Kamalam vs State of Kerala

P. Bhavadasan, J.—Under challenge is the order dated 8.4.2005 in E.P.491 of 1991 in L.A. 62 of 1986 whereby the court below has held that an excess amount of Rs. 66,075.86 has been deposited by State and accordingly full satisfaction of the decree was recorded and the execution petition was closed. The essential facts necessary for the disposal of this writ petition are as follows:

An extent of 0.2240 hectares of land in Sy. No. 167/6-7 of Nattika Village in Chavakkad Taluk was acquired as per notification dated 10.12.1983. Possession was taken on 12.8.2003. An award was passed on 12.8.1983 granting compensation at the rate of Rs. 1,430/- per cent. An amount of Rs. 90,703.53 with 15% solatium was awarded. The petitioner/claimant sought for enhancement and reference was sought for by the claimant. The Reference Court by order dated 27.10.1988 enhanced the compensation to Rs. 4,500/- per cent and granted attendant benefits available under the Statute. A sum of Rs. 6,393/- was awarded towards the value of building items. Execution of the award was taken out by the claimant. Taking note of the deposits made by the respondent State, full satisfaction was recorded and the execution petition was dismissed on 7.7.2001. The decree holder carried the matter before this Court in C.R.P. 2687 of 2011. This court allowed the revision petition and the matter was remitted to the execution court in view of the decision reported in Sundar v. Union of India (2001 (2) KLT 449). In terms of the order of this court, both the Government as well as the claimant filed statements.

In the impugned order, it is seen stated that towards the enhanced amount, the State had deposited a sum of Rs. 2,00,000/- on 29.3.1994 and Rs. 1,00,000/- on 30.3.1994. On 2.6.1994 a sum of Rs. 1,00,000/- was deposited, on 10.10.1994 Rs. 1,00,000/- was deposited and on 18.2.1995 a sum of Rs. 1,00,000/- was deposited. On 15.2.2000 a sum of Rs. 1,36,202/- was deposited. Statement was filed by the State on the basis of the decision in State of Kerala Vs. Mariyamma, . As per the said decision, the amount deposited shall be first adjusted towards the land value and solatium and the balance amount has to be adjusted towards the interest. On the basis of the principle laid down in the above decision, the court below came to the conclusion that an excess of Rs. 66,075.86 is deposited and no amount is due to the claimant.

Sri. S.V. Balakrishna Iyer, learned Senior Counsel, points out that the decision relied on by the court below reported in State of Kerala''s case (supra) has been reviewed in the decision reported in State of Kerala Vs. Mariyamma, . In paragraphs 20 and 21 of the judgment it is stated as follows:

In P. Ram Reddy and Others Vs. Land Acquisition Officer, Hyderabad Urban Development Authority, Hyderabad and Others, , the Apex Court found that additional amount payable under sub-s.(1A) and solatium under sub-s.(2) refer to market value of land awardable under first clause of S.23(l) and solatium is not payable in respect of amount awardable under sub-s.(1A). It was held as follows:--

It has also to be noted that solatium under sub-s. (2) is not payable in respect of the amount awardable under sub-s.(1A), in that, sub-s.(2) says that in addition to the market value of the land, as above provided, the Court shall in every case award a sum of thirty per centum on such market value, in consideration of the compulsory nature of the acquisition.

In Sunder and Others Vs. Union of India (UOI) , the Apex Court held as follows:--

There can be no doubt that all the three heads specified in the three sub-sections in S.23 are the sums to be "awarded by the Court". Hence the words "every award under this Part" cannot be treated as the award after delinking the amounts awarded under sub-s.(1-A) or sub-s.(2) of S.23". It was further held that the compensation awarded would include not only the total sum arrived at as per sub-s.(1) of S.23, but the remaining sub- sections thereof as well. In Nagpur Improvement Trust Vs. Vasantrao and Others and Jaswantibai and Others, , the Supreme Court followed the principle laid down in Sunder''s case (supra) and found that the claimants are entitled to interest on the amount payable to them under sub-s.(1A) of S.23 of the Act and judgment debtors were directed to compute and pay the interest payable to the claimants in accordance with law as enunciated in Sunder''s case (supra). So, the claimants are entitled to interest on the additional amount calculated at the rate of 12 per centum per annum awarded.

