Thankamany vs Kerala State

Balanarayana Marar, J.—The main question that arises for consideration in these appeals is whether the provision for higher solatium under the amended Land Acquisition Act applies to an award made subsequent to 24th of September 1984 even though the acquisition commenced prior to the said date. The appeals also raise Anr. question regarding the applicability of Section 23(1-A) providing additional amount of compensation to awards made in such acquisition proceedings. The facts in brief may be stated as follows:

By notification, dated 11th July 1978 an area of 5.75 ares of land in Sy. No. 368/18-B2 of Aryad South Village was acquired for the Alleppey Town By-pass of National Highway 47. The award was passed on 28th November 1979. The land acquisition officer fixed land value at Rs. 1,543 per are. Dissatisfied with the award claimants sought reference to the court below. In the claim statement filed by the 3rd claimant it was contended that the acquired land is situated in an important locality where it would fetch at least Rs. 1,800 per cent. The other claimants adopted the contentions raised by the 3rd claimant. The commissioner appointed by the court below submitted a report and mahazar. On a consideration of the documents and evidence the court below determined land value at Rs. 2,964 per are. Apart from the compensation so determined the claimants were also found entitled to 30 per cent solatium on the market value of the land. Interest at 12 per cent of such value was also awarded u/s 23(1-A) of the Land Acquisition Act apart from interest at 9 per cent from the date of taking possession for a period of one year and thereafter at 15 per cent. Aggrieved by that award claimants filed L.A.A. 147/1989. The other appeal is filed by the State.

It is urged by the learned Government Pleader that Respondents are not entitled to get solatium at 30 per cent and the enhanced rate of interest provided in the amended Section 28 of the Act. Apart from enhanced compensation of land value and value of improvements the court below has granted three more reliefs: (1) solatium at 30 per cent of the market value of the land, (2) interest at the rate of 9 per cent for the first year from the date of taking possession and 15 per cent thereafter, and (3) interest at 12 per cent on such market value for the period from the date of publication of notification till the date of the award of the Collector. The award was passed on 28th November 1979 and Section 30(2) of the Amendment Act is ruled out according to learned Government Pleader. For that reason it is contended that Section 23(2) as amended in 1984 is inapplicable. On the other hand learned Counsel for Respondents-claimants would contend that in all awards passed after the commencement of the Amended Act the enhanced solatium and all other benefits provided for in the amended Act are payable.

In order to appreciate the contentions raised by both sides it is appropriate to refer to Section 30(2) of the Amendment Act which comes under the head "transitional provisions". Section 30(2) reads:

The provisions of Sub-section (2) of Section 23 and Section 28 of the principal Act, as amended by Clause (b) of Section 15 and Section 18 of this Act respectively, shall apply, and shall be deemed to have applied, also to, and in relation to, any award made by the Collector or Court or to any order passed by the High Court or Supreme Court in appeal against any such award under the provisions of the principal Act after the 30th day of April 1982 [the date of introduction of the Land Acquisition (Amendment) Bill, 1982, in the House of the People] and before the commencement of this Act.

The intention of the Parliament is to benefit persons in whose favour awards were passed after the publication of the Bill and before the enforcement of the Act. Those persons should also get the benefits conferred by the Amended Act. The amended Sub-section (2) of Section 23 and Section 28 of the Act shall apply and shall be deemed to have applied to any award made by the Collector or the Court between 30th April 1982, the date of introduction of the Bill in the House of the People, and 24th September 1984, the date of commencement of the Act. If persons in whose favour awards were passed within those prescribed dates were entitled to enhanced solatium and other benefits, one fails to understand why those benefits are denied to a person in whose favour an award was passed after the commencement of the Act. It necessarily follows that the benefits are available to persons in whose favour awards were passed after 24th September 1984. The specific provision incorporated in the transitional provisions of Section 36(2) of the Amendment Act is only to clarify that the amended provisions will be applicable even to awards passed between the interregnum and orders passed by the High Court and Supreme Court between those dates. In those cases the awards would have been passed only in accordance with the unamended provisions of the Act and that necessitated the introduction of the deeming provisions in Section 30(2) of the Amendment Act.

