R.K. Deshpande, J.
1. In Land Acquisition Case No.37 of 1997, the Reference Court, in exercise of its jurisdiction under Section 18 of the Land Acquisition Act, 1894, has held on 30-9-2000 that the respondent-claimant shall be entitled to compensation at the rate of Rs.50,000/- per hectare for the land acquired, and Rs.10,000/- for well. The Reference Court has further directed that the claimant should be paid additional component on the amount of enhanced compensation at the rate of twelve per centum per annum from the date of the possession, i.e. from July, 1985, till the date of the award, i.e. 16-9-1995. The learned Single Judge (Shri Z.A. Haq, J.) has rejected all the challenges to the determination of market rate and to the award of compensation for the well.
2. This reference to a Larger Bench is concerned with the direction of the Reference Court to the appellant-State to pay to the respondent-claimant an interest at the rate of nine per centum per annum on the amount of enhanced compensation of the land, for the first year from July, 1985 to June, 1986, and thereafter, at the rate of fifteen per centum per annum from July, 1986 till the date of its realization.
3. The undisputed factual position is that the possession of the land under acquisition was taken by the Government in the month of July, 1985 and the notification under Section 4(1) of the Land Acquisition Act was issued on 16-9-1993. The award was passed on 19-9-1995. Thus, the actual physical possession of the land under acquisition is prior in point of time and it is followed by a notification under Section 4(1), declaration under Section 6, and the award under Section 11 of the said Act.
4. The Division Bench of this Court (Smt. Vasanti A. Naik and Shri Prasanna B. Varale, JJ.) has held in the case of Lalitkumar Himmatlal Shah v. State of Maharashtra and others, reported in 2012(4) Mh.L.J. 742, after following the decision of the Apex Court in the case of R.L. Jain (D) By LRs. v. DDA and others, reported in (2004) 4 SCC 79, that the interest under Section 28 or 34 of the Land Acquisition Act shall be payable from the date of the award, if the possession of the land acquired was taken prior to issuance of notification under Section 4(1) of the said Act. This decision was relied upon by the learned Assistant Government Pleader for the appellant-State to urge that the direction issued by the Reference Court in the present case to pay the interest at the rate of nine and fifteen per centum per annum from the date of taking over possession of the land in the month of July, 1985, is contrary to the law laid down by this Court.
5. The learned Single Judge (Shri Z.A. Haq, J.) has expressed in his judgment dated 28-1-2015 and 10-2-2015 that the judgment delivered by the Division Bench of this Court in Lalitkumar Shah's case, cited supra, requires reconsideration in view of the decision of the Division Bench of this Court in the case of State of Maharashtra v. Bhaskar Namdeo Wagh and others, reported in 2009(1) Mh.L.J. 299, and the decision of the Apex Court in the case of Special Land Acquisition Officer v. Karigowda and others, reported in (2010) 5 SCC 708, which were not brought to the notice of the Division Bench of this Court. The learned Single Judge has, therefore, referred the following questions of law for determination by the Larger Bench :
If the possession is taken before notification under Section 4(1) of the Act of 1894 is published and/or before the award is passed, whether the landowner would be entitled for interest as per Section 34 of the Act of 1894 from the date of publication of the notification under Section 4(1) of the Act of 1894 or from the date of passing of the award?
In order to decide this reference, the entire scheme of the Land Acquisition Act, 1894 (hereinafter referred to as "the said Act) will have to be seen.
6. The Land Acquisition Act is a complete Code as has been rightly urged by Smt. Bharti Dangre, the learned Government Pleader, making the provisions for acquiring title over the land, taking possession thereof and for payment of compensation to the land owners. The proceedings for acquisition of land commence from the date of publication of preliminary notification under Section 4(1) of the said Act, which provides that whenever it appears to the appropriate Government that the land in any locality is needed or is likely to be needed for any purpose or for a company, a notification to that effect shall be published in the Official Gazette and in two daily newspapers circulating in that locality and the Collector shall cause public notice of the substance of such notification to be given at convenient places in the said locality. Sub-section (2) provides that, thereupon it shall be lawful for any officer, either, generally or specially, authorized by such Government in this behalf, and for his servants and workmen, to enter upon and survey and take levels of any land in such locality; to dig or bore in the subsoil; to do all other acts necessary to ascertain whether the land is adapted for such purpose etc.
