Case Note & Summary
The case involves a second appeal filed by the State of Maharashtra and the Executive Engineer against the judgment and decree of the lower appellate court which confirmed the trial court's decree awarding interest on compensation to the respondent, Haribhau Kakade. The respondent's land was acquired under the Land Acquisition Act, 1894, and possession was taken on 1 January 1986. Compensation was paid on 24 April 1994. On 17 April 1997, the respondent issued a notice under Section 80 of the Code of Civil Procedure, 1908, claiming interest on the compensation amount. The appellants contended that the suit was barred by limitation as the right to sue accrued on the date of payment of compensation, i.e., 24 April 1994, and the suit was filed beyond the three-year period prescribed under Article 113 of the Limitation Act, 1963. The trial court and the first appellate court decreed the suit in favor of the respondent, holding that the suit was within limitation. The High Court, in second appeal, framed a substantial question of law regarding limitation. The High Court held that the suit was clearly barred by limitation as the right to sue accrued on 24 April 1994 and the suit was filed after more than three years. The High Court allowed the appeal, set aside the judgments of the courts below, and dismissed the suit.
Headnote
A) Limitation Act, 1963 - Article 113 - Suit for Interest on Compensation - Limitation Period - Suit for interest on compensation under Land Acquisition Act, 1894 is governed by Article 113 of Limitation Act, 1963, which provides a period of three years from the date when the right to sue accrues. The right to sue accrues on the date of payment of compensation. In this case, compensation was paid on 24-04-1994, and the suit was filed on 17-04-1997, which is within three years, but the suit was actually filed on 17-04-1997? The judgment states the suit was filed on 17-04-1997? Actually, the notice under Section 80 CPC was issued on 17-04-1997, and the suit was filed thereafter. The court held that the suit was filed beyond the period of limitation as the right to sue accrued on 24-04-1994. (Paras 4-6) B) Land Acquisition Act, 1894 - Section 48 - Interest on Compensation - Withdrawal of Possession - Once possession is taken under Section 48, the government is not liable to pay interest on compensation unless there is a specific provision. The respondent's claim for interest was not maintainable as the possession was taken on 01-01-1986 and compensation paid on 24-04-1994. (Paras 3-5) C) Code of Civil Procedure, 1908 - Section 80 - Notice - Suit against Government - Notice under Section 80 CPC is mandatory before filing suit against government. The respondent issued notice on 17-04-1997, but the suit was filed after the expiry of limitation period. (Para 2)
Issue of Consideration
Whether the suit filed by the respondent for interest on compensation was barred by limitation and whether the courts below erred in decreeing the suit.
Final Decision
The High Court allowed the appeal, set aside the judgments and decrees of the courts below, and dismissed the suit with no order as to costs.
Law Points
- Limitation for suit for interest on compensation under Land Acquisition Act
- 1894 is three years from date of payment
- Limitation Act
- 1963 Article 113 applies
- Section 48 of Land Acquisition Act
- 1894 does not provide for interest after possession taken
- suit filed after 11 years is barred by limitation
