Supreme Court of India
TAMIL NADU HOUSING BOARD versus ABDUL SALAM SARKAR (DEAD) AND OTHERS on 13 January 2021
[2021] 1 S.C.R.
TAMIL NADU HOUSING BOARD
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ABDUL SALAM SARKAR (DEAD) AND OTHERS(Civil Appeal No 94 of 2021)JANUARY 13, 2021
B[DR DHANANJAYA Y CHANDRACHUD ANDSANJIV KHANNA, JJ.]
Land Acquisition Act, 1894 – Acquisition of land – Intereston solatium – Entitlement to – Interpretation of Constitution Benchjudgment in Gurpreet Singh case – Direction of High Court to theeffect that claimants-respondents would be entitled to move anCapplication for interest on solatium in view of the judgment inGurpeet Singh Case– Held: Justified – On facts, claim for intereston solatium had not been rejected by the reference court – HighCourt had held that the issue as to whether interest on solatiumwould be granted would depend on the outcome of the proceedingspending before Supreme Court in Gurpreet Singh case – Liberty wasDthus granted by the High Court to institute proceedings before theSub Court after the matter was resolved in Gurpreet Singh case –Gurpreet Singh case mandates a test that interest on solatium wouldbe payable if the reference court has either not referred to it or hasnot rejected it expressly or by necessary implication, and the claimcan only be made in pending execution proceedings. – Hence, onEfacts, inter parties, respondents entitled to apply for grant of intereston solatium, though the earlier execution petition was closed sincetheir claim had not been rejected at any antecedent stage and hadbeen kept open – Reference court to verify the computations and topass appropriate orders – In terms of the judgment in Gurpreet Singhcase, interest on solatium payable w.e.f date of judgment in Sundervs Union of India (19 September 2001).F
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Disposing the appeal, the Court
HELD:1.1. Gurpreet Singh case mandates a test thatinterest on solatium would be payable if the reference court haseither not referred to it or has not rejected it expressly or bynecessary implication. Moreover the claim can only be made inGpending execution proceedings [Para 8][666-B-C]
1.2. In the present case, the claim for interest on solatiumhad not been rejected by the reference court. In appeal arisingfrom decision of reference court, the High Court observed thatsince the matter was pending before a larger bench of the SupremeCourt in Gurpreet Singh case, the issue as to whether interest on H
solatium would be granted would depend on the outcome of thoseproceedings and it would be open to the claimants to move anapplication before the Sub Court. The liberty which was grantedby the High Court to institute proceedings before the Sub Courtafter the matter was resolved by Supreme Court in Gurpreet Singhcase was the subject matter of a Special Leave Petition. Thejudgment of the High Court was affirmed by the dismissal of theSpecial Leave Petition. The review petition by the RevenueDivisional Officer was also dismissed. It was only after thejudgment of the Court in Gurpreet Singh, that the respondentsmoved an application for the grant of interest on solatium. Hence,inter parties, the claimants were entitled to apply for the grant ofinterest on solatium, particularly having regard to the fact thatthe claim had not been rejected at any antecedent stage and hadbeen kept open. As a matter of principle, no reason to take anyother view since it is in accord to the judgment in Gurpreet Singhcase. [Para 8 & 9][666-B-F; 666-G-H; 667-A]
2.1 The submission of the appellant is that the claim wasmade in 2008 after the earlier execution petition was closed andthe original award and enhanced compensation were depositedand appropriated by the claimant. The claim for interest onsolatium was not rejected and was expressly kept open bythe High Court in its judgment dated 12 July 2001. [Para 9][666-F-G]
2.2 The direction of the High Court to the effect that theclaimants-respondents would be entitled to the payment ofinterest on solatium is confirmed. Insofar as the exactmathematical computation is concerned, it would be appropriateto leave it to the reference court to verify the computations andto pass appropriate orders. It is clarified that in terms of thejudgment of the Constitution Bench in Gurpreet Singh case,interest on solatium will be payable with effect from the date ofthe judgment in Sunder vs Union of India (19 September 2001).[Para 10][667-B-D]
Gurpreet Singh v Union of India (2006) 8 SCC 457:[2006] 7 Suppl. SCR422 – followed.Sunder v Union of India (2001) 7 SCC 211: [2001] 3Suppl.SCR 176 –referred toCase Law Reference[2006] 7 Suppl. SCR 422followedPara 2[2001] 3 Suppl. SCR 176referred toPara 7
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ACIVIL APPELLATE JURISDICTION : Civil Appeal No. 94 of2021.
From the Judgment and Order dated 01.10.2018 of the High Courtof Judicature at Madras C.R.P. (NPD) No. 3909 of 2011.
C. Paramasivam, M. Yogesh Kanna, Raja Rajeshwaran S, AdityaBChadha, Advs. for the appellant.
K. Karunakaran, S. Gowthaman, Advs. for the respondents.
The Judgment of the Court was delivered by DR. DHANANJAYA Y CHANDRACHUD, J.C
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1. Leave granted.
2. The only question which arises in the present appeal is whetherthe respondents are entitled to interest on solatium for the acquisitionwhich took place under the provisions of the Land Acquisition Act 1894.DThis issue turns on an interpretation of the judgment of the ConstitutionBench of this Court in Gurpreet Singh vs Union of India[1] (“GurpreetSingh”).
3. By an order of this Court dated 1 December 2020, the issuewas crystallized by observing that the Court will “examine the questionEwhether (the) matter is covered by the judgment of this court in the caseof Gurpreet Singh”.
4. In the present case, the reference court by its decision dated26 July 1990, allowed for the grant of interest on solatium at the rate of12% per annum.