7. After inviting objections and granting hearing over the proposed acquisition as contemplated by Section 5A of the said Act, if the Government is satisfied that the land is needed for public purposes or for a company, it can make a declaration to that effect under Section 6 of the said Act to be published in the Official Gazette and two daily newspapers and the public notice of the substance of such declaration has to be given in the locality. Thereafter, the Collector is required to issue notice under Section 9(1) of the said Act to the persons interested, stating that the Government intends to take possession of the land, and that claims to compensation for all interests in such land may be made to him. Section 11 provides for making an award by the Collector of the compensation which should be allowed for the land.
8. Section 16 provides that where the Collector has made an award under Section 11, he may take possession of the land, which shall thereupon vest absolutely in the Government free from all encumbrances. Section 17 provides that in cases of urgency, whenever the appropriate Government so directs, the Collector, though no such award has been made, may, on the expiry of 15 days from the publication of notice mentioned in Section 9(1), take possession of any land needed for a public purpose and such land shall thereupon vest absolutely in the Government, free from all encumbrances. In view of sub-section (3A) of Section 17, the Collector has to tender 80% of the estimated amount of compensation to the persons interested/entitled thereto, before taking over the possession.
9. Section 34 of the said Act with which the present matter is concerned, deals with the payment of interest and the same is reproduced below :
"34. Payment of interest. When the amount of such compensation is not paid or deposited on or before taking possession of the land, the Collector shall pay the amount awarded with interest thereon at the rate of nine per centum per annum from the time of so taking possession until it shall have been so paid or deposited:
Provided that if such compensation or any part thereof is not paid or deposited within a period of one year from the date on which possession is taken, interest at the rate of fifteen per centum per annum shall be payable from the date of expiry of the said period of one year on the amount of compensation or part thereof which has not been paid or deposited before the date of such expiry."
The aforesaid provision contemplates that when the amount of such compensation is not paid or deposited on or before taking possession of the land, the Collector shall pay the amount awarded with interest thereon at the rate of nine per centum per annum from the time of so taking possession until it shall have been so paid or deposited. In terms of proviso, if the amount is not paid or deposited within a period of one year from the date on which the possession is taken, the interest at the rate of fifteen per centum per annum shall be payable from the date of expiry of the said period of one year on the amount of compensation or part thereof which has not been paid or deposited before the date of such expiry.
10. The right to acquire, hold and dispose of the property has ceased to be a fundamental right under the Constitution of India, but it continues to be a legal or constitutional right, viz. that no person can be deprived of his property save and except by and in accordance with law. Article 300A as well as Article 31A of the Constitution of India contain a power of eminent domain to appropriate the private property, which should satisfy two tests -
(i) the acquisition is for public purpose, and (ii) the payment of adequate compensation, which should not be less than the market value of the land. The Legislature can deprive a person of his property only in the manner and authority provided by law.
11. The Land Acquisition Act, 1894 is a piece of Central Legislation enacted to exercise the power of eminent domain to compulsorily acquire the land by extinguishing the rights therein of the persons or the owners. Except the provision of Section 17 of the said Act, the land proposed to be acquired under the provisions of the Land Acquisition Act stands vested in the Government free from all encumbrances only upon taking possession in the manner provided under Sections 16 of the said Act. In terms of Section 16, the possession of the land can be taken only upon making of an award under Section 11 of the said Act. The amount determined as compensation becomes due and payable upon making of an award and entitlement to take possession becomes co-terminus with the deposit or payment of compensation. Without making such award, possession cannot be taken.
