Madhya Pradesh High Court
Smt.Ramibai vs Chief Executive Officer on 10 July, 2017
Author: Vivek Rusia
Bench: Vivek Rusia
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HIGH COURT OF MADHYA PRADESH, JABALPUR
BENCH INDORE
( Single Bench )
( Hon'ble Shri Justice Vivek Rusia)
First Appeal No.131 of 1999
Gaurishankar s/o Chenaji and others
VERSUS
Chief Executive Officer, Ujjain Development Authority, Ujjain and 2
others
*****
Shri B.L.Pavecha, learned Senior Counsel with Shri Ayushman
Choudhary, learned counsel for the appellants.
None for the Respondent No.1/UDA.
Shri Rohit Mangal, learned Govt. Advocate for the Respondent
Nos.2 and 3/State.
*****
JUDGMENT
( Delivered on this 10th day of July, 2017 ) THE appellants have filed this appeal being aggrieved by Award dated 16.09.1998 passed in Reference Land Acquisition Case No.26/1998 by VIth Additional Judge to the Court of District Judge, Ujjain.
[2] Facts of the case, in short, for disposal of this appeal are as under :-
(a) That Ujjain Development Authority in order to implement Scheme No.23 has requested the State Government to acquire the large area of land under the provisions of the Land Acquisition Act,1894 [in brief "the Act of 1894"]. The State Government has issued a
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Notification under Section 4 (1) of the Act of 1894 on 03.07.1985 for acquiring 27.438 hectare land of Village Nanakheda. Later on the said entire land has been reserved in the Master Plan with the object to develop as residential area. After deciding the objections received, a Notification under Section 6 of the Act of 1984 was issued on 25.07.1985 declaring the said land is need for public purpose.
(b) In the aforesaid land acquisition proceedings, agriculture land owned by the appellants Survey No.438/1 area 0.784 hectare and land Survey No.504/1 area 1.620 hectare, thus total 2.404 hectare of Nanakheda have also been acquired. Appellant have file an objection before the Land Acquisition Officer and thereafter filed the writ petition before this Court challenging the Notifications under Sections 4 and 6 of the Act of 1894. Before the High Court, the appellants have submitted that if the land is acquired, then a compensation @ Rs.50-00 per sq.ft. with Rs.90,000-00 for 3 Well and 2 houses and trees be given to them.
(c) That High Court of Madhya Pradesh, Bench at Indore has allowed all the writ petitions and set-aside the Notification under Section 4 of the Act of 1984 upholding that the Scheme No.23 framed under Madhya Pradesh Nagar Tatha Grqam Nivesh Adhiniyam, 1973 but same does not operate against certain specific lands of the petitioners. The aforesaid order of this Court was challenged before the Supreme Court by the Ujjain Development Authority. Vide judgment dated 14.11.1991 in Civil Appeal No.4554 of 1991
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the Apex Court has upheld the Notification under Section 4 of the Act of 1984 with the direction that the land of the appellants shall be deemed to have been notified under Section 4 of the Act of 1984 on 1.1.1988.
(d) The Land Acquisition Officer after concluding its proceedings, passed the Award on
22.07.1988. The Land Acquisition Officer has treated all the land as agricultural land and calculated the compensation @ Rs.1,56,905-00 per hectare. The appellants were granted the compensation of their land Rs.6,22,383-00 and Rs.38,940-00 for 2 houses and 3 Wells. No separate compensation has been awarded for the trees ,motor fencing etc..
(e) Being dissatisfied with the amount of compensation, the appellants sought the reference on
05.09.1988 and same was referred to the District Judge Ujjain for adjudication under section 18 of Act of 1894.
(f) The appellants has filed the detailed reference application seeking enhancement of the compensation on various grounds. The appellants have
claimed that entire land was irrigated land at the time of issuance of notification under sec 4 of Act of 1894, therefore, they are entitled for compensation double to the market rate of the land. It has been further pleaded that nearby land of their acquired land has been developed as residential area, therefore, they are entitled compensation @ Rs.50-00 per sq.ft. The Land Acquisition Officer has awarded less amount of compensation for 3 Wells and 2 houses and did not grant the compensation for trees of
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Mango, Jamoon, Babool and Chandan etc. for which they are entitled Rs.49,000-00. The appellants had electricity connection and wire fencing over the land for which they are entitled Rs.25,000-00.
