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SUPREME COURT OF INDIA
R.F. Nariman, Surya Kant, JJ.
Union of India & Anr. – Appellants
Versus
Tarsem Singh & Ors. – Respondents
CIVIL APPEAL NO.7064 OF 2019 (ARISING OUT OF SLP (C) NO.9599 OF 2019) CIVIL APPEAL NO.7068 OF 2019 (ARISING OUT OF SLP (C) NO.10210 OF 2019) With CIVIL APPEAL NO.7065 OF 2019 (ARISING OUT OF SLP (C) NO.9600 OF 2019) With CIVIL APPEAL NO.7066 OF 2019 (ARISING OUT OF SLP (C) NO.9602 OF 2019) With CIVIL APPEAL NO.7067 OF 2019 (ARISING OUT OF SLP (C) NO.9604 OF 2019) With CIVIL APPEAL NO.7084 OF 2019 (ARISING OUT OF SLP (C) NO.15478 OF 2019) With CIVIL APPEAL NO.7086 OF 2019 (ARISING OUT OF SLP (C) NO.15482 OF 2019) With CIVIL APPEAL NO.7081 OF 2019 (ARISING OUT OF SLP (C) NO.15472 OF 2019) With CIVIL APPEAL NO.7079 OF 2019 (ARISING OUT OF SLP (C) NO.15470 OF 2019) With CIVIL APPEAL NO.7070-7071 OF 2019 (ARISING OUT OF SLP (C) NOS.15442-15443 OF 2019) With CIVIL APPEAL NO.7104 OF 2019 (ARISING OUT OF SLP (C) NO.21689 OF 2019) (D.NO.18425 OF 2019) With CIVIL APPEAL NO.7101 OF 2019 (ARISING OUT OF SLP (C) NO.21683 OF 2019) (D.NO.18428 OF 2019) With CIVIL APPEAL NO.7090 OF 2019 (ARISING OUT OF SLP (C) NO.15488 OF 2019) With CIVIL APPEAL NO.7072-7073 OF 2019 (ARISING OUT OF SLP (C) NOS.15444-15445 OF 2019) With CIVIL APPEAL NO.7089 OF 2019 (ARISING OUT OF SLP (C) NO.15487 OF 2019) With CIVIL APPEAL NO.7085 OF 2019 (ARISING OUT OF SLP (C) NO.15479 OF 2019) With CIVIL APPEAL NO.7083 OF 2019 (ARISING OUT OF SLP (C) NO.15477OF 2019) With CIVIL APPEAL NO.7087 OF 2019 (ARISING OUT OF SLP (C) NO.15485 OF 2019) With CIVIL APPEAL NO.7082 OF 2019 (ARISING OUT OF SLP (C) NO.15474 OF 2019) With CIVIL APPEAL NO.7102 OF 2019 (ARISING OUT OF SLP (C) NO.21687 OF 2019) (D.NO.18730 OF 2019) With CIVIL APPEAL NO.7078 OF 2019 (ARISING OUT OF SLP (C) NO.15466 OF 2019) With CIVIL APPEAL NO.7074 OF 2019 (ARISING OUT OF SLP (C) NO.15446 OF 2019) With CIVIL APPEAL NO.7075 OF 2019 (ARISING OUT OF SLP (C) NO.15447 OF 2019) With CIVIL APPEAL NO.7103 OF 2019 (ARISING OUT OF SLP (C) NO.21688 OF 2019) (D.NO.19328 OF 2019) With CIVIL APPEAL NO.7080 OF 2019 (ARISING OUT OF SLP (C) NO.15471 OF 2019) With CIVIL APPEAL NO.7076 OF 2019 (ARISING OUT OF SLP (C) NO.15448 OF 2019) With CIVIL APPEAL NO.7077 OF 2019 (ARISING OUT OF SLP (C) NO.15450 OF 2019) With CIVIL APPEAL NO.7105 OF 2019 (ARISING OUT OF SLP (C) NO.21690 OF 2019) (D.NO.19353 OF 2019) With CIVIL APPEAL NO.7088 OF 2019 (ARISING OUT OF SLP (C) NO.15486 OF 2019) With CIVIL APPEAL NO.7069 OF 2019 (ARISING OUT OF SLP (C) NO.14491 OF 2019) With CIVIL APPEAL NO.7092 OF 2019 (ARISING OUT OF SLP (C) NO.21662 OF 2019) (D.NO.20552 OF 2019) With CIVIL APPEAL NO.7110 OF 2019 (ARISING OUT OF SLP (C) NO. 21696 OF 2019) (D.NO.20561 OF 2019) With CIVIL APPEAL NO.7091 OF 2019 (ARISING OUT OF SLP (C) NO.21657 OF 2019) (D.NO.20565 OF 2019) With CIVIL APPEAL NO.7094 OF 2019 (ARISING OUT OF SLP (C) NO.21664 OF 2019) (D.NO.20573 OF 2019) With CIVIL APPEAL NO.7095 OF 2019 (ARISING OUT OF SLP (C) NO.21666 OF 2019) (D.NO.20612 OF 2019) With CIVIL APPEAL NO.7097 OF 2019 (ARISING OUT OF SLP (C) NO.21671 OF 2019) (D.NO.20617 OF 2019) With CIVIL APPEAL NO.7100 OF 2019 (ARISING OUT OF SLP (C) NO.21682 OF 2019) (D.NO.20770 OF 2019) With CIVIL APPEAL NO.7099 OF 2019 (ARISING OUT OF SLP (C) NO.21675 OF 2019) (D.NO.20775 OF 2019) With CIVIL APPEAL NO.7096 OF 2019 (ARISING OUT OF SLP (C) NO.21670 OF 2019) (D.NO.20779 OF 2019) With CIVIL APPEAL NO.7098 OF 2019 (ARISING OUT OF SLP (C) NO.21673 OF 2019) (D.NO.20783 OF 2019) With CIVIL APPEAL NO.7093 OF 2019 (ARISING OUT OF SLP (C) NO.21663 OF 2019) (D.NO.20785 OF 2019) With CIVIL APPEAL NO.7109 OF 2019 (ARISING OUT OF SLP (C) NO.21695 OF 2019) (D.NO.20817 OF 2019) With CIVIL APPEAL NO.7106 OF 2019 (ARISING OUT OF SLP (C) NO.21691 OF 2019) (D.NO.20821 OF 2019) With CIVIL APPEAL NO.7107 OF 2019 (ARISING OUT OF SLP (C) NO.21692 OF 2019) (D.NO.20939 OF 2019) With CIVIL APPEAL NO.7108 OF 2019 (ARISING OUT OF SLP (C) NO.21693 OF 2019) (D.NO.20941 OF 2019)