12. Under Section 17 of the urgency clause, it is not necessary to wait for making of an award under Section 11 of the said Act to take possession of the land, but the essential conditions for taking possession of the land are that -
(i) the notice mentioned under Section 9(1) is given, (ii) the period of fifteen days from the date of publication of such notice has expired, (iii) at the time of taking possession, offer of payment of compensation is given to the persons for the standing crops and trees (if any) on such land and for other damages sustained by them because of sudden dispossession, and (iv) before taking possession of land, tender payment of eighty per centum of the compensation for such land, as estimated by him to the persons entitled thereto in terms of clause (a) of subs-section (3A) of Section 17 of the said Act. It is only upon fulfillment of such conditions, if the possession is taken, the title of the land stands vested in the Government free from all encumbrances. In terms of Section 17 also, the eighty per centum of the compensation becomes due and payable before taking possession and the entitlement to take possession becomes co-terminus with the tendering of compensation determined under clause (a) of sub-section (3A) therein.
13. Taking over the possession of the land by the Collector, is the necessary ingredient or an instance of vesting of title in the Government under the provisions of the said Act and it is, therefore, of a great significance. The proceedings commenced for acquisition of land upon issuing notification under Section 4(1) of the said Act can be dropped in terms of Section 48 therein, before the land vests in the Government. Once the land vests in the Government, it is not even possible to withdraw it from acquisition. For vesting of title, the manner of taking possession has to be strictly adhered to. The concept of deemed vesting of land in the Government as has been canvassed by S/Shri Agnihotri and Thakre, the learned counsel for the claimants, cannot be imported upon publication of notification under Section 4(1) of the said Act, if the possession of the land taken by the Collector dehors the provisions of the Act, continues with him upon issuance of such notification. The possession taken over in the acquisition proceedings dehors the provisions of the Act will not confer or vest the title over it in the Government merely because notification under Section 4(1) of the said Act is issued and the proceedings for acquisition of the land have commenced.
14. Perusal of Section 34 of the said Act reveals that the condition precedent for attracting the liability to pay interest is non payment or non deposit of the amount of compensation for the land acquired on or before taking possession of the land. There may be a situation where possession is taken but the compensation determined under Section 11 or in terms of clause (a) of sub-section (3A) of Section 17 of the said Act is not paid or deposited or it is belatedly paid or deposited. To take care of such situation, the provision of Section 34 has been introduced for the benefit of the owner of the land. It operates from the date on which the amount of compensation becomes due and payable on the date of passing of an award under Section 11 or in terms of clause (a) of sub-section (3A) of Section 17 of the said Act before taking possession. It continues to operate if the possession is taken under Section 16 or 17 of the said Act till the deposit or payment of the entire amount as determined under Section 11 of the said Act. This is the period covered by the interest payable. It is an amount which is statutorily required to be paid at the specified rates in addition to the amount of compensation which becomes due and payable on the date of making of an award under Section 11 or before taking possession of the land under Section 17 of the said Act. Except Section 34, there is no other provision in the said Act, to cover the aspect of payment of interest for such period.
