PUNJAB AND HARYANA HIGH COURT AT CHANDIGARH
PANKAJ JAIN, J.
Government of India And Another – Appellant
Versus
Bhajan Lal And Others – Respondent
CR-289-2021 (O&M), CR-290-2021 (O&M), CR-716-2020 (O&M), CR-19-2021 (O&M), CR-22-2021 (O&M), CR-892-2020 (O&M), CR-97-2021 (O&M) and CR-346-2021 (O&M)
Decided on : 23-07-2025
JUDGMENT :
Pankaj Jain, J. (Oral)
1. This is a bunch of eight petitions. All these petitions are being disposed off by a common order as they involve same question of law in the backdrop of similar facts related to compulsory acquisition of land owned by respondents at the hands of petitioner/State.
2. The sole question involved in the present bunch of petitions is:
From which date the interest on compensation is payable to the land owner whose land has been acquired compulsorily invoking the provisions of National Highways Act, 1956 (hereinafter referred to as 'the 1956 Act')?
3. Counsel for the petitioner Highway Authority has relied upon judgment rendered by Division Bench of this Court in the case of 'M/s Golden Iron and Steel Forging vs. Union of India and others', 2011(4) RCR (Civil) 375 to submit that the land owners vis-a-vis acquisition proceedings under different statutes have to be dealt at par. He submits that it is on the said ground that Section 3J of the 1956 Act was struck down as ultra vires by Writ Court. He submits that once the parity between the acquisition proceedings under 1956 Act and that under the Land Acquisition Act, 1894 (hereinafter referred to as 'the 1894 Act') has been recognized by the Court, the interest shall accrue from the date of award as contemplated under Section 28 of the 1894 Act which provides for accrual of interest on compensation from the date the possession is taken. He further refers to Section 3H(1) to submit that since the authorities are entitled to take possession only after deposit of amount determined under Section 3G thus, the interest shall accrue from the date award is made, i.e. when the State becomes entitled to enter into possession. He submits that any other interpretation would amount to creating classification amongst the land owners vis-a-vis different acquisition proceedings and will thus be in violation of Article 14 of the Constitution of India.
4. Per contra, counsel for the land owners refers to Section 3H(5) to submit that the interest @ 9% per annum has to be paid on the excess amount from the date of taking of possession under Section 3D till the date of actual deposit. Reliance is being placed upon ratio of law laid down in the case of 'National Highway Authority of India, Project Implementation Unit vs. Champalal Najlya Pawara and others', 2024(6) BCR 38 and 'Special Land Acquisition Officer & Competent Authority (Formerly Manager Technical & Competent Authority for Land Acquisition) National Highway Authority of India vs. Sri Balappa Bharmappa Gasti' - Civil Revision Petition No. 100118 of 2018 decided on 19th of December, 2018.
5. I have heard counsel for the parties and have carefully gone through records of the case.
6. Counsel for the petitioner has heavily relied upon judgment rendered by Division Bench of this Court in M/s. Golden Iron and Steel Forging's case (supra).
7. In the said case, challenge was laid to the vires of Act No. 16 of 1997 whereby 1956 Act was amended. One of the grounds of challenge was that though the Amending Act provides for acquisition of land by the Central Government for the National Highway Authority, but the same does not provide for payment of statutory benefits namely solatium and interest as payable under the Land Acquisition Act. The plea raised was that since the purpose of acquisition is public under 1894 Act as also under 1956 Act, the State cannot differentiate between land owners whose land is acquired under the 1956 Act qua those whose land stands acquired under 1894 Act. It was contended that Section 3G of the Act violates the provisions of Article 14 of the Constitution of India and is thus ultra vires. Division Bench while striking down Section 39 of 1956 Act as ultra vires observed as under:
'61. Thus, the essential principles that emerge from a reading of the aforementioned precedents, are:-
(a) the public purpose shall not determine the amount of compensation;
(b) it is immaterial whether land is acquired under on
Acquisition of land – Constitutional guarantee of just compensation cannot be rendered contingent upon magnitude of financial burden – Mere escalation in projected liability, howsoever significant, d....
Section 94 of 2013 Land Acquisition Act inapplicable to Highways Act acquisitions; only specified schedules for compensation, R&R apply. Belated claims post-award cannot halt projects, but affected u....
The compensation for land acquisition under the National Highways Act must include solatium and interest as per the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and....
The right to demand full acquisition under Section 94 of the 2013 Act applies to acquisitions under the National Highways Act, ensuring just compensation and rehabilitation for affected landowners.
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 right to compensation arises on land vesting with the State, while its quantification may occur later, with interest payable until deposited.
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