All India Tea and Trading Co. Ltd. v. Sub-divisional Officer of Mangaldai
1961-06-20
G.MEHROTRA, S.K.DUTTA
body1961
DigiLaw.ai
MEHROTRA, J. : This rule arises out of an application under Article 226 of the Constitution of India. (2) The facts which are not disputed and which have led to the present petition are that the petitioner, who is the owner of a tea garden known as Singrimari Tea Estate, filed an application on the 21st June 1960 before the Sub-divisional Officer of Mangaldai, acting as the Collector, for payment of a sum of Rs. 6,255.67 Np. as interest payable to the petitioner on the amount of compensation. The land of the petitioner measuring 511 Bighas 2 Kathas 9 Lessas situate in village Kawadanga, Mouza Syamabari, District Dorrang, was requisitioned by the State Government under the provisions of the Assam Land (Requisition and Acquisition) Act, 1948, hereinafter called 'the Act' Since the date of requisition the land had been in possession of the State. By notification dated 7th January 1959 the aforesaid land was acquired by the State Government with effect from the 14th January, 1959 under the provisions of Sec. 4 (1) of the Act. Under the said Act the possession of the said land already being with the Government from the date of the requisition, the land vested absolutely with the Government on or from the 14th day of January 1959. By a fiction of law, therefore, the possession by the Government on acquisition will be deemed to have been taken from the 14th day of January, 1959. By an award dated the 26th November 1959 passed under Section 7 of the Act, the Subdivisional Officer, Mangaldai, awarded a sum of Rs. 76,723.50 N,p. as compensation for compulsory acquisition of the land. There is no dispute with regard to the amount of compensation awarded by the Land Acquisition Officer. No such objection was ever raised by the petitioner and consequently no reference was made to the Civil Court with regard to the amount which had been awarded by the Land Acquisition Officer. The petitioner's managing director was informed by a letter dated the 5th December, 1959, about the amount of compensation determined by the Land Acquisition Officer. The Collector, however, in spite of the determination of the amount of compensation by his award dated the 26th November, 1959, did not deposit the amount till the 25th of May, 1960.
The petitioner's managing director was informed by a letter dated the 5th December, 1959, about the amount of compensation determined by the Land Acquisition Officer. The Collector, however, in spite of the determination of the amount of compensation by his award dated the 26th November, 1959, did not deposit the amount till the 25th of May, 1960. On that date the Amount was withdrawn by the petitioner under protest, as alleged by him in paragraph 5 of his application. This fact has not been denied by the respondent. The petitioner claims interest from the 14th January 1959, the date on which he was dispossessed and the date on which the possession will be deemed to have been taken by the State Government, till the 25th May, 1960 when the petitioner actually received the amount. He has calculated the interest at the rate of six per cent per annum On that amount and has claimed Rs. 6,255.67 Np. This petition was rejected by the Subdivisional Officer, Mangaldai, on the 24th June, 1960, on the ground that there is no provision in the Act for payment of interest. The Subdivisional Officer further held that the acquisition of the land not being under the Land Acquisition Act, the provisions of Section 34 of the Land Acquisition Act were not attracted. Thereafter notices Were sent by the petitioner to the Chief Secretary to the Government of Assam, Shillong, and the Secretary in the Revenue Department, Government of Assam, Shillong, on the 30th July, 1960, to the effect that the provisions of Sec. 7 (2) of the Act as amended excluding the operation of Sec. 23 (2) of the Land Acquisition Act, 1894 in the award are repugnant and void. We are, however, not concerned with that part of the case. The petitioner was, however, not paid any interest for the period mentioned above. By means of this petition, the petitioner has claimed interest on the amount of compensation determined by the award from the 14th January, 1959 till the 25th May, 1960, the date on which he received the amount of compensation. (3) 'The contention raised by the respondent is that as there is no express provision in the Act for payment of interest, the petitioner was not entitled to any interest on the amount of compensation.
