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The Supreme Court has ruled that interest and solatium on land acquired under the NHAI Act cannot be restricted based on the financial burden of the acquiring authority. Interest must follow the Land Acquisition Act at nine per cent rather than the five per cent cap under the NHAI Act. The court rejected NHAI's plea to review an earlier ruling, despite the increase in projected liability. It also emphasized that finalized cases cannot be reopened, balancing the protection of landowners rights with legal certainty and closure in land acquisition disputes.
The Supreme Court has clarified that landowners whose property is acquired are entitled to statutory compensation, solatium, and interest under the Land Acquisition Act, and this entitlement cannot be influenced by the financial burden on the acquiring authority. The apex court specifically stated that interest must be calculated at nine per cent, as per the Land Acquisition Act, and not capped at five per cent under the National Highways Authority of India (NHAI) Act. Advertisement
This decision arose when NHAI requested a review of a previous order that had applied retrospectively to land acquired in 2019. The authority claimed that the financial liability had increased significantly from about INR 100 crore to nearly INR 29,000 crore due to the inclusion of solatium and interest. However, the Supreme Court rejected this argument, emphasizing that an increase in projected liability cannot alter the fundamental right of landowners to fair compensation.
The court also highlighted that while landowners are entitled to solatium and interest, they cannot reopen settled claims once legal proceedings have reached finality. This ensures a balance between upholding landowners rights and maintaining certainty in land acquisition cases. Additionally, the court clarified that cases acquired before March 2018 cannot be reopened for additional compensation, while claims pending at that time may pursue parity in benefits. This ruling reinforces the earlier 2019 judgment, which had mandated that provisions of the 1894 Land Acquisition Act apply to land acquired under the NHAI Act, ensuring equality and fairness under Article 14 of the Constitution.
The Supreme Court's decision reaffirms that land acquisition compensation is a constitutional right that cannot be limited or altered based on administrative or financial concerns. It also strengthens the principle that finalized claims must be respected to prevent endless litigation, ensuring both fairness for landowners and stability for public projects.
Source PTI
FAQ
Q1: What did the Supreme Court rule regarding interest on land acquisition compensation?
The Supreme Court ruled that landowners are entitled to statutory compensation, solatium, and interest under the Land Acquisition Act, and this entitlement cannot be influenced by the financial burden on the acquiring authority. Interest must be calculated at nine per cent, as mandated by the Act, and cannot be capped at five per cent under the NHAI Act.
Q2: Why did the Supreme Court hear this matter?
The National Highways Authority of India (NHAI) sought a review of a 2019 order that applied retrospectively to land acquired that year. NHAI argued that including solatium and interest increased its financial liability from around INR 100 crore to nearly INR 29,000 crore.
Q3: What was the court's response to NHAI's argument?
The Supreme Court rejected the claim, emphasizing that a rise in projected financial liability does not affect landowners constitutional right to fair compensation.
Q4: Can landowners reopen previously settled claims?
No. The court clarified that while landowners are entitled to solatium and interest, they cannot reopen claims that have already reached finality. This ensures a balance between fairness for landowners and certainty in land acquisition cases.
Q5: What about land acquired before March 2018?
Cases acquired before March 2018 cannot be reopened for additional compensation. However, claims pending at that time may seek parity in benefits.
Q6: How does this ruling relate to the 2019 judgment?
The decision reinforces the 2019 judgment, which applied provisions of the 1894 Land Acquisition Act to land acquired under the NHAI Act, ensuring equality, fairness, and protection of constitutional rights under Article 14.
Q7: Why is this ruling significant?
It confirms that land acquisition compensation is a constitutional right, not subject to administrative or financial limitations. It also prevents endless litigation by safeguarding finalized claims, balancing fairness for landowners with stability for public infrastructure projects.
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