(g) On the basis of pleadings, the Additional District Judge framed 5 issues for adjudication.
(h) The appellants have filed various sale-deeds by which the lands of nearby area were sold @ Rs.6, Rs.7 and Rs.10 per sq.ft. The appellants examined Ashok Joshi as PW-1; Gaurishankar as PW-2; Wahid Qureshi as PW-3 and Babulal Jain as PW-4. In reply the Ujjain Development Authority examined Nandram, retired Patwari as DW-1.
(i) The learned Additional District Judge has held that the appellant are entitled for the compensation for their land @ Rs.3.00 per sq.ft. and refused to enhance the compensation for Wells, houses, trees etc. . The learned Additional District Judge has placed reliance over the Award dated 12.01.1990 passed in Reference Case Nos.20/1988 and 23/1988 in which also certain lands were acquired for residential purpose under the scheme of Ujjain Development Authority and compensation @ Rs.3.00 per sq.ft. was awarded.
(j) That Vide Award dated 16.09.1998 the learned Additional District Judge has granted compensation @ Rs.3.00 per sq.ft. i.e. Rs.7,74,000-00 with interest @ 9% per annum from the date of compensation till 1 year, thereafter @ 15% till the amount is deposited in the Court. The learned Additional District Judge has also awarded
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solatium @ 30%.
(k) Being dissatisfied by the Award passed by the Reference Court, the appellants have preferred this appeal before this Court.
[3] In this appeal, the appellants have claimed the following enhancement in the compensation :-
"(A) Rs.7,76,274/- (Seven lacs seventy six thousand two hundred seventy four only) for the land acquired.
(B) Rs. 50,000/- (Fifty thousand) for 2 houses and 3 wells. (C) Rs. 39,000/- (Thirty Nine Thousand) for the acquisition of trees.
(D) Rs. Solatium at the rate of 30% on the aforesaid amount."
[4] Shri B.L.Pavecha, learned Senior Counsel appearing on behalf of the appellants/land owners emphasized that all the lands of the appellants were irrigated land hence the learned Additional District Judge ought to have adopted the different yardstick for awarding compensation to the appellants Being irrigated lands the appellants are entitled for compensation at the rate of double to the compensation granted to the other land owners for their non irrigated land. The evidence led by the appellants remained un-controverted on the point of enhancement of compensation. He has placed reliance over the judgment of apex Court in the case of Sunder v/s Union of India [(2001) 7 SCC 211]; Udho Dass v/s State of Haryana [(2010) 12 SCC 51]; Ujjain Vikas Pradhikaran v/s Rajkumar Johri [1992 JLJ 118]; M.P.Housing Board v/s Mrs. Neera Kapoor [2004 (1) MPHT 422]; Chindha Fakira Patil v/s The Special Land Acquisition Officer, Jalgaon [(2011) 10
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SCC 787] and Premji Nathu v/s State of Gujrat [(2012) 5 SCC 250]. He has further submitted that the Reference Court has wrongly ignored the sale-deeds produced by the appellants which clearly establish that the land of same vicinity sold between Rs.6.00 to Rs. 10.00 per sq.ft . The learned Land Acquisition Officer as well as the Reference Court has failed to award additional compensation @ 12% per annum from the date of Notification under Section 4 of the Act till the date of Collector's Award which is mandatory under Section 23 (1-A) of the Act of 1984. The interest on solatium from the date of Award till its realization ought to have been granted to the appellants as held by the apex Court in the case of Sunder (supra).
[5] Despite notice no one has appeared on behalf of the Ujjain Development Authority/Respondent No.1, to oppose the arguments of counsel for the appellants.
[6] Shri Rohit Mangal, learned Govt. Advocate appearing on behalf of Respondent Nos.2 and 3/State has argued in support of the Award passed by the Reference Court and according to him the Land Acquisition Officer and Reference Court has granted the compensation @ Rs.3.00 per sq.ft. for all lands irrespective of their categories as agricultural or non-agricultural land The rate of Rs.3.00 per sq.fit which was prevailing at the relevant time is sufficient and not liable to be enhanced . In case of other land owners, the Reference Court has granted compensation the same rate. Therefore, no interference is called for.