15. In the decision of the Apex Court in case of Dr. Shyamlal Narula vrs. The Commissioner of Income Tax reported in AIR 1964 SC 1878, the question considered was whether interest paid under Section 34 of Land Acquisition Act, 1894, is of the nature of a capital receipt or of a revenue receipt. After quoting Section 34 of the said Act, the Apex Court holds that the interest shall be paid on the amount awarded, from the time the Collector takes possession until the amount is paid or deposited. It holds that the interest pertains to the domain of payment after the compensation has been ascertained and it is a consideration paid either for the use of money or for forbearance from demanding it after it has fallen due. In para 9 of the said decision, it is held that the interest payable under Section 34 is not the compensation paid to the owner for depriving him of his right to possession of the land acquired, but that given to him for deprivation of the use of the money representing the compensation of the land acquired. In para 10, the Apex Court holds that as soon as the Collector has taken possession of the land either before or after the award, the title absolutely vests in the Government and thereafter the owner of the land so acquired, ceases to have any title or right of possession to the land acquired. It holds that under the award, the owner gets compensation for both the rights and therefore, the interest awarded under Section 28 of the Act, just like under Section 34 thereof, cannot be a compensation or damages for the loss of the right to retain possession, but only compensation payable by the State for keeping back the amount payable to the owner. It is thus the amount payable under Section 34 of the said Act represents the consideration payable on account of not tendering or depositing the compensation which has become payable to the owner before taking possession of the land. 16. On the basis of the Division Bench judgment of this Court in Bhaskar Wagh's case and the decision of the Apex Court in Karigowda's case, cited supra, it is urged by the learned counsel for the respondent-claimant that the respondent-claimant would be entitled to interest as per Section 34 of the Land Acquisition Act from the date of publication of notification under Section 4(1), once it is found that the possession of the land was taken prior to issuance of the notification under Section 4 of the said Act. Both the decisions relied upon by the respondent-claimant, refer to and rely upon the decision of the Three-Judge Bench of the Apex Court in R.L. Jain's case, cited supra. Hence, the basic question is about the ratio laid down by the Apex Court in R.L. Jain's case. Therefore, the facts of that case will have to be understood along with the principles of law laid down in the said decision.
17. In the decision of the Apex Court in R.L. Jain's case, cited supra, the question considered was whether in a case where possession is taken prior to issuance of notification under Section 4(1) of the said Act, the claimant (owner of the land) is entitled to interest for such anterior period in accordance with Section 34 of the said Act. The facts of the said decision need to be seen. Initially on 13-11-1959, the notification under Section 4(1) of the Land Acquisition Act was issued. After issuance of such notification, appellant R. L. Jain purchased the land in auction on 8-4-1960. The sale certificate was issued in his favour on 31-8-1961. On 11-10-1961, the possession was taken over by the State Authorities pursuance to the notification under Section 6 of the Land Acquisition Act. The award was passed on 30-12-1961 and the claimant received the amount of compensation under protest. In Suit No.154 of 1965 filed by the claimant, the proceedings for acquisition of land were set aside on 12-4-1967. The High Court dismissed the appeal on 14-8-1991, and during the pendency of the Special Leave to Appeal before the Apex Court, a fresh notification was issued under Section 4(1) of the said Act on 9-9-1992. The notification under Section 6 of the said Act was issued on 8-9-1993, and the award was passed on 11-6-1994. In this background, the question involved was whether the claimant was entitled to interest under Section 34 of the said Act from the date of taking over possession of the land on 11-10-1961 or passing of the award on 11-6-1994.
18. The Apex Court has held in R.L. Jain's case that the scheme of the Act does not contemplate taking over of possession prior to the issuance of notification under Section 4(1) of the Act and if possession is taken prior to the said notification, it will be dehors the Act. For this reason, it is held that both Sections 11(1) and 23(1) enjoin the determination of the market value of the land on the date of publication of notification under Section 4(1) of the Act for the purpose of determining the amount of compensation to be awarded for the land acquired under the Act. It holds that these provisions show in unmistakable terms that publication of notification under Section 4(1) is the sine qua non for any proceedings under the Act.
19. In para 12 of the decision in R.L. Jain's case, the Apex Court has made reference to the heading Acquisition of Part II of the Act and sub-heading Taking Possession , which contains Sections 16 and 17 of the Act. The Apex Court has construed the words so taking possession to mean taking possession in accordance with Section 16 or 17 of the Act. The Court has noted that these are the only two sections in the Act which specifically deal with the subject of taking possession of the acquired land. It holds that clearly, the stage for taking possession under the aforesaid provisions would be reached only after publication of the notification under Sections 4(1) and 9(1) of the Act. The Court further holds that if the possession is taken prior to the issuance of the notification under Section 4(1), it would not be in accordance with Section 16 or 17 and will be without any authority of law and consequently cannot be recognized for the purposes of the Act. It further holds that for parity of reasons, the words from the date on which he took possession of the land occurring in Section 28 of the Act would also mean lawful taking of possession in accordance with Section 16 or 17 of the Act. The words so taking possession can under no circumstances mean such dispossession of the owner of the land which has been done prior to publication of notification under Section 4(1) of the Act which is dehors the provisions of the Act.
