# Balwan Singh & Anr v. N.H.A.I. & Anr

- **Citation:** (2024) 1 ILRA 773
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2023-12-16
- **Case number:** Writ-C No. 11417 of 2023
- **Bench:** Manoj Kumar Gupta, A.C.J. Donadi Ramesh
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/balwan-singh-anr-v-n-h-a-i-anr-50959
- **Pages:** 12

## Headnote

Sri Pranjal Mehrotra

The Right to Fair Compensation and
Transparency
in
Land
Acquisition,
Rehabilitation and Resettlement Act, 2013
(Act of 2013) to National Highways Act,
1956 (NH Act) - Section 80 -The petitioners
sought interest under Section 80 of the Act of
2013 for delayed payment of compensation for
land acquired under the NH Act - Held, Section
80, providing for interest at 9% per annum (and
15% after one year of delay) on unpaid or
undeposited compensation, applies to NH Act
acquisitions, as it is a beneficial provision,
following Union of India Vs Tarsem Singh
(2019), which struck down Section 3-J of the NH
Act as violative of Article 14 for denying
solatium and interest. (Paras 13, 15, 16, 17)

Constitutional Validity and Article 14 - The
exclusion of solatium and interest under Section
3-J of the NH Act was declared unconstitutional
in Tarsem Singh for creating discriminatory
treatment between landowners under different
statutes - Held, denying interest under Section
80 of the Act of 2013 to NH Act acquisitions
would violate Article 14, as it discriminates
against similarly situated landowners, and the
Central
Government's
notification
dated
28.08.2015 under Section 105(3) extends
beneficial provisions of the Act of 2013 to NH
Act acquisitions. (Paras 13, 14, 15)

Statutory
Framework
-
Interest
on
Compensation - Section 3-H(5) of the NH Act
provides interest at 9% per annum only on
excess
compensation
determined
by
the
Arbitrator, but is silent on interest for delays in
initial compensation payment - Held, Section 80
of the Act of 2013, mandating interest from the
date of possession until payment, is more
beneficial and applies to NH Act acquisitions to
ensure fair compensation, as per the mandate
of Section 105(3) of the Act of 2013. (Paras 5,
6, 10, 16, 17)

Central Government's Notification and
Legislative
Intent
-
The
Central
Government's notification dated 28.08.2015,
issued under Sections 105 and 113 of the Act of
2013, extended provisions for compensation,
rehabilitation, and resettlement to NH Act
acquisitions - Held, this reflects the intent to
provide
uniform
benefits
to
landowners,
ensuring that interest under Section 80 applies
to prevent dilution of compensation rights,
aligning
with
Nagpur
Improvement
Trust
principles. (Paras 12, 14, 16)
Application to Specific Cases - In Writ-C No.
11417 of 2023, petitioners claimed interest for
18 months from the award date (22.09.2020) to
payment date (03.03.2022); in Writ-C Nos.
18478 and 18521 of 2023, petitioners sought
interest from the award date (07.12.2019) to
payment date (30.01.2023) - Held, petitioners
774 INDIAN LAW REPORTS ALLAHABAD SERIES
are entitled to interest under Section 80 of the
Act of 2013 for the delayed periods, and
respondents are directed to calculate and pay
within four weeks. (Paras 2, 18)

Writ Petitions Allowed.

List of Cases cited:

## Text

1 All. Balwan Singh & Anr. Vs. N.H.A.I. & Anr.
773
fair market value as assessed by the Collector.
Thus, the said ground is also rejected.

23. So far as the judgment of this
Court in the case of Smt. Omwati (supra)
is concerned, obviously the same would
give way to the Full Bench judgment of
this Court in the case of Smt. Pushpa
Sareen (supra).

24. Keeping in view the aforesaid
discussion, no case for interference is made
out. Accordingly, the writ petition is
dismissed.
----------
(2024) 1 ILRA 773
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 16.12.2023

BEFORE

THE HON'BLE MANOJ KUMAR GUPTA,
A.C.J.
THE HON'BLE DONADI RAMESH, J.

Writ-C No. 11417 of 2023
with
Writ-C Nos. 18478 of 2023 & 18521 of 2023

Balwan Singh & Anr. ...Petitioners
Versus
N.H.A.I. & Anr. ...Respondents

Counsel for the Petitioners:
Sri Harsh Vardhan Gupta

Counsel for the Respondents:
Sri Pranjal Mehrotra

The Right to Fair Compensation and
Transparency
in
Land
Acquisition,
Rehabilitation and Resettlement Act, 2013
(Act of 2013) to National Highways Act,
1956 (NH Act) - Section 80 -The petitioners
sought interest under Section 80 of the Act of
2013 for delayed payment of compensation for
land acquired under the NH Act - Held, Section
80, providing for interest at 9% per annum (and
15% after one year of delay) on unpaid or
undeposited compensation, applies to NH Act
acquisitions, as it is a beneficial provision,
following Union of India Vs Tarsem Singh
(2019), which struck down Section 3-J of the NH
Act as violative of Article 14 for denying
solatium and interest. (Paras 13, 15, 16, 17)

