Case Note & Summary
The case involves a Civil Revision Application filed by the State of Goa and the Additional Collector & Land Acquisition Officer against the legal heirs of Domingos M. L. Merglhao. The dispute arose from a land acquisition matter where the Reference Court had passed an Award enhancing compensation. The State challenged the Award in First Appeal No. 91 of 1992, and this Court stayed execution subject to depositing the awarded amount, which the State did. The First Appeal was partly allowed on 03.08.1996, reducing the compensation. Subsequently, an application for withdrawal of excess deposit was allowed on 21.11.1997, directing payment of Rs.2,87,146 to the State and Rs.1,26,000 to the claimant, with accrued interest to be refunded. The claimant then filed an Execution Application contending that the amount paid was deficient as no interest under Section 28 of the Land Acquisition Act was paid. The executing court directed payment of interest, leading to the present revision. The legal issue was whether the deposit of compensation in court as a condition for stay stops further interest under Section 28. The High Court held that interest under Section 28 continues to accrue until actual payment to the claimant, and mere deposit in court does not constitute payment. The court reasoned that the deposit was only a condition for stay and did not discharge the liability to pay interest. The executing court's order was upheld, and the revision was dismissed.
Headnote
A) Land Acquisition - Interest under Section 28 - Cessation of Interest - Deposit of compensation in court as condition for stay does not stop further interest under Section 28 of the Land Acquisition Act, 1894 - The court held that interest continues to accrue until the amount is actually paid to the claimant, and mere deposit in court does not amount to payment to the claimant. The executing court's order directing payment of interest was upheld. (Paras 2-5)
Issue of Consideration
Whether deposit of compensation awarded by the Reference Court to obtain a stay of execution of the Award ceases the payment of further interest under Section 28 of the Land Acquisition Act?
Final Decision
The High Court dismissed the Civil Revision Application, upholding the executing court's order directing payment of interest under Section 28 of the Land Acquisition Act. The court held that deposit of compensation in court as a condition for stay does not stop further interest; interest continues to accrue until actual payment to the claimant.
Law Points
- Interest under Section 28 of Land Acquisition Act continues to accrue until actual payment to the claimant
- deposit in court as condition for stay does not stop interest
- Section 28 interest is compensatory not penal
Case Details
2013 LawText (BOM) (07) 136
CIVIL REVISION APPLICATION NO. 17 OF 2011
Ms. Priyanka Kamat, Addl. Government Advocate for the Petitioners; Mr. D. Pangam, Advocate for the Respondents
State of Goa, Through the Chief Secretary, Secretariat, Porvorim, Goa, Represented by Executive engineer, Works Division-I (BUILDING), P.W.D., Patto, Panaji, Goa; Additional Collector & Land Acquisition Officer, Office of the Collector of North Goa, Panaji, Goa
Domingos M. L. Merglhao (since deceased) through legal heirs: Mrs. Clementina D' Souza e Mergulhao, Smt. Anita Mergulhas (D' Souza), Shri Leandro Urbano Mergulhao, Smt. Jonita Mergulhao (Prazares), Shri Renado Mergulhao, Smt. Liza Mergulhao (Aguiar), Shri Nixan Mergulhao, Shri Rei Mergulhao, Raymond Mergulhao, Smt. Livia Mergulhao (D'Souza), Shri Justin Mergulhao
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Nature of Litigation
Civil Revision Application challenging the order of the executing court directing payment of interest under Section 28 of the Land Acquisition Act.
Remedy Sought
The petitioners (State of Goa and Land Acquisition Officer) sought to set aside the executing court's order directing payment of interest under Section 28.
Filing Reason
The petitioners contended that the deposit of compensation in court as a condition for stay of execution of the Award stopped further interest under Section 28.
Previous Decisions
The Reference Court passed an Award enhancing compensation. The State challenged it in First Appeal No. 91 of 1992, which was partly allowed on 03.08.1996 reducing compensation. An application for withdrawal of excess deposit was allowed on 21.11.1997. The claimant then filed an Execution Application for interest under Section 28, which was allowed by the executing court.
Issues
Whether deposit of compensation awarded by the Reference Court to obtain a stay of execution of the Award ceases the payment of further interest under Section 28 of the Land Acquisition Act?
Submissions/Arguments
Petitioners argued that the deposit of the awarded amount in court as a condition for stay should stop further interest under Section 28.
Respondents argued that interest under Section 28 continues until actual payment to the claimant, and deposit in court does not amount to payment.
Ratio Decidendi
Interest under Section 28 of the Land Acquisition Act is compensatory in nature and continues to accrue until the amount is actually paid to the claimant. Mere deposit of the amount in court as a condition for stay of execution does not amount to payment to the claimant and does not stop the running of interest.
Judgment Excerpts
The short point for consideration in the above revision is as to whether a deposit of the compensation awarded by the Petitioners to obtain a stay of the execution of the Award passed by the Reference Court whilst disposing a reference under Section 18 of the Land Acquisition Act, would cease the payment of further interest in terms of Section 28 of the Land Acquisition Act ?
The learned Judge after hearing the parties, by the impugned Order, directed the Petitioners to pay interest in terms of Section 28 of the said Act.
Procedural History
Reference Court passed Award enhancing compensation. State filed First Appeal No. 91 of 1992, which was partly allowed on 03.08.1996 reducing compensation. Application for withdrawal of excess deposit allowed on 21.11.1997. Claimant filed Execution Application for interest under Section 28. Executing court allowed the application. State filed Civil Revision Application No. 17 of 2011, which was dismissed on 12.07.2013.
Acts & Sections
- Land Acquisition Act, 1894: Section 18, Section 28