20. Paras 18 and 19 of the said decision in R.L. Jain's case, being relevant, are also reproduced below:
18. In a case where the landowner is dispossessed prior to the issuance of preliminary notification under Section 4(1) of the Act the Government merely takes possession of the land but the title thereof continues to vest with the landowner. It is fully open for the landowner to recover the possession of his land by taking appropriate legal proceedings. He is therefore only entitled to get rent or damages for use and occupation for the period the Government retains possession of the property. Where possession is taken prior to the issuance of the preliminary notification, in our opinion, it will be just and equitable that the Collector may also determine the rent or damages for use of the property to which the landowner is entitled while determining the compensation amount payable to the landowner for the acquisition of the property. The provisions of Section 48 of the Act lend support to such a course of action. For delayed payment of such amount appropriate interest at prevailing bank rate may be awarded.
19. The case may be examined from the equitable consideration as well. In the earlier acquisition proceedings`1 the notification under Section 4(1) had been published on 13-11-1959 and the Collector had made an award for Rs.6301 for the plot in dispute on 30-12-1961. The award was made within 1 months of dispossession which allegedly took place on 10-11-1961. This amount was paid to R.L. Jain and was retained by him. Learned counsel for the respondent has placed before the Court a copy of the sale certificate issued in favour of R.L. Jain on 31-8-1961 which shows that the plot was purchased by him for Rs.3200 only and thus he had received almost double amount of compensation. Therefore, even on equitable ground he is not entitled to any amount from the date of dispossession till the date of second notification under Section 4(1) of the Act which was issued in 1992.
It is thus clearly a law laid down by the Apex Court that in case where the landowner is dispossessed of the land prior to notification under Section 4(1) of the said Act, the title thereof continues to vest with the landowner and it is open for him to recover such possession and can claim rent and damages for use and occupation for the period for which the Government has retained the possession. The Apex Court has rejected the claim for interest under Section 34 of the said Act for the period anterior to the issuance of notification under Section 4(1) of the said Act, in a case where possession was taken prior to the issuance of the notification under Section 4(1) therein.
21. In the decision of the Division Bench of this Court (M/s. Swatanter Kumar, C.J. and A.P. Deshpande, J.) in Bhaskar Wagh's case, cited supra, the possession of the land was taken on 16-7-1981, whereas the notification under Section 4 of the Land Acquisition Act was issued on 20-8-1981. The possession was taken hardly a month before issuance of the notification under Section 4 of the said Act. After referring to the decision of the Apex Court in R.L. Jain's case, cited supra, it has been held in para 5 as under:
5. ... Thus, it is clear that where the possession is taken prior to the issuance of section 4 Notification, it has been held to be just and equitable that the Collector should determine and pay the rent or damages for use of the property to the land owner. In the present case, the Collector has not paid any rent or damages for a period of about one month on account of taking of possession before issuance of section 4 Notification. As stated hereinabove, that period involved in the present case is of about one month and hence, it has hardly any impact while determining the market value. We do not propose to interfere with the Judgment and Award passed by the District Judge in relation to the payment of sum by way of interest for a period of about one month prior to the issuance of Notification under section 4(1), as in our opinion, the said amount would represent the rent and/or damages, which the claimants would be entitled to.