Constitutional Validity and Article 14 - The
exclusion of solatium and interest under Section
3-J of the NH Act was declared unconstitutional
in Tarsem Singh for creating discriminatory
treatment between landowners under different
statutes - Held, denying interest under Section
80 of the Act of 2013 to NH Act acquisitions
would violate Article 14, as it discriminates
against similarly situated landowners, and the
Central
Government's
notification
dated
28.08.2015 under Section 105(3) extends
beneficial provisions of the Act of 2013 to NH
Act acquisitions. (Paras 13, 14, 15)

Statutory
Framework
-
Interest
on
Compensation - Section 3-H(5) of the NH Act
provides interest at 9% per annum only on
excess
compensation
determined
by
the
Arbitrator, but is silent on interest for delays in
initial compensation payment - Held, Section 80
of the Act of 2013, mandating interest from the
date of possession until payment, is more
beneficial and applies to NH Act acquisitions to
ensure fair compensation, as per the mandate
of Section 105(3) of the Act of 2013. (Paras 5,
6, 10, 16, 17)

Central Government's Notification and
Legislative
Intent
-
The
Central
Government's notification dated 28.08.2015,
issued under Sections 105 and 113 of the Act of
2013, extended provisions for compensation,
rehabilitation, and resettlement to NH Act
acquisitions - Held, this reflects the intent to
provide
uniform
benefits
to
landowners,
ensuring that interest under Section 80 applies
to prevent dilution of compensation rights,
aligning
with
Nagpur
Improvement
Trust
principles. (Paras 12, 14, 16)
Application to Specific Cases - In Writ-C No.
11417 of 2023, petitioners claimed interest for
18 months from the award date (22.09.2020) to
payment date (03.03.2022); in Writ-C Nos.
18478 and 18521 of 2023, petitioners sought
interest from the award date (07.12.2019) to
payment date (30.01.2023) - Held, petitioners
774 INDIAN LAW REPORTS ALLAHABAD SERIES
are entitled to interest under Section 80 of the
Act of 2013 for the delayed periods, and
respondents are directed to calculate and pay
within four weeks. (Paras 2, 18)

Writ Petitions Allowed.

List of Cases cited:

1. Union of India Vs Tarsem Singh, (2019) SCC
OnLine SC 1557

2. Nagpur Improvement Trust Vs Vithal Rao,
(1973) 1 SCC 500

(Delivered by Manoj Kumar Gupta, A.C.J.)

1. The main issue for consideration in
these writ petitions is whether Section 80 of
the Right to Fair Compensation and
Transparency
in
Land
Acquisition,
Rehabilitation and Resettlement Act, 2013
(for short 'the Act, 2013') relating to
payment of interest on delayed payment of
compensation amount would apply to the
acquisitions made under the provisions of
the National Highways Act, 1956 (for short
'NH Act') as amended by the National
Highways Laws (Amendment) Act, 1997.

2. Before we advert to the above
issue, we may note in brief the facts of each
individual case:-

Writ-C No.11417 of 2023

1.
Date of notification under
Section 3-A
(In Gazette)
-18.06.2012
(In Newspaper)
-18.07.2012
2.
Date of notification under
Section 3-D
(In Gazette)
-17.06.2013
(In Newspaper)
-20.08.2013
3.
Date of award
- 22.09.2020
4(a
)
Rs.59,20,163/-
deposited
as compensation
in the account of the
petitioner no.1.
- 03.03.2022
(b) Rs.63,47,648/-
deposited
as compensation in the
account of petitioner no.2.
- 03.03.2022

Note:- The compensation amount
deposited in the account of the petitioners
included interest upto 22.09.2020 i.e. upto
the date of award - petitioners claimed
interest for eighteen months from the date
of award dated 22.09.2022 till date of
actual payment i.e. 03.03.2022 at the rate of
12% per annum (Rs.10,79,100), but which
was not granted.

Writ-C No.18478 of 2023

1. Date
of
notification
under
Section 3-A
(In Gazette)
 - 21.06.2019
(In Newspaper)
- 03.07.2019
2. Date
of
notification
under
Section 3-D
(In Gazette)
- 18.09.2019
(In Newspaper)
- 28.09.2019
3. Date of award
- 07.12.2019
Project
Director,
NHAI
addressed a communication to
Competent Authority mentioning
that financial approval has been
granted to the compensation
amount as per award, except in
case of the petitioners, where the
award was to be challenged
before the Arbitrator.

