession of the land was taken on 21.10.2022, had directed payment of interest, from 01.06.2019 till 01.07.2022.
6. Sri Venkata Rama Rao, learned counsel appearing on behalf of Sri Prathiwada Varun Kumar, learned counsel for the 1st respondent, would contend that the possession of the land was taken on 01.06.2018. He would also contend that even otherwise, interest would be payable from the date of publication of the Section-3D notification, which was on 01.06.2018. He would contend that compensation would be payable from the date of vesting of the land with the State and delay in payment of compensation would have to be compensated by payment of interest. He would contend that the liability to pay interest, under the Land Acquisition Act, 1894 [for short “the LA Act, 1894”] and under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 [for short “the Act, 2013”] arises from the date on which the land is vested in the State. He would contend that the starting point for the calculation of interest starts from the date of notification under Section-3D, as that is the date on which the land is vested with the State.
7. Section-3(J) of the NH Act, 1956, stipulates that the provisions of the LA Act, 1894, would not be applicable. Certain affected persons, affected by non-payment of interest, had approached the Courts, which resulted in the Judgment of the Hon’ble Supreme Court of India, in the case of Union of India & Anr Vs. Tarsem Singh & Ors (2019) 9 SCC 304 . The Hon’ble Supreme Court of India, after considering the fact that no interest would be payable under the provisions
Interest on enhanced compensation under the National Highways Act is payable from the date of notification under Section 3-D, affirming the government's immediate vesting of land.
The liability to pay interest in land acquisition cases commences from the date of taking possession, as clarified by the Supreme Court in Gayabai Digambar Puri v. The Executive Engineer & Ors.
The main legal point established in the judgment is that interest on compensation amount should commence from the date of taking possession of the land.
Point of Law : Section 28 empowers the courts, if it was enhancing the compensation awarded by the Collector, to award interest on the sum in excess of what the Collector had awarded as compensation.
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.