In Mir Fazeelath Hussain and others Vs. Special Deputy Collector Land Acquisition, Hyderabad [OVERRULED], , the Apex Court held that the solatium is not part of the award and no interest is claimable thereon. The principle laid down in that decision was overruled by a Constitution Bench of the Supreme Court consisting of five Judges in Sunder and Others Vs. Union of India (UOI) , in which it was held that solatium is also part of the award and interest is payable on that amount. After the pronouncement of the decision in Sunder''s case (supra), the parties are entitled to get interest on solatium also. But the executing Court shall consider whether the decree in a given case allows the decree holder to claim interest on solatium. It is well settled position of law that the parties to the case are governed by the terms of the decree. If the decree does not provide for payment of interest on solatium, the claimant cannot claim interest on solatium. That position was clarified in the decision reported in K.R. Amrith Raj v. The Special Tahsildar, 2002 (3) KLT 365.

In paragraph 39 of the said decision, it was further observed as follows:

So, the law regarding adjustment of the decree amount deposited by the State in execution of a decree passed in a land acquisition reference is clear and settled. The decree holder shall calculate the various amounts due to him under Ss.23(1), 23(1-A), 23(2) and 28 of the Act.

They are the following:--

(i) The amount of compensation awarded by the Land Acquisition Officer.

(ii)The amount of 12% per annum on the market value of the land determined under first clause of sub-s.(1) of S.23 for the period between the date of publication of notification and the date of award of the Collector or the date of taking possession of land whichever is earlier.

(iii) Solatium due under S.23(2) of the Act.

(iv) Simple interest payable to the claimants on the above three heads in accordance with law as enunciated in Sunder''s case (supra).The State shall also file a statement showing the split up details of each components separately at the time of deposit of the amount under the decree. If any amount is deducted as Income Tax, necessary Tax Deduction Certificate shall be either given to the party directly or produced before Court to be handed over to the decree holder. The executing Court shall first adjust the amount deposited towards compensation due to the claimant under Ss.23(1), (1A), (2) and thereafter towards the interest payable under S.28. If the amount deposited is sufficient to discharge the amounts awarded under Ss.23(1), (1A) and (2) of the Act, no further interest will accrue on such amounts. If the amount deposited is not sufficient to discharge additional compensation awarded under Ss.23(1), (1A) and (2) of the Act, simple interest for the balance amount alone is payable. But, no further interest will accrue on the interest payable under S.28 of the Act.

The issue regarding appropriation of the amount deposited by the State was considered in the decision reported in Gurpreet Singh Vs. Union of India (UOI), . The Apex Court considered the manner of appropriation of deposits made at the various stages of the proceedings. The first stage occurs at the time when the award is passed. The second stage occurs on an award being passed by the Land Acquisition Court, the third stage occurs when the enhancement by the High Court and the fourth stage occurs when the Apex Court passes an award in the matter.

We are here concerned with the second stage. In paragraph 33 of the said decision it was held as follows:

The second stage occurs on a reference u/s 18 of the Act. When the Reference Court awards enhanced compensation, it has necessarily to take note of the enhanced amounts payable u/s 23(1), Section 23(1-A), Section 23(2) and interest on the enhanced amount as provided in Section 28 of the Act and costs in terms of Section 27. The Collector has the duty to deposit these amounts pursuant to the deemed decree thus passed. This has nothing to do with the earlier deposit made or to be made under and after the award. If the deposit made, falls short of the enhancement decreed, there can arise the question of appropriation at that stage, in relation to the amount enhanced on the reference.

Going by the order of the court below, it is seen that the amounts were deposited in instalments and not in lumpsum and therefore the principle laid down in the above decision is squarely applicable to the facts of the case and held that the claimant is entitled to appropriation as envisaged and laid down by the Apex Court in the above decision. While making the appropriation, the claimant is entitled to apply the amount deposited first towards the satisfaction of his claim towards interest on the enhanced amount, the costs, if any, awarded and the balance towards the land value, solatium and the payment u/s 23 (1-A) of the Act and if there is a shortfall, claim that part of the compensation with interest thereon as provided in Section 28 of the Act and as covered by the award decree. In view of the decision of the Apex Court in Gurpreet Singh''s case (supra) and of this court in State of Kerala Vs. Mariyamma, , the order passed by the court based on the decision reported in State of Kerala Vs. Mariyamma, does not appear to be correct. The issue as to whether any further amount is due to the claimant will have to be considered afresh.

In the result, this writ petition is allowed, the impugned order is set aside and the matter is remanded to the lower court for fresh disposal in accordance with law and in the light of what has been stated above. The lower court may dispose of the matter within four months from the date of receipt of a copy of this judgment.

Forward a copy of this judgment to the lower court.