Award challenged before the
Arbitrator under Section 3-G (5)
- 28.02.2020
Arbitrator rejected the challenge
- 03.01.2021
In Writ-C No.22284 of 2021 filed
by the petitioners, direction was
issued to the respondents to
transfer compensation amount in
- 01.11.2021
1 All. Balwan Singh & Anr. Vs. N.H.A.I. & Anr.
775
the account of the petitioners
within one month provided the
requisite
formalities
are
completed by the petitioners -
the petitioners claim to have
completed all the formalities.
Contempt
Application
(Civil)
No.1966 of 2021 filed by the
petitioners was disposed of by
granting one more opportunity to
the opposite parties to comply
with the order of the Writ Court.
- 05.04.2022

The Competent Authority refused
to pay compensation on the
ground
that
objection
under
Section 34 was pending before
the court.
- 01.06.2022

In Contempt Application (Civil)
No.4125 of 2022 filed by the
petitioner, notice was issued to
the opposite parties.
- 03.12.2022

Competent Authority addressed a
communication to NHAI that
payment
was
made
to
the
petitioners
by
RTGS
on
30.01.2023, but the amount has
not been received from NHAI.
- 02.02.2023

The petitioners filed application
for payment of interest from the
date of award i.e. 7.12.2019 upto
the date of actual payment, but
which request has not been
accepted.
- 18.03.2023

Writ-C No.18521 of 2023

1. Date of notification under
Section 3-A
21.06.2019
 (In Gazette)
(In Newspaper)
03.07.2019
2. Date of notification under
Section 3-D
(In Gazette)
- 18.09.2019
(In Newspaper)
28.09.2019
3. Date of award
- 07.12.2019
Date of possession under
Section 3-E

Project
Director,
NHAI
addressed a communication
to
Competent
Authority
mentioning that approval
has been granted to the
compensation amount as per
award with the exception in
the
case
of
petitioners,
where the award is to be
challenged
before
the
Arbitrator
- 19.05.2020

Award challenged before the
Arbitrator under Section 3G (5)

Arbitrator
rejected
the
challenge
- 03.01.2021

In Writ-C No.22406 of 2021
filed by the petitioners,
direction was issued to the
respondents
to
transfer
compensation amount in the
account of the petitioners
within one month provided
the requisite formalities are
completed by the petitioners
- the petitioners claimed to
have
completed
all
the
formalities.
-01.11.2021

Contempt
Application
(Civil) No.1965 of 2022
filed by the petitioners was
disposed of by granting one
more opportunity to the
opposite parties to comply
with the order of the Writ
Court.
- 05.04.2022

The Competent Authority
refused to pay compensation
on the ground that objection
under
Section
34
was
pending before the court.
- 02.06.2022

Second
Contempt
Application
(Civil)
No.
4124 of 2022 filed by the
petitioners. Notice issued to
opposite parties.
- 03.12.2022
776 INDIAN LAW REPORTS ALLAHABAD SERIES

Competent
Authority
addressed a communication
to NHAI that payment was
made to the petitioners by
RTGS on 30.01.2023, but
the amount has not been
received from NHAI.
-02.02.2023

The
petitioners
filed
application for payment of
interest from the date of
award i.e. 7.12.2019 upto
the date of actual payment,
but which request has not
been accepted.
18.03.2023

Submission of Counsel for the
Parties

3. Learned counsel for the petitioners
made the following submissions: -

(a) The Supreme Court in Union
of India and others Vs. Tarsem Singh
and others1 has declared Section 3-J of NH
Act as unconstitutional, being violative of
Article 14 of the Constitution. It has also
been held that the State cannot be permitted
to discriminate between land owners on
account of difference in Statutes under
which their lands are acquired, as it would
be
violative
of Article
14
of
the
Constitution.

(b) The solatium and interest is
payable to the land owners whose property
is compulsorily acquired as part of
compensation. Any discrimination in this
regard would render the provision relating
to acquisition under the National Highways
Act unconstitutional. The petitioners would
therefore be entitled to interest in case of
delay not only on the compensation amount
enhanced by the Arbitrator [Section 3-H(5)
of the NH Act], but also on the amount
initially determined by the Competent
Authority, by virtue of Section 80 of the
Act, 2013.

4. On the other hand, Sri Pranjal
Mehrotral, learned counsel appearing on
behalf of NHAI submitted as follows:

By virtue of Section 105 (1) of
the Act, 2013, the provisions of the Act
have been made inapplicable to the
enactments relating to land acquisition
specified in the Fourth Schedule. The NH
Act is enlisted at Serial No.7 in the Fourth
Schedule. Therefore, the provisions of the
Act, 2013 would not be applicable nor the
petitioners can claim any interest under
Section 80 of the Act, 2013.