[7] Before appreciating the rival submissions
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raised by the learned counsel for the parties, it would be appropriate to have in mind certain decisions of apex Court in this field. That when the land owners have sought the reference for enhancement of compensation, then the burden lies on them to prove by adducing reliable evidence that the compensation offered by the Land Acquisition Officer is inadequate and the lands are capable of fetching higher market value. In case of Basant Kumar v/s Union of India [(1996) 11 SCC 542]; Special Land Acquisition Officer, v/s Karigowda [(2010) 5 SCC 708] and Ahmedabad Municipal Corpn. v/s Sharadaben [(1996) 8 SCC 93], the apex Court has held that it is for the appellant to prove his case if he is claiming enhancement of a compensation granted by the Land Acquisition Officer. It is the duty of the Court to scrutinize the evidence and apply the test of prudent and willing purchaser whether he would be willing to purchase in market the said very land. In the case of Hookiyar Singh v/s Special Land Acquisition Officer [(1996) 3 SCC 766], it has been held that the Court must not indulge in the feats of imagination but consider the very fact that the prudent purchaser in open market is ready to purchase the said land at the rate claimed by the claimants. It has also been held by the apex Court in the case of G.Narayan Rao v/s Land Acquisition Officer [(1996) 10 SCC 607] that the claimants must establish that at the time of date of notification under Section 4 of the Act of 1984, any buyer or purchaser are available.
The similar view has been followed in the case of State
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of U.P. v/s Ram Kumari Devi [(1996) 8 SCC 577]. In the case of Gujrat Industrial Development Corporation v/s Narottambhai Morarbhai [(1996) 11 SCC159], the apex Court has observed that the criteria and rate for sale of small piece of land and big area of the land are always different. The small plots are easily saleable at higher rate; whereas the large area of the plots do not get the higher rates. Therefore, while assessing the compensation the Court must keep in the mind that area of the land under acquisition.
[8] For the purpose of calculation of compensation and to arrive fair market value of agricultural land various facts and circumstances of the case are liable to be consider by the court. The Courts have been exercised their discretion by adopting different methods; like (a) Sales statistics method; (b) Capitalisation of net income method; and (c) Agricultural yield basis method. The Supreme Court in the case of Special Land Acquisition Officer v/s Karigowda [(2010) 5 SCC 708] has held as under :-
"70. To examine what method could be adopted for determining the market value of land and criticism of the method adopted by the Land Acquisition Collector, by the courts, that the same is not in accordance with law, we must notice various methods which are normally adopted by the Courts for determining the fair market value of the land and which of the method can be more properly applied in the facts and circumstances of this case.
71. Sections 23 and 24 of the Act spell out the have and have nots, applicable to the scheme of awarding compensation by the Collector but do not describe the methodology which should be adopted by the courts in determining the fair market value of the land at the relevant time. By development of law, the courts have adopted different methods for computing the compensation payable to the land owners depending upon the facts and circumstances of the case. The Courts have been
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exercising their discretion by adopting different methods, inter alia the following methods have a larger acceptance in law :
(a) Sales Statistics Method : In applying this method, it has been stated that, sales must be genuine and bonafide, should have been executed at the time proximate to the date of notification under Section 4 of the Act, the land covered by the sale must be in the vicinity of the acquired land and the land should be comparable to the acquired land. The land covered under the sale instance should have similar potential and occasion as that of the acquired land {Faridabad Gas Power Project, N.T.P.C. Ltd. & Ors. v. Om Prakash & Ors. [2009 (4) SCC 719], Shaji Kuriakose & Anr. v.
Indian Oil Corp. Ltd. & Ors. [AIR 2001 SC 3341], Ravinder Narain & Anr. v. Union of India [2003 (4) SCC 481]}.
