The Supreme Court of India held that pre-2018 land acquisition cases under the NHAI Act cannot be reopened for interest-bearing compensation, as CJI Surya Kant and Justice Ujjal Bhuyan heard NHAI’s plea reviewing the 2019 retrospective compensation ruling.
NEW DELHI: The Supreme Court stated that pre-2018 land acquisition cases cannot be reopened to award compensation with interest to farmers whose land was acquired under the NHAI Act. This observation came from a special bench featuring Chief Justice Surya Kant and Justice Ujjal Bhuyan as they started hearings for a plea from the National Highway Authority of India (NHAI), which is seeking a review of a 2019 ruling from the apex court.
In that 2019 judgment, the court ruled that the granting of compensation with interest to farmers based on land acquisitions under the NHAI Act would be applied retroactively.
Solicitor General Tushar Mehta, representing the NHAI, argued that the 2019 ruling imposed a substantial financial burden of approximately Rs 32,000 crore and should only take effect prospectively.
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The bench had previously dismissed this argument, highlighting that denying such benefits would violate Article 14 (right to equality) of the Constitution.
Mehta remarked,
“What perhaps weighed with your lordship was that it was Rs 100 crore,”
He also referred another judgment where the Supreme Court stated that no cases already decided would be reopened.
The Chief Justice noted,
“The cut-off date appears to be of 2008, provided claims were alive then. Pre-2018 matters cannot be reopened. Those matters which were pending in 2008 continue. If someone in the early 2020s filed an application saying they are entitled to parity based on 2008, we can say yes as the solatium but not interest, like in land acquisition matters.”
The bench heard brief arguments from both sides and requested written submissions, scheduling the review plea for discussion in two weeks. On November 4 of last year, the CJI-led bench had agreed to publicly hear the NHAI’s plea to review its verdict and subsequently issued a notice on the review request, with the matter set for a public hearing on November 11, 2025. The Solicitor General indicated that this controversy would carry significant implications, amounting to around Rs 32,000 crore, not Rs 100 crore as previously asserted in the petition.
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On February 4, 2025, the Supreme Court dismissed the NHAI’s plea, affirming that its 2019 decision allowing compensation and interest to farmers whose lands were acquired under the NHAI Act would indeed apply retroactively. The NHAI had sought that the judgment from September 19, 2019, be applied prospectively to prevent reopening cases with completed land acquisition proceedings where compensation had been finalized.
The bench concluded,
“We find no merit in the contentions raised by the applicant, NHAI. We reaffirm the principles established in Tarsem Singh (2019 decision) regarding the beneficial nature of granting ‘solatium’ and ‘interest’ while emphasizing the need to avoid creating unjust classifications lacking intelligible differentia. Consequently, we deem it appropriate to dismiss the present miscellaneous application.”
The Supreme Court’s 2019 decision found Section 3J of the NHAI Act unconstitutional, as it excluded the applicability of the Land Acquisition Act of 1894 and denied solatium and interest for lands acquired under the NHAI Act, thus violating Article 14 of the Constitution.
It further clarified that the prayer in the current application sought to clarify that the Tarsem Singh decision should operate prospectively only. In the court’s considered view, granting such clarification would effectively nullify the relief intended by the Tarsem Singh judgment, as it would restore conditions to those before the ruling.
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Referencing the 2019 judgment, which deemed Section 3J unconstitutional, the court noted that a primary goal behind the Tarsem Singh verdict was to resolve the complexities created by Section 3J of the NHAI Act, which resulted in unequal treatment of similarly situated individuals.
The court stated,
“The impact of Section 3J was short-lived, owing to the applicability of the 2013 Act upon the NHAI Act from January 1, 2015. As a result, two classes of landowners emerged, devoid of any intelligible differentia: those whose lands were acquired by the NHAI between 1997 and 2015, and those whose lands were acquired otherwise,”
Additionally, the Supreme Court clarified that the ultimate outcome of its 2019 ruling was restricted to granting solatium and interest to affected landowners whose lands were acquired by the NHAI from 1997 to 2015 and did not direct the reopening of cases that had already been finalized.