Statutory Regime -

5. A bird's eye view of the relevant old and
new statutory regime would help us in
deciding the controversy. The NH Act
initially did not contain any provision for
acquisition of land even when required for
construction of Highway. The acquisitions
used
to
be
made
under
the
Land
Acquisition Act, 1894 (for short 'the Old
Act'). It was resulting in considerable
delay. In order to expedite the process of
land acquisition where land is required for
construction of National Highways, the
National Highways Laws (Amendment)
Act, 1997 was enacted. By inserting
Sections 3-A to 3-J of NH Act, a parallel
machinery to the existing provisions under
the Old Act was provided for acquisition of
lands for National Highways. Under it,
preliminary notification is made under
Section 3-A declaring intention of the
Central
Government
to
acquire
land
followed by final declaration under Section
3-D. The important feature is that on
publication of declaration under Section 3D, the land vests absolutely in the Central
1 All. Balwan Singh & Anr. Vs. N.H.A.I. & Anr.
777
Government free from all encumbrances
and consequently, the Central Government
is clothed with power to take possession.
Section 3-G is the machinery provision for
determination of compensation and 3-H
stipulates that the Central Government shall
deposit the compensation amount in such
manner as may be laid down by Rules made
in this behalf with the Competent Authority
before taking possession of the land. The
National Highways (Manner of Depositing
the Amount by the Central Government;
Making Requisite Funds Available to the
Competent Authority for Acquisition of
Land) Rules, 2019 lays down the mechanism
in which the compensation amount would be
made available to the Competent Authority. It
mandates that the Executive Agency would
make available the amount determined under
Section 3-G of the Act within fifteen days of
the raising of demand by the Competent
Authority and where the amount determined
by the Arbitrator under sub-section (7) of
Section 3-G of the Act is in excess of the
amount determined by the Competent
Authority, the excess amount, together with
interest, if any, awarded by the Arbitrator
would be deposited within thirty days of the
communication of the Arbitrator's award
unless
such
award
has
been
further
challenged by either of the aggrieved parties.
Rule 4 enlists the circumstances in which the
Competent Authority can deposit unclaimed
or disputed amounts with the principal court
of civil jurisdiction and in which event, it
would be deemed as payment made to the
entitled persons under sub-section (2) of
Section 3-H of the Act. Section 3-H stipulates
that as soon as may be after the amount has
been deposited under sub-section (1), the
Competent Authority shall on behalf of
Central Government pay the amount to the
person or persons entitled thereto. Subsection (5) stipulates that where the amount
determined under Section 3-G by the
Arbitrator is in excess of the amount
determined by the Competent Authority, the
Arbitrator may award interest at 9% per
annum on such excess amount from the
date of taking possession under Section 3D till the date of the actual deposit thereof.

6. Section 80 of the 2013 Act
contemplates that where compensation
amount is not paid or deposited on or
before taking possession of the land, the
Collector shall pay the amount awarded
with interest thereon at the rate of 9% per
annum from the time of so taking
possession until it shall have been so paid
or deposited. The rate of interest is upto
15% per annum where there is delay
beyond one year in making payment.
Section 80 of the Act is extracted below for
ready reference:-

"80. Payment of interest.-When
the amount of such compensation is not
paid or deposited on or before taking
possession of the land, the Collector shall
pay the amount awarded with interest
thereon at the rate of nine per cent. per
annum from the time of so taking
possession until it shall have been so paid
or deposited:

Provided
that
if
such
compensation or any part thereof is not
paid or deposited within a period of one
year from the date on which possession is
taken, interest at the rate of fifteen per cent.
per annum shall be payable from the date
or expiry of the said period of one year on
the amount of compensation or part thereof
which has not been paid or deposited
before the date of such expiry."

7. Chapter X of the Act, 2013 and
Section 80 whereof is part, relates to
payment of the compensation amount.
Section 77 relates to payment or deposit of
778 INDIAN LAW REPORTS ALLAHABAD SERIES
same
in
the
account
of
the
Land
Acquisition
Rehabilitation
and
Resettlement
Authority.
It
reads
as
follows:-

"77. Payment of compensation
or deposit of same in Authority.-(1) On
making an award under Section 30, the
Collector shall tender payment of the
compensation awarded by him to the
persons
interested
entitled
thereto
according to the award and shall pay it to
them by depositing the amount in their
bank
accounts
unless
prevented
by
someone or more of the contingencies
mentioned in Sub-section (2).

(2) If the person entitled to
compensation shall not consent to receive
it, or if there be no person competent to
alienate the land, or if there be any
dispute as to the title to receive the
compensation or as to the apportionment
of it, the Collector shall deposit the
amount of the compensation in the
Authority to which a reference under
Section 64 would be submitted:

Provided
that
any
person
admitted to be interested may receive
such payment under protest as to the
sufficiency of the amount:

Provided further that no person
who has received the amount otherwise
than under protest shall be entitled to
make any application under Sub-section
(1) of Section 64:

Provided
also
that
nothing
herein contained shall affect the liability
of any person, who may receive the
whole or any part of any compensation
awarded under this Act, to pay the same
to the person lawfully entitled thereto."