(b) Capitalization of Net Income Method : This method has also been applied by the courts. In this method of determination of market value, capitalization of net income method or expert opinion method has been applied. {Union of India & Anr. v. Smt. Shanti Devi & Ors. [1983 (4) SCC 542], Executive Director v. Sarat Chandra Bisoi & Anr. [2000 (6) SCC 326], Nelson Fernandes & Ors. V. Special Land Acquisition Officer, South Goa & Ors. (supra).
(c) Agriculture Yield Basis Method : Agricultural yield of the acquired land with reference to revenue records and keeping in mind the potential and nature of the land - wet (irrigated), dry and barren (banjar).
72. Normally, where the compensation is awarded on agricultural yield or capitalization method basis, the principle of multiplier is also applied for final determination. These are broadly the methods which are applied by the courts with further reduction on account of development charges. In some cases, depending upon the peculiar facts, this Court has accepted the principle of granting compound increase at the rate of 10% to 15% of the fair market value determined in accordance with law to avoid any unfair loss to the claimants suffering from compulsive acquisition. However, this consideration should squarely fall within the parameters of Section 23 while taking care that the negative mandate contained in Section 24 of the Act is not offended. How one or any of the principles afore stated is to be applied by the courts, would depend on the facts and circumstances of a given case.
75. It is a settled principle of law that lands of adjacent villages can be made the basis for determining the fair market value of the acquired land. This principle of law is qualified by
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clear dictum of this Court itself that whenever direct evidence i.e. instances of the same villages are available, then it is most desirable that the court should consider that evidence. But where such evidence is not available court can safely rely upon the sales statistics of adjoining lands provided the instances are comparable and the potentiality and location of the land is somewhat similar. The evidence tendered in relation to the land of the adjacent villages would be a relevant piece of evidence for such determination. Once it is shown that situation and potential of the land in two different villages are the same then they could be awarded similar compensation or such other compensation as would be just and fair.
76. The cases of acquisition are not unknown to our legal system where lands of a number of villages are acquired for the same public purpose or different schemes but on the commonality of purpose and unite development. The parties are expected to place documentary evidence on record that price of the land of adjoining village has an increasing trend and the court may adopt such a price as the same is not impermissible. Where there is commonality of purpose and common development, compensation based on statistical data of adjacent villages was held to be proper. Usefully, reference can be made to the judgments of this Court to the cases of Kanwar Singh & Ors. v. Union of India [JT 1998 (7) SC 397] and Union of India v. Bal Ram & Anr. [AIR 2004 SC 3981].
77. In this regard we may also make a reference to the judgment of this Court in the case of Kanwar Singh & Ors. v. Union of India [AIR 1999 SC 317], where sale instance of the adjacent villages were taken into consideration for the purpose of determining the fair market value of the land in question and their comparability, potential and acquisition for the same purpose was hardly in dispute. It was not only permissible but even more practical for the courts to take into consideration the sale statistics of the adjacent villages for determining the fair market value of the acquired land."
[9] The Division Bench of this Court in the case of M.P.Housing Board (supra) has also scrutinized the various judgments of the apex Court in respect of calculation of amount of compensation. Para 14 to 18 of the judgment are reproduced below :-
"14. In the case of Kanwar Singh v. Union of India, (1998) 8 SCC 136, it has been held that the amount of compensation for the land acquired depends on the market value of land on the
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date immediately before the notification under Section 4 of the Act or when same land is acquired and offer of compensation is made through an award. The market value has to be determined on the basis of evidence produced before the Court. It was further held that the consideration in terms of price received for land under bona fide transactions on the date or preceding the date of notification issued under Section 4 of the Act generally shows the market value of the acquired land and the market value of the acquired land to be assessed in terms of those transactions. It is also noteworthy to state here that in the case of Hansali Walichand v. State of Maharashtra, (1998) 2 SCC 388, Their Lordships held that the land having future potential on account of its location can not be ignored and realised potential is not the sole pivotal factor.
15. In this regard it is noteworthy to refer to the decision rendered in the case of Land Acquisition Officer, Revenue Divisional Officer v. L. Kamalamma, (1998) 2 SCC 385, where in it has been held by Their Lordships that when no sales of comparable land were available where large chunks of land had been sold, even land transactions in respect of small extent of land could be taken note of as indicating the price that it may fetch in respect of large tracts of land by making appropriate deductions such as for development of the land by providing enough space for roads, sewers, drains, expenses involved in formation of a layout, lump sum payment as also the waiting period required for selling the sites that would be formed.
