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The Supreme Court has dismissed a review petition by the National Highways Authority of India (NHAI), confirming that landowners whose land was acquired for highway projects between 1997 and 2008 are entitled to extra compensation, including solatium and interest. The court ruled that the projected financial burden of around INR29,000 crore cannot justify denying statutory rights. It also set a cut off date of March 28, 2008, limiting claims to unsettled cases. Compensation already paid cannot be recovered. The ruling strengthens landowners rights while maintaining legal certainty.
The Supreme Court has rejected a review petition filed by the National Highways Authority of India (NHAI), leaving the authority with an estimated INR29,000 crore liability for unsettled land acquisition cases. The bench, led by Chief Justice of India Surya Kant and Justice Ujjal Bhuyan, reaffirmed that landowners whose property was acquired for highway projects between 1997 and 2008 are entitled to extra compensation in the form of solatium and interest, even for past acquisitions. Advertisement
NHAI had sought to limit the retrospective effect of the 2019 judgment, arguing that applying it to older acquisitions would impose a massive financial burden. The apex court dismissed this, stating that financial implications cannot override the constitutional guarantee of just compensation. The court emphasized that projecting costs does not provide a valid reason for review and that the grant of solatium and interest cannot depend on the magnitude of financial liability.
To regulate claims, the Supreme Court set a cut off date of March 28, 2008. Only landowners with pending cases on or after this date are eligible for additional compensation. Cases fully settled before the cut off cannot be reopened. The court clarified that NHAI is not entitled to recover any solatium or interest already paid, preserving the rights of landowners who had received compensation.
This ruling draws on a landmark 2008 judgment by the Punjab and Haryana High Court in the Golden Iron and Steel case, which recognized that denying solatium and interest under The National Highways Act violated the principle of equality. Prior to this, landowners affected by highway projects lacked a strong legal basis to demand these benefits, unlike those covered by general land acquisition laws.
The background of this issue traces to a 1997 amendment to The National Highways Act, which sped up highway land acquisition but removed solatium and interest. These benefits, which compensate landowners for the compulsory nature of acquisition and delayed payments, were restored by law through the 2013 Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, extended to highways in 2015. From January 1, 2015, highway land acquisitions began to include these statutory benefits.
The dispute highlights the long-standing imbalance between fast-tracked infrastructure development and landowners rights. By rejecting NHAI's review, the Supreme Court has reinforced the principle that constitutional protections for fair compensation cannot be compromised, while also ensuring legal clarity by limiting claims to unresolved cases.
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