8. Sections 78 and 79 relate to
investment of money deposited with the
Authority. The said provisions read as
follows:-

"78.
Investment
of
money
deposited in respect of lands belonging to
person incompetent to alienate.-(1) If
any money is deposited in the Authority
concerned under Sub-section (2) of Section
77 and it appears that the land in respect
whereof the same was awarded belonged to
any person who had no power to alienate
the same, the Authority concerned shall-

(a) order the money to be
invested in the purchase of other lands to
be held under the like title and conditions
of ownership as the land in respect of
which such money shall have been
deposited was held; or

(b) if such purchase cannot be
effected
forthwith,
then
in
such
Government of other approved securities as
the Authority concerned shall think fit,

and shall direct the payment of
the interest or other proceeds arising from
such investment to the person or persons
who would for the time being have been
entitled to the possession of the said land,
and such moneys shall remain so deposited
and invested until the same be applied-

(i) in the purchase of such other
lands as aforesaid; or

(ii) in payment to any person or
persons
becoming
absolutely
entitled
thereto.

(2) In all cases of money
deposited to which this Section applies the
Authority concerned shall order the costs of
the following matters, including therein all
reasonable charge and expenses incident
thereon, to be paid by the Collector,
namely:-

(a) the costs of such investments
as aforesaid;

(b) the costs of the orders for the
payment of the interest or other proceeds of
1 All. Balwan Singh & Anr. Vs. N.H.A.I. & Anr.
779
the securities upon which such moneys are
for the time being invested, and for the
payment out of the Authority concerned of
the principal of such moneys, and of all
proceedings relating thereto, except such as
may be occasioned by litigation between
adverse claimants."

"79.
Investment
of
money
deposited in other cases.-When any
money shall have been deposited in the
Authority concerned under this Act for any
cause other than the causes mentioned in
Section 78, the Authority may, on the
application of any party interested or
claiming an interest in such money, order
the
same
to
be
invested
in
such
Government or other approved securities as
it may think proper, and paid in such
manner as it may consider will give the
parties interested therein the same benefit
from it as they might have had from the
land in respect whereof such money shall
have been deposited or as near thereto as
may be."

9. A conjoint reading of Sections 77, 78,
79 and 80 reveals that as soon as award is
made, the Collector is under mandate to
tender payment of the compensation awarded
by him to the persons entitled thereto by
depositing the amount in their accounts
unless prevented by some one or more of the
contingencies mentioned in sub-section (2).
Sub-section (2) permits the Collector to
deposit the amount with the Authority to
which a reference under Section 64 would be
submitted, where the person entitled to
compensation has not consented to receive it
or if there be any person competent to
alienate the land or if there be any dispute as
to title to receive compensation or as to the
apportionment of it.

10. When we compare the provisions
relating to payment of interest under NHAI
Act, 1956 with the provisions under the 2013
Act, it transpires that the provisions under the
Act, 2013 are more beneficial to the land
owners. As already noted, the only provision
for payment of interest under the NH Act is
Section 3-H (5), whereunder interest at the
rate of 9% per annum is payable only on
excess amount determined by the Arbitrator.
The Act is silent in respect of payment of
interest in cases where compensation amount
is not paid or deposited on or before taking
possession of the land in respect of which the
interest is allowable in terms of Section 80 of
the Act, 2013.

Analysis

11. In the above backdrop, we now
proceed to examine the main issue
regarding applicability of Section 80 of the
Act of 2013 to the acquisitions made under
the NH Act.

12. There's no gainsaying that by
virtue of sub-section (1) of Section 105 of
the Act of 2013, the provisions of the Act
do
not
automatically
apply
to
the
acquisitions made under the NH Act.
However, it is noteworthy that under subsection (3), the Central Government is
invested
with
the
power
to
issue
notification for making applicable any of
the provisions of the Act of 2013 relating to
determination
of
compensation
in
accordance with the First Schedule and
rehabilitation and resettlement specified in
the Second and Third Schedules with such
exceptions or modifications as would not
reduce the compensation or dilute the
provisions of the Act of 2013 to the Act
specified in the First Schedule. Section 105
of the Act 2013 reads as follows: -

Section 105. Provisions of this Act
not to apply in certain cases or to apply
780 INDIAN LAW REPORTS ALLAHABAD SERIES
with certain modifications. - (1) Subject
to sub-section (3), the provisions of this Act
shall not apply to the enactments relating to
land acquisition specified in the Fourth
Schedule.

(2) Subject to sub-section (2) of
Section 106 the Central Government may,
by notification, omit or add to any of the
enactments
specified
in
the
Fourth
Schedule.

(3) The Central Government shall, by
notification, within one year from the date
of commencement of this Act, direct that
any of the provisions of this Act relating to
the determination of compensation in
accordance with the First Schedule and
rehabilitation and resettlement specified in
the Second and Third Schedules, being
beneficial to the affected families, shall
apply to the cases of land acquisition under
the enactments specified in the Fourth
Schedule
or
shall
apply
with
such
exceptions or modifications that do not
reduce the compensation or dilute the
provisions
of
this
Act
relating
to
compensation
or
rehabilitation
and
resettlement as may be specified in the
notification, as the case may be.