16. In this case we may also refer to the decision rendered in the case of Union of India v. Mangat (Dead) by L.Rs. and Ors., (2000) 10 SCC 609, wherein Their Lordships held in Para 8 as under:--
"8. Even if one was to disregard the quality of the land, i.e., irrigated, semi-irrigated or barren, one can not be oblivious of the fact that the market value of land which abuts on the national highway would be much more than the land which is away from it. A price of the land which is landlocked and which is farther away from the national highway can not be the same as that which abuts on the national highway. The formula which had been applied by the High Court, however, seems to indicate that the price of the entire land irrespective of the location of different parcels of land is the same. The formula which was applied by the learned Single Judge of the High Court is obviously incorrect."
17. In this regard we may profitably refer to the decision rendered in the case of Kasturi v. State of Haryana, (2003) 1 SCC 354, wherein it was held when there is difference between a developed area and an area having potential value though yet to be developed cut 20% towards development charges as against the normal 1/3rd, from the amount of compensation
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was treated to be justified in the facts and circumstances of the case.
18. In this regard it is worth referring to the decision rendered in the case of Land Acquisition Officer v. B. Vijender Reddy and Ors., (2001) 10 SCC 669. In the aforesaid case a two Judge Bench of the Apex Court held as under:--
"13 ....... It is true, in the fixation of rate of compensation under the Land Acquisition Act, there is always some element of guesswork. But that has to be based on some foundation. It must spring from the totality of evidence, the pattern of rate, the pattern of escalation and escalation of price in the years preceding and succeeding Section 4 notification etc. In other words, the guesswork could reasonably be inferable from it. It is always possible to assess the rate within this realm. In the present case, we find there are three exemplars, i.e., Exhibits A-l and A-2 which are three years preceding the date of notification and Exhibit A-3 which is of the same point of time when Section 4 notification was issued."
[10] Keeping in view of the above ruling in the field , the case the appellants is liable to be consider for the enhancement of compensation for their land @ Rs.6.00 per sq.ft. In support of their claim, they got exhibited various sale-deeds of the relevant period by which certain lands of nearby land were sold. The learned Reference Judge has scrutinized all the sale-deeds exhibited as Exs.P/4, P/5 and P/6 and found that these sale-deeds were executed in respect of the small area of land from 1000 sq.ft. to 1500 sq.ft. at the average rate of Rs.6.00 and Rs.7.00 per sq.ft. These sale- deeds were executed between 1983 to 1986 but in the present case the total land of the appellants are 2.404 hectares, therefore, as per the law laid down by the apex Court, the appellants cannot expect the same price under which the small piece of the lands were sold. But in the present case the apex Court in Civil Appeal No.4554 of 1991
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has held that the date of notification under Section 4 of the Act of 1984 would be treated as "01.01.1988". The Reference Court has decided to give the compensation @ Rs.3.00 per sq.ft. because in another Reference Case Nos.20/88 and 23/88 the Reference Court has granted the compensation on the same rate by Award dated 12.01.1990. The Award dated 12.01.1990 was passed and the rate @ Rs.3.00 per sq.ft. was decided keeping in view the date of Notification under Section 4 of the Act of 1984 on 03.07.1985. But the apex Court in the aforesaid Civil Appeal has held that the date of Notification under Section 4 of the Act of 1984 would be "01.01.1988". Therefore, the rate of the land as on 01.01.1988 is required to be taken into consideration. From year 1983 to 1986 the rate of the land of small piece of land were Rs.5.00 and Rs.7.00 per sq.ft. for small plots Therefore, it would be proper to grant the compensation to the appellants for their large are of land @ Rs.5.00 per sq.ft. treating the date of Notification under Section 4 of the Act of 1984 as 01.01.1988. The amount awarded is modified to the extent that the appellants are entitled for compensation @ Rs.5.00 per sq.ft. for their land in place of Rs. 3.00 per sq. fit.
