REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.    1751          OF 2009 (Arising out of SLP (C) No. 2113 of 2007)

D.D.A.  ……Appellant

Versus

Mahender Singh and Anr. …Respondents

WITH  

CIVIL APPEAL NO.    1752          OF 2009 (Arising out of SLP (C) No. 7484 of 2007)

CIVIL APPEAL NO.      1753        OF 2009 (Arising out of SLP (C) No. 7485 of 2007)

J U D G M E N T

Dr. ARIJIT PASAYAT, J.

1. Leave granted.

2. Challenge in these appeals is to the judgment of a Division Bench of

the Delhi High Court allowing the Writ Petitions filed by respondents under

Article 226 of the Constitution of India, 1950 (in short the ‘Constitution’).

Prayer in  the writ  petitions  was to  direct   the  present  appellant  to  make

payment of statutory interest under Section 34 of the Land Acquisition Act,

1894 (in short the ‘Act’) for the acquisition of the land in terms of the award

No.3/1997-98 dated 10.12.1997.  The appellant  resisted the claim on the

ground that such a prayer cannot be accepted in the writ petitions. The High

Court,  however,  held  that  the  writ  applications  were  to  be  allowed.

Accordingly, it directed the respondents in the writ petitions including the

present  appellant  to pay the interest  payable to the claimants in terms of

Section 34 of the Act and pay costs of Rs.10,000/- .   

3. In support of the appeals, learned counsel for the appellant submitted

that the direction given by the High Court is clearly contrary to a Full Bench

judgment of the Delhi High Court in  Net Ram and Anr. v.  Union of India

and Ors. (86 (2000) DLT 606).  

4. Learned counsel for the respondents on the other hand supported the

judgment  and  submitted  that  in  the  background  of  public  accountability

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which has been highlighted by the High Court, the relief has been rightly

granted.

5. The Act is  a complete Code and lays down detailed procedure for

acquisition  of  land,  payment  of  compensation  including  solatium  and

additional  market  value.  It  is  to  be  noted  that  under  Section  34  interest

@9% from the date of taking over the possession till payment for the first

year @15% for subsequent years is payable. Section 28 is the only other

provision  which  deals  with  the  award  of  interest.  The  said  provision

empowers the Court to award interest on the excess amount awarded over

and above the amount awarded by the Collector.

6. Sections 28 and 34 read as follows:

“28.  Collector  may  be  directed  to  pay  interest  on excess compensation-If the sum which in the opinion of the  court,  the  Collector  ought  to  have  awarded  as compensation is in excess of the sum which the Collector did award as compensation, the award of the Court may direct that the Collector shall pay interest on such excess at the rate  of (nine percentum) per annum from the date on which he took possession of the land to the date of payment of such excess into Court.

34. Payment  of  interest-  When  the  amount  of  such compensation  is  not  paid  or  deposited  on  or  before

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taking possession of the land, the Collector shall pay the amount awarded with interest thereon at the rate of nine per  centum   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  15% per  annum shall  be  payable  from that  date  of 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. There is no dispute that apart  from Sections 28 and 34 which deal

with payment of interest to persons entitled to receive compensation, there

is  no  other  provision  envisaging  payment  of  interest.  Collector,  Land

Acquisition is liable to pay interest on statutory rates to such persons only

when  possession  has  been  taken  over  before  the  payment  of  the  entire

compensation to them under Section 34. In  Union of India v.  Budh Singh

(1995 (6) SCC 233,) this Court had the occasion to deal with Sections 28

and 34 and it was observed that these were the only provisions which deal

with the payment of interest to land owners. While considering the scope

and ambit of the Sections, this Court observed:

“Thus, it could be seen that the statute covers the entire field of  operation of  the liability of  the State to make payment of interest and entitlement thereof by the owner when land has been taken over and possession in

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consequence thereof, the land owner was deprived of the enjoyment thereof. Thus, it could be seen that the Court  

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8. Similar view was expressed in State of Himachal Pradesh v. Dharam

Das (1995 (5)  SCC 683).  It  was held  that  when the statute  provides  for

payment  of  interest  to  the  land  owners,  a  Court  has  no  power  to  award

interest  in  a  manner  other  than  the one prescribed  by the statute.  It  was

specifically observed that there is no other provision empowering the Court

to award interest on equitable ground as equitable consideration has no role

to play in determination of the compensation and the manner of awarding

interest as enjoined under the Act. The same has to be administered in the

manner laid in the Act and in no other way. As a concomitance, the equity

jurisdiction of the court is taken out and the Act enjoins the Court to grant

interest as per the statutory rates specified in the Act. A plea was taken in a

case  before  this  Court  in  a  matter  relating  to  Jammu  and  Kashmir

Requisitioning  and  Acquisition  of  Immovable  Property  Act,  1968  which

omitted provision for payment of solatium and interest, that in spite of the

absence of the provision for solatium and interest in the said Act, the State

was bound to  pay solatium and interest  to  the  land owners  on  equitable

grounds.  This  Court  negatived the  contention.  It  was observed that  there

was no substance in the plea that by legislative omission to pay solatium the

has no power to impose any condition to pay interest in excess of the rate and manner prescribed by the statute as well as for a period

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State enriches itself unjustly at the expense of the private party. (See Union

of India v.  Dhanwanti Devi and Ors. (1996 (5) SCC 44). In Ashok Nagar

Plot Holders Association v. State of U.P. (1997 (10) SCC 77) this Court

again observed that liability to pay interest  to the claimant arises only in

accordance with Section 34 of the Act. As the Act is a self-contained Code,

common law principles  of justice,  equity and good conscience cannot be

extended  in  awarding  interest,  contrary  to  or  beyond  provisions  of  the

statute.  

9. In  view  of  what  has  been  indicated  above,  the  conclusion  is

irresistible  that  while  exercising  jurisdiction  under  Article  226  of  the

Constitution there is no scope for direction to pay interest in a manner not

contemplated by either Section 28 or 34.  

10. In view of the above the appeals  deserve to  be allowed which we

direct. The impugned judgments of the High Court are set aside.  

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…………………………….J. (Dr. ARIJIT PASAYAT)

…………………………..J. (ASOK KUMAR GANGULY)

New Delhi, March 20, 2009

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