HON'BLE SRI JUSTICE ABHINAND KUMAR SHAVILI AND HON’BLE SMT. JUSTICE TIRUMALA DEVI EADA JUDGMENT: (per Hon’ble Smt. Justice Tirumala Devi Eada)

This appeal, under Section 54 of the Land Acquisition Act, 1894, (for short ‘the Act’) is preferred by the Special Deputy Collector, L.A.Cum Loc Unit, SRSP, Pochampad, aggrieved by the order and decree dated 22.08.2006 passed in O.P.No.421 of 2002 by the learned District Judge at Nizamabad (hereinafter referred to as ‘the reference Court’).

2. For convenience and clarity, the parties herein are referred to as they were arrayed before the reference Court.

3. The facts of the case in brief are that the Government has acquired house sites, structures etc., in Ummeda Village of Nandipet Mandal, Nizamabad District for Pochampad Project. A draft notification under Section 4(1) of the Act was published in A.P.Gazette on 27.10.1977. The Land Acquisition Officer has passed the award on 23.03.1978.

4. The case of the claimants is that they are residents of Ummeda village of Nandipet Mandal and the house sites, structures, drinking water wells etc., situated in Ummeda village were acquired by the Land Acquisition Officer and that dissatisfied with the meager amount of compensation, some people from their village filed protest application under Section 18 of Act and the matter was referred to the Court of Additional District Judge, Nzamabad in O.P.No.212 of 1990 and that after due enquiry, the Additional District Judge, Nizamabad has enhanced the compensation and also has awarded solatium and interest on the enhanced amount vide judgment and decree dated 30.09.1994. Aggrieved by the said award, the Land Acquisition Officer has preferred an appeal in A.S.No.1902 of 1995 which was dismissed by the High Court on 26.12.1997.

5. The claimants in the present case who have not availed to file protest application under Section 18 of the Act have approached the Land Acquisition Officer under Section 28-A and requested him to re-determine the compensation for their acquired properties, in terms of the above said order of the Additional District Judge, Nizamabad. Finally, the Land Acquisition Officer has passed an award No.41/98-99 dated 18.01.1999 withholding the payment of interest on solatium, which is illegal and contrary to law and that the Land Acquisition Officer has arbitrarily calculated the interest on the enhanced compensation only up to 28.09.1998 though he passed the award on 18.01.1999 and that the cheques were honoured by the bank on 16.03.1999 and thus, the Land Acquisition Officer ought to have calculated the interest up to 16.03.1999. Thus, their application was referred to the District Judge, Nizamabad.

6. The reference Court has framed the following issues for adjudication:

“1. Whether the claimants are entitled for payment of interest on solatium?

2. Whether the claimants are entitled for payment of interest both on market value and solatium from 23.03.1978 to 22.03.1979 for one year at the rate of 9% and from 23.03.1979 to 16.03.1999 at the rate of 15% per annum but not upto 28.09.1998 as contended by the Land Acquisition Officer?

3. Whether the claimants are entitled to payment of equitable interest at the rate of 18% on the accumulated interest in order to set off the loss and compensate on the ground of equity and justice from 17.3.1999 to till date?”

7. At the time of trial, PW1 was examined and Exs.A1 and A2 were marked on behalf of the claimants and on behalf of the respondents, RW1 was examined and Ex.B1 was marked.

8. Based on the evidence on record, the reference Court has ordered to pay the interest on solatium as per the orders in O.P.No.212 of 1990 and also directed to calculate and pay the interest on the market value and solatium up to 16.03.1999, the date on which the cheques were honoured by the S.B.H @15% per annum as per the L.A.Act and further directed to pay interest @12% per annum on the accumulated interest by way of equitable interest from 17.03.1999 till the payment. Aggr