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5. When the matter was carried in appeal, a Division Bench ofthe Madras High Court by its judgment dated 12 July 2001, issued thefollowing clarification on the aspect of interest on solatium:
“It is further made clear that the claimants are not entitled tointerest on solatium and additional amount. Further, the issueGregarding grant of interest on solatium is pending before the LargerBench of the Hon’ble Supreme Court. Hence, depending on theoutcome of the cross before the Supreme Court, the claimantsare permitted to fill an appropriate petition before the concernedsub-court.”
H1(2006) 8 SCC 457
6. The Special Leave Petitions against the judgment of the DivisionBench were dismissed on 22 March 2004. The review petition filed bythe Revenue Divisional Officer was also dismissed on 2 August 2006. Itis in this background that we have to assess the tenability of the claimfor interest on solatium based on the decision of the Constitution Benchin Gurpreet Singh (supra).
7. In paragraph 54 of the judgment in Gurpreet Singh (supra),the above issue was considered specifically in the context of the earlierdecision in Sunder vs Union of India[2]. Dealing with the issue, JusticeP K Balasubramanyan speaking for the Constitution Bench observedthus:
“54….….That question is whether in the light of the decision inSunder (2001) 7 SCC 211 : 2001 Supp (3) SCR 176], the awardee/decree-holder would be entitled to claim interest on solatium inexecution though it is not specifically granted by the decree. It iswell settled that an execution court cannot go behind the decree.If, therefore, the claim for interest on solatium had beenmade and the same has been negatived either expressly orby necessary implication by the judgment or decree of theReference Court or of the appellate court, the executioncourt will have necessarily to reject the claim for intereston solatium based on Sunder [(2001) 7 SCC 211 : 2001 Supp(3) SCR 176] on the ground that the execution court cannotgo behind the decree. But if the award of the ReferenceCourt or that of the appellate court does not specificallyrefer to the question of interest on solatium or in caseswhere claim had not been made and rejected eitherexpressly or impliedly by the Reference Court or theappellate court, and merely interest on compensation isawarded, then it would be open to the execution court toapply the ratio of Sunder [(2001) 7 SCC 211 : 2001 Supp (3)SCR 176] and say that the compensation awarded includessolatium and in such an event interest on the amount couldbe directed to be deposited in execution. Otherwise, not.We also clarify that such interest on solatium can be claimedonly in pending executions and not in closed executionsand the execution court will be entitled to permit its A
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Arecovery from the date of the judgment in Sunder [(2001) 7SCC 211 : 2001 Supp (3) SCR 176] (19-9-2001) and not for anyprior period. We also clarify that this will not entail anyreappropriation or fresh appropriation by the decree- holder. Thiswe have indicated by way of clarification also in exercise of ourpower under Articles 141 and 142 of the Constitution of IndiaBwith a view to avoid multiplicity of litigation on thisquestion.”(emphasis supplied)
8. The test which Gurpreet Singh (supra) mandates is thatinterest on solatium would be payable if the reference court has eithernot referred to it or has not rejected it expressly or by necessaryCimplication. Moreover, the claim can only be made in pending executionproceedings. In the present case, the claim for interest on solatium hadnot been rejected by the reference court. In an appeal arising from thedecision of the reference court, the High Court, In its judgment dated 12July 2001, observed that since the matter was pending before a largerDbench of this Court, the issue as to whether interest on solatium wouldbe granted would depend on the outcome of those proceedings and itwould be open to the claimants to move an application before the SubCourt. It was after the judgment of this Court in Gurpreet Singh (supra),which was delivered on 19 October 2006, that the respondents movedan application for the grant of interest on solatium. The High Court by itsEimpugned judgment has come to the conclusion that such an applicationwas tenable in view of the judgment in Gurpreet Singh (supra). As amatter of principle, we see no reason to take any other view since it is inaccord to the judgment of the Constitution Bench.
9. The submission which has been urged on behalf of the appellantFis that in the present case, the claim was made in 2008 after the earlierexecution petition was closed and the original award and the enhancedcompensation were deposited and appropriated by the claimant. This, inour view, would not dis-entitle the claimant for the grant of interest onsolatium. The claim for interest on solatium was not rejected and wasGexpressly kept open by the High Court in its judgment dated 12 July2001. The liberty which was granted by the High Court to instituteproceedings before the Sub Court after the matter was resolved by thelarger bench of this Court was the subject matter of a Special LeavePetition. The judgment of the High Court was affirmed by the dismissalof the Special Leave Petition. The review petition by the RevenueH
Divisional Officer was also dismissed. Hence, inter partes, the claimantswere entitled to apply for the grant of interest on solatium, particularlyhaving regard to the fact that the claim had not been rejected at anyantecedent stage and had been kept open.
10. In the above view of the matter, we confirm the direction ofthe High Court to the effect that the claimants-respondents would beentitled to the payment of interest on solatium. However, insofar as theexact mathematical computation is concerned, it would be appropriateto leave it to the reference court to verify the computations and to passappropriate orders. Since during the pendency of these proceedings, adeposit has been made by the appellant in terms of the interim orders,the amount which has been deposited will be permitted to be withdrawnby the respondents and shall be given due credit for in arriving at thefinal amount which is due and payable. We also clarify that in terms ofthe judgment of the Constitution Bench in Gurpreet Singh (supra),interest on solatium will be payable with effect from the date of thejudgment in Sunder vs Union of India (19 September 2001).
11. The appeal is accordingly disposed of. The costs of Rs 5 lakhswhich have been deposited in this Court in pursuance of this Court’sorder, shall also be disbursed to the claimants.
12. Pending applications, if any, stand disposed of.
Bibhuti Bhushan Bose
Appeal disposed of.
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