(4) A copy of every notification
proposed to be issued under sub-section
(3), shall be laid in draft before each House
of Parliament, while it is in session, for a
total period of thirty days which may be
comprised in one session or in two or more
successive sessions, and if, before the
expiry
of
the
session
immediately
following the session or the successive
sessions aforesaid, both Houses agree in
disapproving the issue of the notification or
both
Houses
agree
in
making
any
modification
in
the
notification,
the
notification shall not be issued or, as the
case may be, shall be issued only in such
modified form as may be agreed upon by
both the Houses of Parliament."

13. In Tarsem Singh (supra), the
main issue was whether the provisions
relating to non grant of solatium and
interest to lands acquired under the NH Act
would render the said Act violative of
Article 14 of the Constitution. While
examining the said issue, the Supreme
Court noticed the differences between the
two Acts. One of the important difference
noted by the Supreme Court between the
provisions of the two Acts is regarding
absence of provision under the NH Act
relating to grant of interest except in cases
where
there
is
enhancement
of
compensation amount by the Arbitrator and
that too, only on the amount enhanced. The
Supreme Court also noticed the notification
issued by the Central Government dated
28.08.2015 under Section 105 read with
Section 113 of the 2013 Act which makes
the compensation provisions under the said
Act applicable to the acquisitions under the
NH Act. It was also noticed that there was
specific provision in shape of proviso to
Section 28 under the Old Act whereunder
interest was awardable at the rate of 15%
per annum if such payment was made
beyond one year. It was noticed that before
the 1997 Amendment Act and after coming
into force 2013 Act, solatium and interest
were payable to the land owners in case of
acquisition
for
purposes
of
National
Highways. Bearing in mind the aforesaid
important aspect, it was observed that
denial of solatium and interest was not the
object of the Amendment Act, 1997 and
therefore, the provisions of the NH Act
providing for grant of compensation
without solatium and interest would not fall
within the protective umbrella of Article
31(C) of the Constitution. Accordingly, in
case of infraction of Article 14, the
provision would be rendered illegal.
Resultantly, Section 3-J of the NH Act
which excludes the applicability of the Act
1 All. Balwan Singh & Anr. Vs. N.H.A.I. & Anr.
781
2013 was struck down as violative of
Article 14 of the Constitution. The relevant
extracts from the said judgment laying
down the above proposition are as follows:

"12. The First Schedule to the
said Act provides that solatium equivalent
to 100% of the market value multiplied by
various factors, depending on whether the
land is situated in a rural or urban area,
constitutes
minimum
compensation
package to be given to those whose land is
acquired. The Fourth Schedule to this Act,
to be read along with Section 105,
expressly includes under Item 7, the
National Highways Act, 1956. In Item 9,
this
Schedule
also
includes
The
Requisitioning
and
Acquisition
of
Immovable Property Act, 1952. By a
notification dated 28 th August, 2015
issued under Section 105 read with Section
113 of the 2013 Act, it is provided that the
2013 Act compensation provisions will
apply to acquisitions that take place under
the National Highways Act. The result is
that both before the 1997 Amendment Act
and after the coming into force of the 2013
Act, solatium and interest is payable to
landowners whose property is compulsorily
acquired
for
purposes
of
National
Highways. This is one other very important
circumstance to be borne in mind when
judging the constitutional validity of the
1997 Amendment Act for the interregnum
period from 1997 to 2015.

.....

.....

Even if the Amendment Act, 1997 be
regarded as an Act to carry out the purposes
of Article 39(b), the object of the
Amendment Act is not served by removing
solatium and interest from compensation to
be awarded. It is obvious, therefore, that
the grant of compensation without solatium
and interest is not basically and essentially
necessary to carry out the object of the
Amendment Act, 1997, even if it is to be
considered as an acquisition Act pure and
simple, for the object of the said
Amendment Act as we have seen is to
obviate delays in the acquisition process of
acquiring land for National Highways. On
application of this test as well, it is clear
that the grant of compensation without
solatium and interest, not being basically
and essentially necessary to carry out the
object of the Amendment Act, would not
receive the protective umbrella of Article
31-C and, therefore, any infraction of
Article 14 can be inquired into by the
Court."

