Compensation payable from the moment land is deprived of possession: Supreme Court

The issue involved the clarity regarding the liability to pay interest and whether the liability commences from the date of acquiring possession of the land or only from the date of award in a land acquisition matter before the Supreme Court division bench consisting of Justice A.M. Khanwilkar and Justice CT Ravikumar in the matters between Gayabhai Digambar Puri (Died) Through LR v. The Executive Engineer and Ors. decided on 3.1.2022.

The facts of the case are The appellant claimed that when a person’s land was acquired, compensation should be paid to him immediately after he had been deprived of possession. In this case, the reference court ordered interest to be paid from April 1997 to March 1998, when the possession was taken. at a rate of 9 percent per annum for the first year and then at a rate of 15 percent per annum from April 1998 until the payment date in September 2004. Subsequently, the Bombay High Court overturned this decision of the Reference Court.

The judgement text does not mention any arguments or contentions by either the Petitioner or Respondent.

The apex court held that in RL Jain v. DDA case, it decided that the matter had been resolved, with its 2004 decision ruling that the person whose land was purchased would be entitled to interest from the day the land was acquired. In this case aforementioned, RL Jain v. DDA and Ex. (2004) 4 SCC 79 it was held that in a situation where the landlord’s dispossession fell before prior notice under section 4 of the Act, it was clear that the landlord could reclaim possession of his land by taking appropriate legal action. Thus, in the present case, the appellant would be entitled to interest from 4 April 1997, the date on which the land was deprived of ownership. According to the normal rule, if a person is deprived of his property due to land acquisition, he must be immediately compensated, and if the same is not paid to him immediately, he will be entitled to interest. compensation amount from the date of taking possession of the land to the date of payment.The appeal was partly allowed.

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Judgement reviewed by Bhaswati Goldar

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