Decided On : 19-09-2019
(a) Land acquisition law - Solatium - “Solatium” is part and parcel of compensation that is payable for compulsory acquisition of land. (Para 10)
(b) National Highways Act, 1956 - Section 3G (Amendment 1997) r/w section 105, Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (Amendment 2015) - Solatium was payable under Act, 1956 before 1997 amendment and after 2015 amendment to Act 2013. (Para 12)
(c) Constitution of India - Article 31-C, as originally enacted - Assumed to continue to exist - Therefore, the “material resources of the community” would include private property as well. (Para 13)
(d) Constitution of India - Article 31-C - No declaration need be made for a law to be protected under Article 31-C - However, the said law must have a direct and rational nexus with the principles contained in Article 39(b), failing which a law may be denied protection of Article 31-C despite a declaration made in that behalf. (Para 16, 17)
(e) Constitution of India - Article 31-C, 39(b) and 14 r/w Section 3G, National Highways Act, 1956 (Amendment 1997) - Not carrying out purposes of Article 39(b) - Amendment to obviate delays in the acquisition process of acquiring land for National Highways - Grant of compensation without solatium and interest, not basically and essentially necessary to carry out object of the Amendment Act - Amendment Act not protected by Article 31-C - Any infraction of Article 14 can be inquired into by the Court. (Para 18)
(f) Constitution of India - Article 14 r/w section 3G - Amendment to speed up acquisition for national highways - Payment of solatium and interest done away with - No nexus with object of amendment as payment of solatium and interest does not slow down process of acquisition - Solatium and interest cannot be denied on the ground that acquisition is under Act, 1956 and not Act, 1894. (Para 22, 24)
(g) National Highways Act, 1956 - Section 3G(2) r/w section 9, Land Acquisition Act, 1894 - Both Acts contemplate payment of compensation to persons whose easementary rights have been affected by acquisition - Not relevant while considering non-payment of solatium and interest under Act, 1956. (Para 37)
(h) Constitution of India - Article 14 - Not possible to discriminate between landowners covered by Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 and landowners covered by the National Highways Act, 1956 when it comes to compensation to be paid for lands acquired under either of the enactments. (Para 38)
(i) Interpretation of statute - Held, Section 23(1A) and (2) and interest payable in terms of section 28 proviso, Land Acquisition Act 1894 will apply to acquisitions made under the National Highways Act, 1956 - Consequently, the provision of Section 3J, Act 1956 held unconstitutional being violative of Article 14, Constitution of India. (Para 41)
Facts of the case:
A notification dated 24.12.2004 was issued under Section 3A of the National Highways Act, 1956 for acquiring land belonging to the Respondents for the purpose of four-laning National Highway No.1-A on certain stretches of the Jalandhar-Pathankot section as well as the Pathankot-Jammu section falling within the State of Punjab. On 11th July, 2005, the said lands were declared to have vested in the State pursuant to Section 3D(2) of the said Act. On 5th October 2006, the competent authority under the Act passed an Award in which compensation was calculated at Rs.4,219/-per marla or Rs.6.75 lakhs per acre. As this Award was disputed by the Respondents, an Arbitrator was appointed under the Act, who then arrived at a figure of Rs.1.5 lakhs per marla as compensation. As no solatium or interest is provided by the Act, such solatium and interest was not awarded by the Arbitrator.
A Section 34 application filed under the Arbitration Act by the Union of India was dismissed being time-barred. On appeal to the Division Bench the appeal against valuation at the rate of 1.5 lakhs per marla was rejected. The Court then went on to state that despite the fact that no appeal has been filed against the learned Single Judge’s judgment by the owners, yet compensation for acquired land being in the nature of beneficial legislation, they would be bound by an earlier Division Bench judgment which requires the National Highway Authority to pay solatium and, therefore, directed payment of solatium at the rate of 30%, as laid down in the said judgment.
Finding of the Court
Denial of solatium and interest under Act, 1956 is discriminatory. Section 3J is unconstitutional.
Result: All appeals dismissed.
Solatium is part and parcel of compensation payable for compulsory acquisition of land. (!) (!) (!) [1000640260009]
National Highways Act, 1956 originally did not provide for land acquisition; acquisitions were made under Land Acquisition Act, 1894, entitling owners to solatium and interest. [1000640260005]
1997 Amendment to National Highways Act introduced Sections 3A to 3J to expedite land acquisition by vesting land upon declaration under Section 3D, determining compensation via competent authority or arbitration, without solatium or full interest. [1000640260006][1000640260007][1000640260008][p_17 to p_70]
Object of 1997 Amendment was to reduce delays in highway projects through faster acquisition process, not related to distribution of material resources under directive principles. [p_10 to p_15][1000640260017]
Article 31C protection unavailable as 1997 Amendment lacks direct rational nexus with Article 39(b); denying solatium/interest not basically or essentially necessary for Amendment's object. [1000640260012 to 1000640260017][p_83 to p_105]
Denial of solatium and interest under National Highways Act discriminates against similarly situated landowners compared to those under Land Acquisition Act, 1894 or RFCTLARR Act, 2013, violating Article 14. [1000640260018 to 1000640260023][1000640260037]
No reasonable classification based on public purpose or acquiring authority justifies different compensation (excluding solatium/interest) for identical compulsory acquisitions. [1000640260020 to 1000640260023]
Provisions of Land Acquisition Act, 1894 regarding solatium (Sections 23(1A), 23(2)) and interest (Section 28 proviso) apply to acquisitions under National Highways Act; Section 3J unconstitutional to extent it excludes them. [1000640260040][p_163 to p_174]
Post-2013, RFCTLARR Act provisions (including solatium/interest) apply to National Highways Act acquisitions via notifications, confirming non-discrimination. [1000640260010][1000640260011][p_77 to p_80][p_176 to p_198][1000640260037]
Section 3G(2) of National Highways Act provides 10% for affected easement/right of user, but does not compensate for solatium/interest denial; comparable provisions exist under Land Acquisition Act. [1000640260034 to 1000640260036]
All appeals by Union of India dismissed; solatium/interest payable in these cases. [1000640260040][1000640260041]
JUDGMENT :
R.F. NARIMAN, J.