14. The Supreme Court also took into
consideration the Ordinance of 2014
making applicable the provisions relating to
compensation,
rehabilitation
and
resettlement under the Act 2013 to the
acquisitions made under the NH Act and a
subsequent notification to the same effect
dated 28.08.2015. Para 38 of the Law
Report which takes notice of the aforesaid
notifications, is extracted below:

"38. It is worthy of note that even
in acquisitions that take place under the
National Highways Act and the 1952 Act,
the notification of 2015 under the new
Acquisition Act of 2013 makes solatium
and interest payable in cases covered by
both Acts. In fact, with effect from 1st
January, 2015, an Amendment Ordinance
No.9 of 2014 was promulgated amending
the 2013 Act. Section 10 of the said
amendment Ordinance states as follows:

"10. In the principal Act, in Section
105,-

(i)
for
Sub-section
(3),
the
following Sub-section shall be substituted,
namely:-

"(3) The provisions of this
Act relating to the determination of
782 INDIAN LAW REPORTS ALLAHABAD SERIES
compensation in accordance with the First
Schedule, rehabilitation and resettlement in
accordance with the Second Schedule and
infrastructure amenities in accordance with
the Third Schedule shall apply to the
enactments relating to land acquisition
specified in the Fourth Schedule with effect
from 1st January, 2015.";

(ii) Sub-section (4) shall be omitted."
It is only when this Ordinance lapsed that
the notification dated 28 th August, 2015
was then made under Section 113 of the
2013 Act. This notification is important and
states as follows:

"MINISTRY OF RURAL
DEVELOPMENT

ORDER

New Delhi, the 28th August, 2015

S.O. 2368(E).- Whereas, the
Right
to
Fair
Compensation
and
Transparency
in
Land
Acquisition,
Rehabilitation and Resettlement Act, 2013
(30 of 2013) (hereinafter referred to as the
RFCTLARR Act) came into effect from 1st
January, 2014;

And whereas, Sub-section (3) of
Section 105 of the RFCLTARR Act
provided for issuing of notification to make
the provisions of the Act relating to the
determination
of
the
compensation,
rehabilitation and resettlement applicable to
cases of land acquisition under the
enactments
specified
in
the
Fourth
Schedule to the RFCTLARR Act;

And
whereas,
the
notification
envisaged under Sub- Section (3) of
Section 105 of RFCTLARR Act was not
issued, and the RFCTLARR (Amendment)
Ordinance,
2014
(9
of
2014)
was
promulgated on 31st December, 2014,
thereby, inter-alia, amending Section 105 of
the RFCTLARR Act to extend the
provisions of the Act relating to the
determination of the compensation and
rehabilitation and resettlement to cases of
land acquisition under the enactments
specified in the Fourth Schedule to the
RFCTLARR Act;

And
whereas,
the
RFCTLARR
(Amendment) Ordinance, 2015 (4 of 2015)
was promulgated on 3rd April, 2015 to give
continuity
to
the
provisions
of
the
RFCTLARR
(Amendment)
Ordinance,
2014;

And
whereas,
the
RFCTLARR
(Amendment) Second Ordinance, 2015 (5
of 2015) was promulgated on 30th May,
2015 to give continuity to the provisions of
the RFCTLARR (Amendment) Ordinance,
2015 (4 of 2015); And whereas, the
replacement
Bill
relating
to
the
RFCTLARR
(Amendment)
Ordinance,
2015 (4 of 2015) was referred to the Joint
Committee of the Houses for examination
and report and the same is pending with the
Joint Committee;

As whereas, as per the provisions of
article 123 of the Constitution, the
RFCTLARR
(Amendment)
Second
Ordinance, 2015 (5 of 2015) shall lapse on
the 31st day of August, 2015 and thereby
placing
the
land
owners
at
the
disadvantageous
position,
resulting
in
denial
of
benefits
of
enhanced
compensation
and
rehabilitation
and
resettlement to the cases of land acquisition
under the 13 Acts specified in the Fourth
Schedule to the RFCTLARR Act as
extended to the land owners under the said
Ordinance;

And whereas, the Central Government
considers it necessary to extend the benefits
available to the land owners under the
RFCTLARR Act to similarly placed land
owners whose lands are acquired under the
13 enactments specified in the Fourth
Schedule; and accordingly the Central
Government keeping in view the aforesaid
1 All. Balwan Singh & Anr. Vs. N.H.A.I. & Anr.
783
difficulties has decided to extend the
beneficial advantage to the land owners and
uniformly apply the beneficial provisions
of the RFCTLARR Act, relating to the
determination
of
compensation
and
rehabilitation and resettlement as were
made
applicable
to
cases
of
land
acquisition under the said enactments in the
interest of the land owners;

Now, therefore, in exercise of the
powers conferred by Sub-section (1) of
Section
113
of
the
Right
to
Fair
Compensation and Transparency in Land
Acquisition,
Rehabilitation
and
Resettlement Act, 2013 (30 of 2013), the
Central Government hereby makes the
following Order to remove the aforesaid
difficulties, namely;-

1. (1) This Order may be called
the Right to Fair Compensation and
Transparency
in
Land
Acquisition,
Rehabilitation and Resettlement (Removal
of Difficulties) Order, 2015.

(2) It shall come into force with
effect from the 1st day of September, 2015.