Learned Government Pleader relying on the decision of the Supreme Court in Union of India (UOI) and Another Vs. Raghubir Singh (Dead) by Lrs. Etc., asserts that the benefits of the enhanced solatium and interest are confined to an award passed between the specified dates. In that decision the Supreme Court was considering die meaning of the words "or to any order passed by the High Court or Supreme Court on appeal against any such award" contained in Section 30(2) of the Amendment Act. The Supreme Court posed the question as to whether the deeming provision contained in that sub-section is limited to appeals against an award of the Collector or the Court made between 30th April 1982 and 24th September 1984 or whether it includes appeals disposed of between 30th April 1982 and 24th September 1984 even though arising out of awards of the Collector or of the Court made before 30th April 1982. The Supreme Court answered that the section must necessarily intend that the appeal to the High Court or the Supreme Court in which the benefit of the enhanced solatium is to be given must be confined to an appeal against an award of the Collector or of the Court rendered between 30th April 1982 and 24th September 1984. The Supreme Court observed that the words "any such award" are intended to have deeper significance and in the context in which those words appear in Section 30(2), it is clear that they are intended to refer to awards made by the Collector or Court between 30th April 1982 and 24th September 1984. In other words Section 30(2) of the Amendment Act extends the benefits of enhanced solatium to cases where the award by the Collector or by the Court is made between 30th April 1982 and 24th September 1984 or to appeals against such awards decided by the High Court and the Supreme Court whether the decisions of the High Court or the Supreme Court are rendered before 24th September 1984 or after that date. The Supreme Court held that all that is material is that the award by the Collector or by the Court should have been made between 30th April 1982 and 24th September 1984. The Supreme Court found substance in the contention of the learned Attorney General that if Parliament had intended that the benefit of enhanced solatium should be extended to all pending proceedings, it would have said so in clear language. On the other hand the terms in which Section 30(2) is couched indicate a limited extension of the benefit. It is further held that the Amendment Act has not been made generally retrospective with effect from any particular date and such retro-spectivity as appears is restricted to certain areas covered by the Parent Act and must be discovered from the specific terms of the provision concerned.

Relying on these observations learned Government Pleader would contend that the award having been passed after 24th September 1984, the enhanced solatium and interest awarded under the Amended Act cannot be claimed by Respondents. But the intention of the Parliament in enacting Section 30(2) has been found by the Supreme Court to be to confer the benefits to an award passed by the Collector or the Court between the aforesaid two dates or to an appellate order of the High Court or the Supreme Court which arises out of an award of the Collector or the Court made between the said two dates. The Supreme Court has observed that if the proceeding has terminated with the award of the Collector or of the Court made between the aforesaid two dates, the benefit of Section 30(2) should be applied to such award made between the aforesaid two dates. If the proceeding has passed to the state of appeal before the High Court or the Supreme Court it is at that stage that all benefit of Section 30(2) will be applied. But in every case the award of the Collector or the Court must be made between 30th April 1982 and 24th September 1984. Relying on this decision it is argued by learned Government Pleader that Section 23(2) has no retrospective operation and the applicability of that section as amended by the Amendment Act is confined to a limited class of cases, namely, awards passed between the specified dates and appeals pending before the High Court and the Supreme Court against awards passed between those dates.

The acceptance of this contention will amount to denial of the benefits to a person in whose favour an award was passed after 24th September 1984 even though the proceeding commenced earlier. The Supreme Court having noticed this anomaly removed the anomaly by rendering the decision in Union of India and Others Vs. Filip Tiago De Gama of Vedem Vasco De Gama, . In that case the notification was issued on 23rd February 1968 and award was passed on 5th March 1969. On a reference u/s 18 of the Act the court awarded enhanced compensation by order dated 28th May 1985. Solatium at 30 per cent was also granted. The Union of India contended before the Supreme Court that solatium at 30 per cent is not payable, the award having been passed after the commencement of the Act. Noticing the provision contained in Section 30(2) of the Amendment Act the Supreme Court observed that the purpose of the provisions seems to be that the award made in the interregnum must get higher solatium inasmuch as to awards made subsequent to September 24, 1984. It is observed that perhaps it was thought that awards made after the commencement of the Amending Act 68/1984 would be taken care of by the amended Section 23(2). The Supreme Court has noticed that the case like the present one seems to have escaped attention by innocent lack of due care in the drafting and the result would be an obvious anomaly. If there is obvious anomaly in the application of law, the court could shape the law to remove the anomaly.

In paragraph 18 of the decision the Supreme Court has given examples of two acquisition proceedings of two adjacent pieces of land for the same public purpose. In one the award of the Collector is made on 23rd September 1984 and in the other on 25th September 1984. The benefit of higher solatium is available in the case of the first award and not to the second. This, according to the Supreme Court, is intrinsic illogicality if the award made after September 24, 1984 is not given higher solatium. The Supreme Court held that such a construction of Section 30(2) would be vulnerable to attack under Article 14 of the Constitution and it should be avoided. It was held that the benefit of higher solatium u/s 23(2) should be available also to the present case. This according to the Supreme Court would be the only reasonable view to be taken in the circumstances of the case and in the light of the purpose of Section 30(2). In that view of the matter the higher solatium allowed by the High Court was kept undisturbed.

In arriving at this decision the Supreme Court has referred to the decision in Union of India (UOI) and Another Vs. Raghubir Singh (Dead) by Lrs. Etc., and two earlier decisions referred therein. But those decisions do not solve the problem presented in that case. The obvious anomaly noticed by the Supreme Court was removed by holding that the enhanced solatium is payable even in cases of awards passed after 24th September 1984.