(3) 'The contention raised by the respondent is that as there is no express provision in the Act for payment of interest, the petitioner was not entitled to any interest on the amount of compensation. The contention of the petitioner is that the provisions of Sections 28 and 34 of the Land Acquisition Act apply to the proceedings for acquisition under the Act. Reliance is placed on SUD" section (3) of Section 4 of the Act which reads as follows: "On such vesting the State Government shall be empowered to apply to such land any of the provisions of the Land Acquisition Act, 1894 (Act I of 1894), with the rules framed thereunder." It is difficult to accept the contention of the petitioner that by virtue of this section, the provisions of Sec. 34 of the Land Acquisition Act in terms are applied to the entire proceedings of acquisition. What the section means is that after the land is vested in the State Government, the State Government shall apply the provisions of the Land Acquisition Act to the land which has been taken possession of by the State Government in so far as they can be made applicable. This sub-sec. (3) of Section 4 of the Act, to our mind, does not deal with the question of payment of interest on the amount of compensation. Compensation has to be determined in accordance with the provisions of Section 7 of the Act and the provisions of the Land Acquisition Act have been made applicable to1 the reference made by the Collector under Sec. 8 (b) of the Act. Apart, however, from the terms of Section 34 of the Land Acquisition Act, when a person is deprived of his possession over the land, he is entitled under the general law to get interest on account of the fact that he has been deprived of the possession and he has got a right to remain in possession over the property. In a recent decision their Lordships of the Supreme Court have laid down the principles on which interest is payable to a person when his land, has been acquired and when the compensation is not paid to him in due time. Reference may be made in this connection to the case of Satinder Singh v. Umrao Singh, reported in AIR 1961 SC, 908.
Reference may be made in this connection to the case of Satinder Singh v. Umrao Singh, reported in AIR 1961 SC, 908. The matter no doubt came before their Lordships of the Supreme Court in an appeal from a decision of the High Court in an appeal on a reference under the East Punjab Land Acquisition and Requisition Act. But, the principle which has been laid down in this case is apposite and it will be better to refer to the set principle as laid down by their Lordships of the Supreme Court. At page 916 of the report it is observed as follows:- "It would thus be noticed that the claim for interest proceeds on the assumption that when the own r of immovable property loses possession of it he is entitled to claim interest in place of right to retain possession. The question which We have to consider is whether the application of this rule is intended to be excluded by the Act of 1948, and as We have already observed, the mere fact that Sec. 5 (3) of the Act makes See. 23 (1) of the Land Acquisition Act of 1894 applicable we cannot reasonably infer that the Act intends to exclude the application of this general rule in the matter °f the payment of interest............" The argument which was advanced in that case and which has been advanced in the present case also is that as the provisions of Section 23 (1) of the Land Acquisition Act have been expressly made applicable to the acquisition under the Act, all other provisions of the Land Acquisition Act by necessary implication have been excluded. This argument precisely was repelled by their Lordships of the Supreme Court. Having rejected the argument of the State Counsel that the express reference to Section 23 of the Land Acquisition Act does not necessarily by implication exclude the application of the other provisions of the Land Acquisition Act, their Lord-ships have gone farther and have laid down the principles under which the interest should be paid to the applicant whose land has been acquired. The principle enunciated, as We have already indicated above, is that anyone who has been deprived of his possession is entitled to claim interest in place of his right to retain possession. This right has not been excluded by implication under the present Act. (4) Mr.
The principle enunciated, as We have already indicated above, is that anyone who has been deprived of his possession is entitled to claim interest in place of his right to retain possession. This right has not been excluded by implication under the present Act. (4) Mr. Pathak appearing for the respondent lias canvassed three paints. He has firstly contended that in the land acquisition cases generally the award is given before the possession is actually taken and thus there is no occasion for the person to ask for the inclusion of interest after dispossession in the award itself. In the present case, the amount itself was determined after the possession had been taken. It was, therefore, open to the petitioner to object to the award at that stage and he should have asked for the inclusion of the amount of interest in the award which was given, after the possession had actually been taken. This argument is based on the assumption that the word 'compensation under the Act should be given a different meaning from the one which is given to it under the Land Acquisition Act. The award only relates to the compensation to which the petitioner is entitled. Section 7(2) of the Act has expressly laid down that in determining the compensation the principles of Section 23 (1) of the Land Acquisition Act will apply. Section 23(1) of the Land Acquisition Act only lays down that the compensation will be the market value of the land on the date of the notification. The word 'compensation' therefore, in our opinion, cannot include the amount of interest which the petitioner may be otherwise entitled to as a right on the amount of compensation. Moreover, the right of the petitioner to' get interest is on the amount of compensation and thus the amount of interest cannot be included in the word 'compensation' itself. (5) The other argument is that having accepted the amount of compensation determined in the award, it is not open now to the petitioner to ask for interest for the period from the date of possession till the date of the award itself. We do not think there is any principle of law on which the petitioner can be debarred from claming interest for that period- The question of estoppel will not arise at all in this case.
