Person Deprived Of Possession Of His Property On Account Of Acquisition Of Land Should Be Paid Compensation Immediately: Supreme Court

The Supreme Court observed that if a person is deprived of possession of his property on account of acquisition of land, he should be paid compensation immediately.

If the same is not paid to him forthwith, he would be entitled to interest on the compensation amount from the date of taking possession of the land till the date of payment, the court said.

In this case, the issue was regarding the liability to pay interest whether commences from the date of taking possession or only from the date of award. The Reference Court had directed that the interest has to be paid from 04.04.1997 when possession was taken until 03.04.1998 for the first year at the rate of 9 per cent per annum and thereafter at the rate of 15 per cent per annum from 04.04.1998 till the date of payment, i.e. 08.09.2004. This was altered by the High Court.

While restoring this direction issued by the Reference Court, the bench comprising Justices AM Khanwilkar and CT Ravikumar said:

"It is well-settled that the normal rule is that if on account of acquisition of land a person is deprived of possession of his property, he should be 3 paid compensation immediately and if the same is not paid to him forthwith, he would be entitled to interest on the compensation amount from the date of taking possession of the land till the date of payment thereof as expounded in R.L. Jain (D) by Lrs. Vs. D.D.A. & Ors. reported in (2004) 4 SCC 79 (in particular paragraph 17.1)."

The court held that the appellant would be entitled for interest on or from date when the possession of the land was taken i.e. 04.04.1997 at the rate specified by the Reference Court.

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