Special Tahsildar (LA) vs Melath Chathukutty Nair

K.A. Abdul Gafoor, J.—Based on a notification dated 26.8.1992 u/s 4(1) of the Kerala Land Acquisition Act, 1894 acquisition proceedings started in respect of the land owned by the claimant. The land extends about 0.1154 hectare. The Land Acquisition Officer awarded Rs. 7,300/- per Acre. The owner claimed Rs. 8,000/- per cent and the matter was referred. Before the reference court neither party adduced any evidence. Accordingly, the reference court did not grant any enhancement, but it directed payment of interest on the amount paid as per award dated 26.8.1993 u/s 28 with effect from 10.8.1988 a date far earlier than the date of notification u/s 4(1).

In the appeal by the State, it is submitted by the learned Government Pleader that awarding of interest by the Land Acquisition Officer u/s 34 or the direction to pay interest by the reference court u/s 28 of the Land Acquisition Act shall be with reference to the date of taking possession of the land which event shall take effect only after the date of notification. The date of notification is the fulcrum on which the lever of acquisition moves. Therefore any compensation, market value, additional compensation, solatium or interest payable shall always be dependent upon the date of notification or the date of award, as the case may be which will be after the date of notification. Therefore, the impugned judgment directing payment of interest from 10.8.1988 - a date far earlier than 26.8.1992, the date of notification u/s 4(1) is illegal. The claimant can get interest, at the maximum, only from 26.8.1992, the date of notification, which shall also be taken as in this case the date of taking possession of the land.

The Land Acquisition Act, 1894 provides for the procedure for acquisition and for award of compensation in respect of the land acquired including payment of interest on the award amount. As per the scheme of the Act, the acquisition shall commence based on a notification u/s 4(1). It is thereafter, the permission for entry into the land is given to the revenue officers and a declaration is to be made u/s 6 of the Act, notice u/s 9 is to be given to the parties, enquiry is to be conducted u/s 11 and award has to be passed u/s 12 fixing the land value. Thereafter, in terms of Section 16 possession shall be taken. At the same time, under certain emergency, the Collector is given power to take possession, as per Section 17, even without passing the award. It shall be after issuance of notice. Section 9 notice shall always be after issuance of notification u/s 4(1). Therefore, possession can be taken, always only after issuance of a notification u/s 4(1) of the Act. Possession, under the Act, cannot be taken on any date prior to the date of notification. It is in this perspective, that Section 34 or Section 28 envisaging payment of interest has to be examined. Section 34 of the Act provides for payment of interest by the Collector. Such interest shall "from the time of so taking possession". Such a situation arises when the amount of compensation is not paid or deposited on or before taking possession. Deposit or payment of amount arises only when the award is passed. It shall always be pursuant to and based on a notification. Taking possession arises either u/s 17 or u/s 16, as the case may be, only on a date after issuance of notification u/s 4(1). Therefore, the date of taking possession for calculating interest u/s 34 cannot be any date before the date of notification u/s 4(1) of the Act.

Section 28 enables the court to direct the Collector to pay interest. The said provision also provides for interest "from the date on which he took possession of the land". The taking of possession envisaged is either u/s 16 or Section 17 and as already mentioned above, which shall be pursuant to an acquisition proceedings commenced from the date of notification u/s 4(1). Therefore, possession made mention of in Section 28 shall also be the taking of possession after commencement of the acquisition proceedings. It shall, always, be later than the date of notification.

Thus, the Act does not contemplate a proceeding for land acquisition enabling the Collector or the Land Acquisition Officer to take possession of the land in question on a date earlier than the date of notification, on any count. Naturally, compensation, interest and other statutory benefits cannot be with reference to a date earlier than the date of notification u/s 4(1).

In this case, notification has been issued on 26.8.1992. The claimants had given possession of the land on 10.8.1998 or authorities had taken possession on the said date. It cannot be a possession taken under the Act. It shall be taken that possession in terms of the proceeding under the Land Acquisition Act has been passed over to the Government, at the earliest, on the date of notification. Naturally, interest accrues on the award amount only from 26.8.1992 and not from any date earlier than it.

Otherwise, another anomaly may arise. u/s 23(1) the market value of the land to be fixed based on the market value prevailing in the locality as on the date of notification, namely, 26.8.1992. Even the claimant submits that the land value had been at a steep increase during that period. So when the land value is to be fixed with reference to the date of notification i.e. 26.8.1992 interest cannot accrue on such amount from an earlier date; that too from 10.8.1998. Therefore there cannot be any justification in directing payment of interest either u/s 34 or u/s 28 from a date earlier than the date of the notification u/s 4(1) viz. 26.8.1992.

There is another aspect as well. The court did not award any amount in excess of the compensation fixed by the Collector. Court has power to direct payment of interest only u/s 28. Such a direction can be issued if any excess compensation is granted. In this case the court below did not grant any excess compensation. So there arise no situation for a direction by Court to pay interest.

We have taken note of the contention raised by the claimant that he had been dispossessed on 10.8.1988. He became unable to take the usufruct from the property and could not make use of the land for better purpose to earn income from that date. This is a matter for the claimant to agitate in a different proceeding. His dispossession on 10.8.1988 was not in terms of any proceeding under the Land Acquisition Act which commenced only from the date of notification u/s 4(1) viz., 26.8.1992. If he had been illegally dispossessed, he was not without any remedy. Interest on the compensation shall always be from any date later than the notification and not earlier than it.

Now we come to the cross-objection filed by the claimant. As already noticed above, no evidence was adduced by either parties in the reference court. Other properties were also acquired for the very same purpose under the same notification which gave rise to LAR No. 9 of 1994 and other connected cases. In that case, the reference court awarded Rs. 7,500/- per cent for the property acquired which was also in the very same locality, according to the claimant. The State filed an appeal against that award by the reference Court. That appeal has been dismissed by a Division Bench of this Court as per judgment in LAA 638 of 1996 confirming the award of the reference court fixing the land value at Rs. 7,500/- per cent. According to the cross appellant/Claimant both the properties are having same potentialities and are in the very same locality and were acquired for the very same purpose. Therefore, the cross-objection shall be allowed granting the same rate of the value.

As already noticed there was no piece of evidence before the court below in the case on hand. Even the claimant had not spoken to about the potentialities of his land. In such circumstances, sitting at this distance, we cannot hold, merely because a Division Bench has confirmed the award in respect of certain other land as mentioned above, that the land covered in the case on hand is of the same nature as that covered by the judgment of the Division Bench. It is matter for the claimant to prove or the State to rebut, as the case may be, in the reference court. We are therefore of the view that enabling both the parties to adduce evidence, the matter shall be remanded back to the reference court.

Accordingly, we set aside the judgment and remand the case for retrial with opportunity to both sides to adduce their evidence. The parties shall appear before the court below on 3.12.2001. The appeal and cross objection are allowed. The claimant will be entitled to refund of the court-fee paid on the cross objection.