Regarding the entitlement of additional amount provided u/s 23(1-A) it is urged by learned Government Pleader that the transitional provisions in Section 30(1) of the Act can be applied only in relation to any proceeding for the acquisition of land pending on 30th April 1982 in which no award has been made by the Collector before that date and to every proceeding for the acquisition of any land under the principal Act commenced after that date whether or not an award has been made by the Collector before the date of commencement of this Act. The Supreme Court while interpreting this provision held in Union of India and Others Vs. Filip Tiago De Gama of Vedem Vasco De Gama, thus:

Entitlement of additional amount provided u/s 23(1-A) depends on pendency of acquisition proceedings as on April 30, 1982 or commencement of acquisition proceedings after that date.

It was observed that Section 30(1) refers to award of Collector and does not refer to Court award which is used only in Section 30(2). In that case there was no proceeding pending before the Collector as on 30th April 1982. It was therefore held that Section 30(1)(a) was not attracted. Since the proceedings for acquisition commenced before 30th April 1982, Section 30(1)(b) is also not applicable. The claimant was therefore not entitled to additional amount provided u/s 23(1-A) of the Land Acquisition Act.

In order to get the benefits conferred u/s 30(1) of the Land Acquisition (Amendment) Act, 1984 the proceeding for acquisition must either be pending on 30th April 1982 or the proceeding must have commenced after that date whether or not an award has been made by the Collector before the date of commencement of the Amendment Act.

In the case on hand the reference was pending on the date of commencement of the Act and was answered only since then. The law laid down by the Supreme Court in Union of India and Others Vs. Filip Tiago De Gama of Vedem Vasco De Gama, applies and it has to be held that Respondents are entitled to get enhanced solatium as well as the enhanced rate of interesest provided in Section 28 of the Act. Since the proceeding for acquisition was not pending on the date of commencement of the Act, the benefit conferred under Sections 23(1-A) has to be denied to the claimants.

Now regarding the enhanced compensation awarded by the court below; the land acquisition officer assessed the land value at Rs. 1,543 per are which works out to Rs. 620 per cent. Against a claim of Rs. 1,800 per cent the court below awarded Rs. 1,200. This according to the claimants is very low considering the importance of the locality and the potential value of the land. On the other hand it is the contention of the Government Pleader that the market value determined by the court is far in excess of the real market value. The commissioner who inspected the property has pointed out that the acquired land has got 20 meters of road frontage. The By-pass starts from the acquired land. It is also reported by the Commissioner that the acquired land is suitable for putting up residential buildings as well as shop rooms. The land is located about 75 meters from Kommadi Junction where the National Highway join the road leading to the District Court. About 50 meters away on the southern side lies a church. There are other institutions also in the vicinity. From the Commissioner''s report it would appear that the acquired land is situated in an important locality in Alleppey Town. In view of the unique position of the land as pointed out by the commissioner, the land value determined by the court below is low according to learned Counsel. Reliance was also placed on Ext. A-1 assignment, dated 25th March 1976. The document was proved by P.W. 2 who purchased 21.25 cents of land for a consideration of Rs. 35,000. It is pointed out that P.W. 2 was not cross-examined by the Government Pleader and his evidence stands uncontroverted. The court below refused to place reliance on Ext. A-1 since the document was not relied on by the court in other cases. Copies of the judgments in those cases were not exhibited and the particulars of the proceedings do not find a place in the impugned judgment. The fact that Ext. A-1 was not relied on in Anr. case is no reason to discard that document when it was executed before the date of acquisition and the payment of consideration has been proved by the purchaser. The court below was therefore wrong in not placing any reliance on Ext. A-1 and the testimony of P.W. 2. The Commissioner''s report and mahazar were available before the court which throw considerable light on the importance of the area where the land is located and the facilities available. The learned Subordinate Judge has not cared to look into these aspects. At the same time the court has noticed the fact that the land lies by the side of the National Highway with a considerable road frontage surrounded by public establishments and the business centre. The court has also noticed the fact that the land is an ideal place for business as well as residential purposes. In those circumstances the court should have looked into the rate at which the property was sold under Ext. A-1. Under that document the property was sold at the rate of Rs. 1666 per cent. Taking into account the importance of the locality and other factors reported by the Commissioner, the compensation claimed by the claimants at the rate of Rs. 1,800 per cent appears to be reasonable. Differing from the court below it is found that Appellants in L.A.A. 147/1989 are entitled to get land value at the rate of Rs. 1,800 per cent, which will work out to Rs. 4,446 per are. Land value will be calculated at this rate for 5.75 ares are paid to the claimants less the amount already paid.

Regarding the benefits under the Amended Act, the claimants are entitled to get solatium at 30 per cent and interest at 9 per cent for one year from 27th December 1979, the date on which possession was taken and thereafter at 15 per cent. The claim for interest u/s 23(1-A) of the Act is denied.

In the result both the appeals and the cross-objection in L.A.A. 147 of 1989 are allowed in part and the judgment and decree of the court below are modified to the extent indicated above. The parties shall suffer their costs in the appeals.