1. Leave granted.
2. A batch of appeals before us by the Union of India question the view of the Punjab and Haryana High Court which is that the non-grant of solatium and interest to lands acquired under the National Highways Act, which is available if lands are acquired under the Land Acquisition Act, is bad in law, and consequently that Section 3J of the National Highways Act, 1956 be struck down as being violative of Article 14 of the Constitution of India to this extent.
3. The facts of one of these appeals may be taken up as illustrative of the points for consideration in all these appeals. In Union of India & Anr. vs. Tarsem Singh & Ors. (Civil Appeal No. 7064 of 2019 @ SLP (C) No.9599 of 2019), a notification dated 24.12.2004 was issued under Section 3A of the National Highways Act, 1956 (hereinafter referred to as “the Act”), intending to acquire land belonging to the Respondents for the purpose of four-laning National Highway No.1-A on certain stretches of the Jalandhar-Pathankot section as well as the Pathankot-Jammu section falling within the State of Punjab. On 11th July, 2005, the said lands were declared to have vested in the State pursuant to Section 3D(2) of the said Act. On 5th October 2006, the competent authority under the Act passed an Award in which compensation was calculated at Rs.4,219/-per marla or Rs.6.75 lakhs per acre. As this Award was disputed by the Respondents, an Arbitrator was appointed under the Act, who then arrived at a figure of Rs.1.5 lakhs per marla as compensation. It is important to note that as no solatium or interest is provided by the Act, such solatium and interest was not awarded by the learned Arbitrator. Meanwhile, a Section 34 application filed under the Arbitration Act by the Union of India was dismissed on the ground that it was hopelessly time-barred. On appeal to the Division Bench of the High Court, it was found on facts that as the amount of compensation awarded was not challenged in certain cases, the National Highways Authority of India being “State” under Article 12 of the Constitution cannot be permitted to pick and choose between persons similarly situate, as a result of which the appeal against valuation at the rate of 1.5 lakhs per marla was rejected. However, the Court deleted the grant of severance and 18% interest if the awarded amount is not paid within six months, following an earlier Division Bench judgment of the same Court. The Court then went on to state that despite the fact that no appeal has been filed against the learned Single Judge’s judgment by the owners, yet compensation for acquired land being in the nature of beneficial legislation, they would be bound by an earlier Division Bench judgment which requires the National Highway Authority to pay solatium and, therefore, directed payment of solatium at the rate of 30%, as laid down in the said judgment.
4. Shri Shyam Divan, learned Senior Advocate appearing on behalf of the Union of India and NHAI, took us through the relevant provisions of the Land Acquisition Act, 1894 as well as the National Highways Act. According to him, the National Highways Act is a complete Code which expressly excluded the application of the provisions of the Land Acquisition Act, and this being so, it is clear that absent discrimination or manifest arbitrariness, the non-award of solatium and interest that is awardable under the Land Acquisition Act would not fall foul of Article 14 of the Constitution of India. According to the learned Senior Advocate, it is not possible to choose between one Acquisition Act and another, as the National Highways Act alone would apply when land is acquired for the purpose of National Highways. This being the case, all the judgments that are cited by the Punjab and Haryana High Court in M/s Golden Iron and Steel Forging vs. Union of India 2011 (4) RCR (Civil) 375, would, therefore, not apply. According to him, the Division Bench of the Rajasthan High Court in Banshilal
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