We do not think there is any principle of law on which the petitioner can be debarred from claming interest for that period- The question of estoppel will not arise at all in this case. If the amount) of interest cannot be regarded as compensation then there was no question of including that amount in the award itself, and thus any acceptance of the amount determined by the Land Acquisition Officer cannot act as an estoppel against the right which accrues to the petitioner after the award itself has been given as also against the right to claim interest on the amount of compensation awarded. 1(6) The next argument is that the cases of Land Acquisition Act stand on a different footing. Section 34 of the Land Acquisition Act is based On the principle that if the amount is not deposited after the award has been given, then the Collector cannot claim the benefit of possession as well as the amount of compensation which has beg, determined; but, in the present case, he could not deposit the amount unless an award was given and the actual amount had been determined. There is no question in such cases of the petitioner not getting interest on account of the default committed by the Collector. The argument, on the face of it, appears attractive; but, in our opinion, it has got no substance- The principle on which the petitioner's right to claim interest is based has been very clearly laid down by their Lordships of the Supreme Court an<j it is not on account of the default by the Collector in paying the price, but it is in lieu of the right which the petitioner has to retain possession over the property. When the amount of compensation has been determined, the Government will be liable to pay interest on that amount as the petitioner has been deprived of the possession of his property. Till he actually got the price he was entitled to retain possession over the property. (7) It is then lastly contended that in a petition under Article 226 of the Constitution, no such relief can be granted to the petitioner. The petitioner's remedy, if at all, was to ask for a reference challenging the award, and secondly, if there was any remedy open to the petitioner it was to tile a regular suit.
(7) It is then lastly contended that in a petition under Article 226 of the Constitution, no such relief can be granted to the petitioner. The petitioner's remedy, if at all, was to ask for a reference challenging the award, and secondly, if there was any remedy open to the petitioner it was to tile a regular suit. We do not think there is any substance in this contention either. The Collector has rejected the prayer of the petitioner to pay the interest on the ground that there is no express provision in the Act itself which provides for payment of interest. That, in our opinion, is an erroneous view of the Act which has been taken by the Collector. That being so, a mandamus can be issued to the Collector to consider the application of the petitioner for payment of interest in the light of the observations which we have already made, namely, that the petitioner has got the right to get interest on the amount of compensation from the date «f his dispossession till the date of payment of the compensation money. (8) The contention raised by the petitioner is that we should direct the Collector to pay interest at the rate of six per cent per annum. As we have already said, the petitioner is entitled to interest because he has been deprived of his possession. Section 34 of the Land Acquisition Act in terms does not apply. It m3y be that the Legislature after considering the whole matter has fixed the rate of six per cent per annum as the value of the loss suffered by the petitioner on account of his dispossession, but it cannot be said that Section 34 in terms is attracted and that the Collector is bound to pay interest at that rate. Ordinarily, petitioner may be entitled to interest at the rate of six per cent per annum. The contention of the petitioner is that if no such direction is given in this order, the Collector may arbitrarily fix the rate of interest. We see no reason that the Collector will act in such an arbitrary manner. The Collector has rejected the prayer of the petitioner on the ground that he is not entitled to any interest.
The contention of the petitioner is that if no such direction is given in this order, the Collector may arbitrarily fix the rate of interest. We see no reason that the Collector will act in such an arbitrary manner. The Collector has rejected the prayer of the petitioner on the ground that he is not entitled to any interest. (9) We accordingly cancel the order passed by the Collector and issue mandamus to the Collector directing him to consider the application of the petitioner for payment of interest and grant him interest in the light of the observations made by us. The rule is made absolute with costs, which we assess at Rs. 100/-. (10) S. K. DUTTA, J. : I agree. IE/M.F. Petition allowed.