In a significant legal case, the Supreme Court of India has provided a judgement on the interpretation of Section 30 of the Land Acquisition Act. The case involved a dispute related to the calculation of solatium in the acquisition of lands for the construction of Metro railway. The key question revolved around whether solatium should be calculated solely based on the market value and assets, or include the additional 12% per annum on the market value as well. This judgement has far-reaching implications in the realm of land acquisition laws in India.
Facts
- The High Court partly allowed the revision application filed by the petitioner.
- The High Court directed to calculate solatium only on the market value of the acquired land and assets, excluding the additional 12% per annum.
- The High Court ordered a reassessment of the total amount payable to the petitioner.
- The original owner, the petitioner, felt aggrieved by the High Court’s decision and filed Special Leave Petitions.
- By an order dated 28.02.2018, the Appellate Authority enhanced the compensation amount for the petitioner.
- The enhanced amount includes Rs.6,20,52,215/- for market value of the land and Rs.6,75,526/- for the value of the structure.
- The petitioner is entitled to a further sum at the rate of 12% per annum on the market value as per Section 30(3) of the 2013 Act.
- The total compensation due to the petitioner is calculated as Rs.9,94,18,980/- inclusive of market value, value of structure, and additional sum at the specified interest rate.
- The petitioner is also entitled to solatium at a rate of 100% on the total compensation amount.
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Issue
- The short question posed for consideration in this case is whether the solatium under Section 30(1) of the 2013 Act should be calculated on the market value and assets alone, or should it include the additional 12% per annum on the market value as well.
- The lands owned by the petitioner were acquired for the construction of Metro railway, leading to the dispute.
- The main issue revolves around the interpretation of Section 30 of the 2013 Act in relation to the calculation of solatium.
- The key argument is whether the solatium amount should be based solely on the market value and assets, or if the 12% per annum on the market value as specified in Section 30(3) should also be included in the calculation.
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Arguments
- Section 26 of the Act defines the manner in which the market value is determined by the Collector.
- Section 27 determines the compensation paid to the land owner by including all assets attached to the land.
- Compensation under the Act includes any amount statutorily due to the land owner.
- Section 28 provides parameters for determining the compensation for acquired land.
- Sub-section (3) of Section 30 of the 2013 Act mandates the Collector to award 12% per annum in addition to the market value.
- The petitioner argues that the solatium under Section 30(1) should be calculated on the total compensation amount, including the 12% per annum additional sum.
- The sum payable at 12% per annum is considered as another form of compensation for compulsory acquisition.
- A liberal interpretation of the 2013 Act is advocated in favor of land owners affected by compulsory acquisition.
- The learned Senior Advocate representing the petitioner argued that Section 69(3) of the Act indicates that solatium should be 100% over the total compensation amount.
- It is suggested that a beneficial interpretation of Section 69(3) is that solatium under Section 30(1) should be the sum of 100% of the market value determined under Section 26, the asset value determined under Section 27, and 12% of the market value determined under Section 30(3) of the 2013 Act.
- Any interpretation contrary to the above would go against the legislative intent as per the Statement of Objects and Reasons of the 2013 Act.
- The petitioner requests that the Special Leave Petitions be allowed based on these arguments.
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Analysis
- The final award declared by the Collector shall be in three parts/components: amount of compensation, solatium amount equivalent to 100% of the compensation amount, and amount calculated at 12% per annum on the market value.
- Solatium amount determined under sub-section (1) of Section 30 of the 2013 Act shall be equivalent to 100% of the market value plus the value of assets attached to the land.
- The total compensation includes the market value of the land and the value of assets attached to the land.
- The solatium payable is different in the 2013 Act compared to the old Land Acquisition Act.
- Before passing the final award, the Collector determines the market value of the land, followed by determining the compensation as per Section 27 of the Act which includes the market value and the value of all assets attached to the land.
- The determination of the value of things attached to the land or building is as per Section 29 of the 2013 Act.
- Section 30 of the Act stipulates the calculation of compensation for land acquisition.
- The Collector is required to award the market value of the land, with an additional 12% per annum rate calculated from the date of notification to the date of award or possession.
- An amount equivalent to 100% of the compensation is to be imposed as Solatium to finalize the award.
- Section 69 of the 2013 Act determines the final award which includes compensation, additional amount calculated at 12% per annum, and solatium at 100% over the total compensation.
- The amount of compensation is a part of the final award, distinct from the total award amount.
- Solatium as per sub-section (1) of Section 30 is calculated only on the market value and assets attached to the land, excluding the additional amount at 12% per annum on such market value.
- Interpreting solatium differently would go against the scheme of the 2013 Act.
Decision
- The total amount of compensation payable is determined as per Sections 26 to 29 of the 2013 Act.
- The High Court’s view on the compensation is agreed upon.
- Both Special Leave Petitions are dismissed.
Case Title: RB DEALERS PRIVATE LIMITED Vs. THE METRO RAILWAY(SERVICE THROUGH THE GENERAL MANAGER)
Case Number: SLP(C) No.-014078 / 2019
