LexARESH @ ASHOK J. MEHTA (D) BY PROP. LRS. versus SPL. TAHSILDAR, BALGAUM KARNATAKA & ANR.
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A B c [2013) 2 S.C.R. 280 ARESH @ ASHOK J. MEHTA (D) BY PROP. LRS. v. SPL. TAHSILDAR, BALGAUM KARNATAKA & ANR. (Civil Appeal No. 5517 of 2005) MARCH 11, 2013. [G.S. SINGHVI AND SUDHANSU JYOTI MUKHOPADHAYA, JJ.] Karnataka Land Reforms Act, 1961: ss. 44 and 51 - Vesting of land in State Government - Interest on the amount payable - Held: In view of the specific clarification made by Circular dated 24.11.1986 and decision of the Court, appel/antis entitled to interest w.e.f. 1.3.1974@ 0 5 ~% till the total amount was paid to him - Substantive provision of 'mode of calculation' as prescribed u/s 51 has been clarified by Circular dated 24.11.1986 - The example cited in the circular is merely an illustration - If the illustration is in conflic with the clarification of the substantive law! E provision or if the illustration is vague, the clarification will prevail over the illustration - Government of Karnataka Rev. Dep. (Land Reforms) Circular No. ND 171 LWM 86 dated 24.11.1986. In terms of s.44 of the Karnataka Land Reforms Act, F 1961 as amended by Act No. 1 of 1974, the land belonging to the appellant and held or in possession of the tenant stood transferred and vested in the State Government w.e.f. 1.3.1974. As regards the interest on the principal amount of compensation to be paid to the G appellant, the Division Bench of the High Court, ultimately, held that the appellant was entitled to interest @ SY.% w.e.f. 1.3.1984. In the instant appeal filed by the claimants, the H 280 .. ARESH @ ASHOK J. MEHTA (D) BY PROP. LRS. v. SPL. TAHSILDAR, 281 BALGAUM KARNATAKA questions for consideration before the Court were: (i) A whether with respect to the delayed payment of the principal amount, the appellant is entitled for any interest towards the amount paid in cash and thereby the Circular dated 24.11.1986, contrary to such extent is liable to be set aside"; and (ii) "whether the appellant is entitled for B payment of interest as per Circular No. ND 171 LWM 86 dated 24.11.1986 or as a matter of general rule." Allowing the appeal, the Court HELD: 1.1. The amount payable to the land-owner/ C landlord for the extinguishment of their rights is to be paid in the manner prescribed u/s 51 of the Karnataka Land Reforms Act, 1961. Substantive provision of 'mode of calculation' as prescribed u/s 51 has been clarified by Circular dated 24.11.1986. There is no ambiguity in the D clarification made by circular dated 24.11.1986, but the example cited therein is not only confusing but also contradictory to the main clarification. The example cited in the circular is merely an illustration. If the illustration is in conflict with the clarification of the substantive law/ E provision or if the illustration is vague, the clarification will prevail over the illustration. In such case, a person who is entitled to the interest as per the clarification cannot be deprived of or denied his right relying on the illustration. [para 15, 20 and 21] [293-D; 296-F-H; 297-A] F 1.2. As per Circular dated 24.11.1986, the entire amount of compensation payable to the ex-landlords along with interest is to be calculated taking 1.3.1974 as the cut off date upto 1.3.1984. But if the amount is paid G earlier then upto the date of payment. Out of the total amount two thousand rupees is to be paid in cash and the rest through National Savings Certificates. If the amount is not paid on or before 1.3.1984, provisions have been made to pay further interest @ 5 Y.% on the entire H 282 SUPREME COURT REPORTS (2013] 2 S.C.R. A principal amount from 1.3.1984 till the date of purchase of the National Savings Certificates; that means the authorities are required to either invest the amount in National Savings Certificates or pay interest till the B amount is invested. [para 19] [296-C-E] 1.3. In view of the specific clarification made by Circular dated 24.11.1986 and decision of this Court in Satinder Singh, the appellant is entitled to interest w.e.f. 1.3.1974@5 V.% till the total amount was paid to him. The C respondent cannot deny the interest on the amount of compensation to which the appellant is entitled as a matter of general rule, and in the light of the clarification made by Circular dated 24.11.1986. The orders passed by the Single Judge and the Division Bench of the High Court are set aside. The respondents are directed to pay D the appellant interest@ 5 V.% per ann
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