[11] That learned senior counsel Shri Pavecha have raised the ground that since lands were irrigated land, therefore, they are entitled for double compensation. If the appellants are claiming that their land is irrigated land, then they were required to prove that how much crops they are taking from the said lands. The case of the appellants is that
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because there are 3 Wells in the land, therefore, the land should be treated as irrigated land but they have not produced any document to prove that how much crops they are taking from the lands. Therefore, compensation cannot be calculated on the case of "Agricultural yield basis method". Since the appellants have filed the various sale- deeds and claimed the compensation on the basis of sale statistics" method and learned Reference Court has calculated the compensation on that basis. Even otherwise the Land Acquisition Officer has calculated the compensation treating all the land as agricultural land. Therefore, the appellants are not entitled for compensation at double rate.
[12] The appellants have also claimed compensation for 3 Wells and 2 Houses for which the land Acquisition Officer has awarded Rs.23,600-00 and upheld by the Reference Court.
[13] In this appeal the appellants claimed compensation of Rs.50,000-00 for 2 houses and 3 Wells. The appellants have got exhibited the report of Architect Engineer Mr. Wahid Qureshi and examined him as PW-3. The valuation report is Ex.P/3. Therefore, the claim of Rs.50,000-00 for 2 houses and 3 Wells as claimed is not excessive and same is allowed.
[14] The appellants have also claimed Rs.39,000-00 for the trees. That PW-2 Gaurishankar in his deposition has stated that in his agricultural field various trees of Jamoon and Mangos are there. But in the cross-
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examination he has admitted that there is no entry in the revenue record. He has further stated that he has requested to the revenue officer to make entries in the records about threes but that has not been done. The defendant's witness Nandram, Retired Patwari in his cross-examination has admitted that there are 2 Wells and the trees in the land of the appellants. He has also admitted a house is constructed over the land. There are certain entries of trees in the revenue record filed by the appellants. The appellants are the owner of large area of the land to the extent of 2.404 hectares and it is not possible that there would not be any trees. Therefore, under the head of trees, it would be proper to award Rs.25,000-00.
[15] The appellants have claimed additional compensation @ 12% per annum from the date of Notification under Section 4 of the Act of 1984 till the award dated 22.04.2008 under Section 23 (1-A) of the Act of 1984.That neither the Land Acquisition Officer nor the Reference Court has awarded interest under Section 23 (1-A) of the Act of 1984. The award of interest under second 23 (1-A) is mandatory and it is the duty of the Court to award in every case. The appellants are liable to be granted amount calculated @ 12% per annum on market value of the land for the period commencing on the date of publication of the Notification under Section 4 (1) of the Act of 1984 and till the date of award.
[16] In the case of Sunder (supra), the apex Court has held that the interest on Solatium amount are also
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liable to be paid, when the compensation has not paid or deposited on or before taking the possession of the land because the Solatium is a part of compensation. Para 24 of the order is reproduced below :-
"24. The proviso to Section 34 of the Act makes the position further clear. The proviso says that "if such compensation" is not paid within one year from the date of taking possession of the land, interest shall stand escalated to 15% per annum from the date of expiry of the said period of one year "on the amount of compensation or part thereof which has not been paid or deposited before the date of such expiry". It is inconceivable that the solatium amount would attract only the escalated rate of interest from the expiry of one year and that there would be no interest on solatium during the preceding period. What the legislature intended was to make the aggregate amount under Section 23 of the Act to reach the hands of the person as and when the award is passed, at any rate as soon as he is deprived of the possession of his land. Any delay in making payment of the said sum should enable the party to have interest on the said sum until he receives the payment. Splitting up the compensation into different components for the purpose of payment of interest under Section 34 was not in the contemplation of the legislature when that section was framed or enacted."
In view of the above , the appellants are also held entitled for the interest on the aggregate amount including solatium.
[18] Accordingly this appeal is allowed in part to the extent indicated hereinabove. The record of Reference Land Acquisition Case No.26/1998 be send back to the court VIth Additional Judge to the Court of District Judge, Ujjain to calculate the amount of compensation as held above. No order as to cost.
[ VIVEK RUSIA ] JUDGE Sharma AK/*