When land acquisition authorities take possession of property, they are statutorily liable to pay interest on the compensation awarded for the period of delay until payment, regardless of whether the final compensation amount was determined or revised through subsequent judicial intervention.

THESE WRIT PETITIONS HAVING BEEN HEARD AND RESERVED FOR ORDERS, COMING ON FOR PRONOUNCEMENT THIS DAY, THE COURT MADE THE FOLLOWING:-

CORAM: THE HON'BLE MR JUSTICE M.NAGAPRASANNA

CAV ORDER

Both these petitions rank a common string of relief viz., denial of interest on payment of compensation for the period between the date of agreement between the petitioners and the Karnataka State Highways Authorities and, till the date of payment of compensation.

2. Heard Smt. Archana A. Magadum, learned counsel appearing for the petitioners and Smt. Girija S. Hiremath, learned High Court Government Pleader appearing for the respondents.

3. For the sake of convenience, the facts obtaining in Writ Petition No.104133 of 2025 would be narrated:

3.1. The petitioners are the joint owners of non-agricultural land in R.S.No.128/3B situate at Gadag measuring 2 acres 20 guntas. A notification comes to be issued under Section 15 of the Karnataka Highways Act, 1964 (hereinafter referred to as ‘the Act’ for short) notifying the lands of the petitioners to an extent of 16 guntas 08 annas out of 2 acres 20 guntas. The 1st respondent/Special Land Acquisition Officer acquires the notified land and the Chief Project Officer of the Project Implementation Unit of the Karnataka State Highways Development Project fixes the market value of the acquired land at ₹874/- per sq. ft. The market value of the petitioner’s land is subsequently enhanced to ₹1,093/- per sq. ft. on the score that it is a commercial land. In furtherance of the notification under Section 15 of the Act, the petitioners enter into an agreement with the Land Acquisition Officer accepting the market value so determined on 18-11-2014. Three years thereafter, a notification comes to be issued under Section 19 of the Act. The petitioner’s land which was found to be acquired as 16 guntas 8 annas out of 2 acres 20 guntas was now reduced to 10 guntas and the remaining 6 guntas 8 annas is shown as Government road. Pursuant to the said notification under Section 19 of the Act, on 26-08-2019, an award is passed for the land acquired through the preliminary and the amended notification maintaining the acquisition as found in the notification under Section 19.

3.2. On 30-08-2019, the 1st respondent/Special Land Acquisition Officer deposits the award amount to the bank account of the petitioners only to the extent of 10 guntas out of 16 guntas 8 annas. The petitioners then submit a representation seeking compensation for the remaining extent, as it was acquired pursuant to the notification under Section 15 and the land was neither usable by the petitioners nor salable, as agreement was entered into accepting the market price on 18-11-2014. When the representation went unheeded, the petitioners were before the Court in two writ petitions viz., W.P.No.147609 of 2020 c/w 147610 of 2020 seeking a direction to re-determine the compensation. The writ petitions come to be disposed of by a common order dated 11-01-2024 directing the respondents to re-determine the compensation, taking into account the revised market value of the subject land, which at that point in time was ₹1093/- per sq. ft. as against ₹874/- per sq. ft. determined in the year 2014.

3.3. A consent award comes to be passed on 06-06-2024 pursuant to the direction issued by the coordinate Bench of this Court and accordingly, the difference in compensation amount of ₹3,97,66,603/- was directed to be paid to the petitioners. The petitioners now claim that they are entitled for interest on such delayed payment, from the date of agreement till the date of grant of compensation. An endorse