Today, On 4th February, The Supreme Court rejected NHAI’s plea to apply the Tarsem Singh verdict on compensation for landowners prospectively. A Bench comprising Justices Surya Kant and N Kotiswar Singh dismissed the request , stating that granting it would nullify the ruling. The Tarsem Singh judgment ensures fair compensation, and its retrospective application remains intact.
New Delhi: The Supreme Court rejected a plea from the National Highways Authority of India (NHAI) that sought to apply its 2019 judgment in the case of Union of India v. Tarsem Singh only on a prospective basis.
This judgment established that the provisions of the Land Acquisition Act, 1894, concerning solatium and interest, apply to land acquisitions made under the National Highways Act, 1956 (NH Act).
In its 2019 ruling, the Court declared that Section 3J of the NH Act, which excluded solatium and interest as specified in the Land Acquisition Act, was unconstitutional. The NHAI’s request aimed to limit the application of this ruling to future cases.
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A Bench of Justices Surya Kant and N. Kotiswar Singh dismissed the NHAI’s plea, stating that granting such a request would effectively nullify the Tarsem Singh verdict.
The Court explained,
“The plea seeks application (of judgment) prospectively. If we grant the prayer, it will nullify the Tarsem Singh judgment, which settled the confusion created by Section 3J of the NH Act,”
The Court expressed concern that permitting a prospective application could lead to disparities among individuals whose lands were acquired at different times.
The judges noted,
“One category was from 2015 to 2019, and another was otherwise. Creating such disparities necessitates considering the affected segment. Equity demands that such a prayer is not entertained,”
Furthermore, the Court warned that allowing the NHAI’s request could necessitate revisiting numerous land acquisition cases, leading to further delays.
The Bench stated,
“It cannot lead to revisiting cases and open a Pandora’s box… The ultimate aim was to grant solatium and interest to aggrieved landowners whose lands were taken for highways. What the applicant seeks is to further delay the issue. What cannot be done directly cannot be indirectly,”
The Court also rejected NHAI’s argument regarding a Rs. 100 crore burden, stating,
“The Rs.100 crore burden of NHAI does not persuade us. Since all NHs are under a public-private model, the burden will shift to the project proponent and then to consumers who can afford to use such highways.”
Thus, the Court reaffirmed the beneficial compensation granted under the Tarsem Singh ruling, directing the competent authority to calculate compensation and interest accordingly.
The Court ordered,
“Present application is disposed of,”
Originally, the National Highways Act, 1956, did not provide for land acquisition. Prior to the 1997 amendments, all acquisitions for national highways followed the Land Acquisition Act, which provided solatium and interest. The 1997 amendments, which inserted Section 3J, excluded the application of the Land Acquisition Act, leading to disputes over the lack of compensation.
When this matter reached the Supreme Court, the Central government contended that the NH Act was a complete code that expressly excluded the Land Acquisition Act.
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However, the Supreme Court rejected this argument, stating that the 1997 amendments discriminated against landowners whose lands were acquired for national highways compared to those whose lands were acquired for other public purposes.
The Court held that this classification lacked rational relation to the objective of expediting land acquisitions for national highways, thereby violating Article 14 of the Constitution. Consequently, the Court struck down Section 3J regarding the exclusion of compensation and interest, prompting the NHAI’s current plea for prospective application of the judgment.
Case Title: Union of India v. Tarsem Singh