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2019 Supreme(Online)(SC) 2969
SUPREME COURT
Aftab Alam, R. M. Lodha, JJ.
Mohamadi and Others v. Union of India
C. A. No. 780 of 2005
Interest on compensation accrues from the date of application, not subsequent judgments, under Section 124A of the Railways Act, 1989.
Headnote:This appeal raised the issue of the commencement of interest accrual on compensation under S.124A of the Railways Act, 1989. The Tribunal directed interest to commence from May 25, 1995; however, the High Court modified this to the date of its judgment on December 2, 2002. The Court relied on precedent, restoring the Tribunal's order for interest from the date of application, concluding that the previous ruling was well-founded. The appeal is allowed with no cost order.
| Table of Content |
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| 1. interest accrual date on compensation (Para 2 , 3) |
| 2. relied upon case for supporting interest accrual (Para 4 , 5) |
| 3. conclusion restoring tribunal's order (Para 6 , 7) |
1. Heard counsel for the appellants and Mr. Harish Chander, senior counsel appearing for the Union of India.
2. This appeal raises a very limited issue as to the day from which interest would accrue on the amount of compensation under S.124A of the Railways Act, 1989 .
3. The Tribunal directed that the compensation amount would carry interest @ 9% p.a. From May 25, 1995, i.e., the date of the application till its payment to the claimant. On appeal, the High Court modified the Tribunal's order and directed that interest would commence not from the date of the application but from the date of the judgment of the Tribunal, which was passed on December 2, 2002.
4. Counsel appearing for the appellants submitted that in Tahazhathe Purayil Sarabi & Ors. v. Union of India & Anr., 2009 KHC 4726 , under similar circumstances, this Court held that the interest would accrue on the compensation amount from the date of the claim application. Learned counsel particularly relied upon paragraphs 37 to 39 of the judgment.
5. We find that the point is well taken and it is supported by the decision of this Court in Tahazhathe Purayil Sarabi.
6. We, accordingly, set aside the order of the High Court and restore the Tribunal's order in regard to the accrual of the interest with effect from the date of the application.
7. The appeal is allowed, but with no order as to costs.