2. The provisions of the Right to
Fair Compensation and Transparency in
Land
Acquisition,
Rehabilitation
and
Resettlement Act, 2013, relating to the
determination
of
compensation
in
accordance
with
the
First
Schedule,
rehabilitation
and
resettlement
in
accordance with the Second Schedule and
infrastructure amenities in accordance with
the Third Schedule shall apply to all cases
of land acquisition under the enactments
specified in the Fourth Schedule to the said
Act.
[F.No. 13011/01/2014-LRD]

K. P. KRISHNAN, Addl. Secy."

It is thus clear that the Ordinance as
well as the notification have applied the
principle
contained
in
Nagpur
Improvement Trust (supra), as the Central
Government has considered it necessary to
extend the benefits available to landowners
generally under the 2013 Act to similarly
placed
landowners
whose
lands
are
acquired under the 13 enactments specified
in the Fourth Schedule, the National
Highways Act being one of the aforesaid
enactments. This being the case, it is clear
that the Government has itself accepted that
the principle of Nagpur Improvement Trust
(supra) would apply to acquisitions which
take place under the National Highways
Act, and that solatium and interest would
be payable under the 2013 Act to persons
whose lands are acquired for the purpose of
National Highways as they are similarly
placed to those landowners whose lands
have been acquired for other public
purposes under the 2013 Act. This being
the case, it is clear that even the
Government is of the view that it is not
possible
to
discriminate
between
landowners covered by the 2013 Act and
landowners covered by the National
Highways
Act,
when
it
comes
to
compensation to be paid for lands acquired
under either of the enactments. The
judgments delivered under the 1952 Act as
well as the Defence of India Act, 1971,
may, therefore, require a re-look in the light
of this development. 1 In any case, as has
been pointed out hereinabove, the case of
Chajju Ram (supra), has been referred to a
larger Bench. In this view of the matter, we
are of the view that the view of the Punjab
and Haryana High Court is correct, whereas
the view of the Rajasthan High Court is not
correct."

15. In para 41 of the judgment, the
Supreme Court held that the provision
relating to solatium and interest would also
be applicable to cases that arise between
1997-2015. Accordingly, Section 23(1-A)
and (2) and interest payable in terms of
784 INDIAN LAW REPORTS ALLAHABAD SERIES
proviso to Section 28 of the Old Act has
been held to be applicable to acquisitions
made under the NH Act. Para 41 is
extracted below:

"41. There is no doubt that the
learned Solicitor General, in the aforesaid
two orders, has conceded the issue raised in
these cases. This assumes importance in
view of the plea of Shri Divan that the
impugned judgments should be set aside on
the ground that when the arbitral awards
did not provide for solatium or interest, no
Section 34 petition having been filed by the
landowners on this score, the Division
Bench judgments that are impugned before
us ought not to have allowed solatium
and/or interest. Ordinarily, we would have
acceded to this plea, but given the fact that
the Government itself is of the view that
solatium and interest should be granted
even in cases that arise between 1997 and
2015, in the interest of justice we decline to
interfere with such orders, given our
discretionary jurisdiction under Article 136
of the Constitution of India. We therefore
declare that the provisions of the Land
Acquisition Act relating to solatium and
interest contained in Section 23(1A) and
(2) and interest payable in terms of Section
28 proviso will apply to acquisitions made
under
the
National
Highways
Act.
Consequently, the provision of Section 3J
is, to this extent, violative of Article 14 of
the Constitution of India and, therefore,
declared
to
be
unconstitutional.
Accordingly, Appeal @ SLP (C) No.
9599/2019 is dismissed."

16.

Applying
the
principles
enunciated in Tarsem Singh (supra), we
are of considered opinion that provision
relating to interest i.e. Section 80 of the Act
2013 being a more beneficial provision
would apply to acquisitions made under the
NH Act. This also expressly flows from the
mandate of sub-section (3) of Section 105
which
stipulates
that
while
making
applicable
the
provisions
relating
to
compensation,
rehabilitation
and
resettlement under the Act of 2013 to
acquisitions made under various Acts
specified in Schedule-1, the only exception
or modification permissible would be such
as would not reduce the compensation or
dilute the provisions of the Act, 2013.

17. As already noted, the interest
being part of compensation, the more
beneficial provision of 2013, Act relating to
interest i.e. Section 80 on the amount
determined in the first instance (by
Competent Authority under NH Act) would
undoubtedly apply to the acquisitions made
under the NH Act.

18. In the result, all the petitions
succeed and are allowed. The respondents
are directed to calculate the interest as per
the provisions of Section 80 of the Act
2013 and pay the same to the petitioners
within four weeks from the date of the
communication of the instant order.

19. No order as to costs.
----------
(2024) 1 ILRA 784
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 28.11.2023 &
09.01.2024

BEFORE

THE HON'BLE CHANDRA KUMAR RAI, J.

Writ-C No. 25025 of 2023

Smt. Haseena & Ors. ...Petitioners
Versus
State of U.P. & Ors. ...Respondents