SPECIAL LAND ACQUISITION OFFICER versus PUTTAIAH AND ORS.

Citation: [1995] SUPP. 2 S.C.R. 782 · Decided: 16-08-1995 · Supreme Court of India · Bench: K. RAMASWAMY, B.L. HANSARIA · Disposal: Appeal(s) allowed
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Judgment (excerpt)

A 
SPECIAL LAND ACQUISITION OFFICER 
v. 
PUTTAIAH AND ORS. 
AUGUST 16, 1995 
B 
K. RAMASWAMY AND B.L. HANSARIA, JJ.J 
Land Acquisition Act, 1894. 
Ss.11 30, JI-Interest on compensation by civil court-Acquisitioll of 
C Land-Compensation-Dispute regarding apportionment of compensa-
tion-Reference to civil Court-Amount deposited into reference court-Civil 
Court awarding interest on the amount from date of deposit till decision of 
reference under s.3()-Held, on deposit of amount into court and pending 
decision of reference, liability of State to pay interest thereon ceases from date 
of deposit. 
D 
E 
F 
G 
On a dispute as to the apportionment of the compensation, the 
Collector made a reference under s.30 of the Land Acquisition Act, 1894 
to the Civil Court, which while apportioning the compensation among the 
claimants, awarded interest at 9% per annuni. The High Court affirmed 
the order in a revision petition. Aggrieved, the State filed the appeal by 
special leave. 
Allowing the appeal, this C0urt 
HELD : 1.1. The reference court as well the High Court committed 
an obvious illegality in direction payment of interest at 9% on the amount 
of compensation from the date of deposit by the Collector till the decision 
of the reference court under s.30 of the Land Acquisition.Act, 1894. [784-D] 
Puroshotham Haridas & Ors. v.Amroth Ghee Co. Ltd., Guntur& Ors., 
AIR (1961) AP 143, disapproved. 
1.2. On making the award under s.11 of the Act, the Collector is 
enjoined to make a reference under s.30, if there is any dispute as to the 
person entitled to receive the compensation and the apportionment there· 
of. On making such reference, the Collector is further enjoined under s.31 
of the Act to deposit the amount of compensation in the court to which 
H reference under s.18 would be submitted. On deposit of the amount into 
782 
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·
SPL. LAND ACQSN. OFFICER v. PUTIAIAH 
783 
the court and pending decision of the reference, the liability of tlie State A 
to pay interest thereon ceases with effect from the date of deposit. [784-C] 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 7979 of 
1995. 
From the Judgment and Order dated 10.3.87 of the Karnataka High B 
Court in C.R.P. No. 1148 of 1987. 
M. Veerappa for the Appellant. 
The following Order of the Court was delivered : 
c 
Leave granted. 
Though the respondent have been served, none is appearing either 
in person or through counsel. The admitted position is that there being a 
dispute as to the apportionment of the compensation, the Collector made D 
a reference under s.30 of the Land Acquisition Act, 1894 (for short, 'the 
Act') and the Reference Court formed the point thus : 
"Who among the claimants are entitled to receive compensation 
and to what extent?" 
The Civil Court, while apportioning the compensation among the 
claimants, awarded interest at 9% per annum on the amount of compen-
sation. When it was challenged in Civil Revision Petition No. 1148/87 dated 
March 10, 1987, the High Court confirmed the same following a judgment 
of the Andhra Pradesh High Court Pumshotham Haridas & Ors. v. Ammth 
E 
Ghee Co. Ltd. Guntur & Ors., AIR 1961AP143. 
F 
The question is whether the view of the High Court is correct. 
Section 11 of the Act provides that the Land Acquisition Officer shall 
enquire into the respective interests of the persons claiming compensation 
or believed to have an interest therein and shall make an award; and under G 
clause (iii) of sub-section (1) apportion the said compensation among all 
persons known or believed to be interested in land, of whom or of whose 
claims, he has information whether or not they have respectively appeared 
before him. 
Under Section 30 of the Act, when the amount of compensation has H 
784 
SUPREME COURT REPORTS [1995) SUPP. 2 S.C.R. 
A 
been settled under s.11, if any dispute arises as to the apportionment of 
the same or any part thereof or as to the persons to whom the same or any 
part thereof is payable, the Collector may refer such dispute to the decision 
of the Court. Under sub-section (2) of Section 31, if there is any dispute 
as to apportionment of the compensation, the Collector shall deposit the 
B amount of compensation in the Court to which reference under Section 18 
would be submitted. 
Thus, it could be seen that on making award under s.11, the Collector 
is enjoined to make a reference under s.30, if there is any dispute as to the 
person entitled to receive the compensation and the apportionme
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