Union of India and Another v. Tarsem Singh and Others
"Denying solatium and interest to owners whose land was acquired under the National Highways Act, while owners whose land was acquired for other public purposes received them, is a classification with no rational nexus to the object of speedy acquisition; Section 3J is void under Article 14 to that extent."
Issues Before the Court
- (i)
Whether Section 3J of the National Highways Act, 1956, which excluded the Land Acquisition Act, 1894 from acquisitions under the Act and so denied landowners solatium and interest, violates Article 14?
- (ii)
Whether landowners whose land was acquired for national highways between 1997 and 2015 are entitled to solatium and interest on their compensation?
Law & Rules Applicable
- (i)
National Highways Act, 1956, Sections 3A to 3J (inserted by the National Highways Laws (Amendment) Act, 1997), including Section 3G (determination of compensation) and Section 3J (Land Acquisition Act not to apply).
- (ii)
Land Acquisition Act, 1894, Section 23(1A) and (2) (additional amount and solatium) and Section 28 (interest on excess compensation).
- (iii)
Constitution of India, Article 14; and the notification of 28 August 2015 applying the compensation provisions of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 to acquisitions under the National Highways Act from 1 January 2015.
Application to Facts & Circumstances
Under the 1997 amendments to the National Highways Act, land for national highways was acquired by a special procedure, and Section 3J provided that nothing in the Land Acquisition Act would apply to such acquisitions. As a result, owners whose land was taken for highways received no solatium or interest, while owners whose land was acquired for other public purposes under the 1894 Act did. Several High Courts, including the Punjab and Haryana High Court, held Section 3J invalid to that extent, and the Union appealed.
Writing for the Court, Nariman J. held that solatium is part and parcel of the compensation for compulsory acquisition: it compensates the owner for the compulsory nature of the taking, while interest compensates for delay in payment. The object of the 1997 amendments was the speedy acquisition of land for national highways, and denying solatium and interest had no rational relation to that object.
Classifying landowners according to whether their land happened to be acquired for a national highway or for some other public purpose was therefore discriminatory: the State cannot treat equally situated owners differently merely because two acquisition statutes exist. From 1 January 2015, the compensation provisions of the 2013 Act had been applied to acquisitions under the National Highways Act, so the discrimination related to the interregnum between 1997 and 2015.
Conclusion & Ruling
- (i)
Section 3J was declared unconstitutional to the extent that it excluded solatium and interest; the provisions of the Land Acquisition Act on solatium and interest, in Section 23(1A) and (2) and Section 28, apply to acquisitions under the National Highways Act.
- (ii)
Landowners whose land was acquired for national highways between 1997 and 2015 are entitled to solatium and interest on their compensation.
- (iii)
In February 2025 the Court rejected an application by the National Highways Authority of India to make the ruling apply only prospectively, holding that this would nullify the very relief the judgment granted.