The Division Bench of this Court has held that the period involved in the present case is of about one month and hence, it has hardly any impact while determining the market value. The Division Bench clearly holds that we do not propose to interfere with the Judgment and Award passed by the District Judge in relation to the payment of sum by way of interest for a period of about one month prior to the issuance of notification under Section 4(1), as in our opinion, the said amount would represent the rent and/or damages, which the claimants would be entitled to.
22. In the subsequent decision of the Apex Court, delivered by the two Judges, in Karigowda's case, the decision of the Apex Court in R.L. Jain's case, cited supra, has been referred to, and it is held in para 101 as under :
101. As is evident from the above dictum of the Court, despite dispossession, the title continues to vest in the landowners and it is open for the landowners to take action in accordance with law. Once notification under Section 4(1) of the Act has been issued and the acquisition proceedings culminated into an award in terms of Section 11, then alone the land vests in the State free of any encumbrance or restriction in terms of provisions of Section 16 of the Act. The court, in situations where possessions have been taken prior to issuance of notification under Section 4(1) of the Act, can direct the Collector to examine the extent of rent or damage that the owners of land would be entitled to, the provisions of Section 48 of the Act would come to aid and the court would also be justified in issuing appropriate direction. This was the unequivocal view expressed by the Court in R.L. Jain case as well. This legal question is no more open to controversy and stands settled by this Court. We would follow the view taken and accept the contention of the appellant State that the Reference Court as well as the High Court could not have granted any interest under the provisions of the Act, for a date anterior to the issuance of notification under Section 4 of the Act. However, following the dictum of the Bench in R.L. Jain case, we direct the Collector to examine the question of payment of rent/damages to the claimants, from the period when their respective lands were submerged under the backwater of the river, till the date of issuance of the notification under Section 4(1) of the Act, from which date, they would be entitled to the statutory benefits on the enhanced compensation.
It is held by the Apex Court that the legal position is no more open to controversy in view of the decision of the Apex Court in R.L. Jain's case, cited supra, and it stands settled. Following the said decision, the Apex Court accepted the contention of the appellant-State that the Reference Court as well as the High Court could not have granted any interest under the provisions of the Act for a date anterior to the issuance of notification under Section 4 of the Act. However, following the dictum in R.L. Jain's case, the Apex Court directed the Collector to examine the question of payment of rent and damages to the claimants, from the period when their respective lands were submerged under the backwater of the river, till the date of issuance of the notification under Section 4(1) of the Act, from which date, they were held entitled to the statutory benefits on the enhanced compensation.
23. The ratio of the decision in R.L. Jain's case is clear and unambiguous in construing the words so taking possession employed under Section 16 or 17 of the said Act to mean that taking possession only in accordance with Section 16 or 17, which can only be after the issuance of the notifications under Sections 4(1) and 9(1) of the said Act. Till such possession is taken, the title thereof continues to vest in the landowner and it is open for him to claim rent and damages for use and occupation for the period from which the Government has retained the possession. Taking possession of the land under acquisition prior to the stage for taking possession under the provision of Section 16 or 17 is held to be without authority of law and cannot be recognized for the purposes of the Act. In the another decision of the Apex Court in case of Lila Ghosh vrs. State of West Bengal, reported in (2004) 9 SCC 337, it is held that it is only in case of possession under Section 17 of the said Act, the payment of interest shall start running from the date of possession.
24. In our view, the Apex Court in its decision in R.L. Jain's case, cited supra, did not consider the question as to whether the interest under Section 34 of the said Act can be awarded from the date of notification under Section 4(1) of the said Act, in a case where the possession of the land under acquisition was taken under the private agreement or otherwise, prior to the issuance of notification under Section 4(1) of the said Act. Similarly, neither the decision of the Division Bench of this Court in Bhaskar Wagh's case, nor the decision of the Apex Court in Karigowda's case, cited supra, lay down the ratio that if the possession is taken before the notification under Section 4(1) of the Land Acquisition Act is published and/or before the award is passed, the landowner would be entitled to interest as per Section 34 of the said Act, from the date of publication of the notification under Section 4(1) of the said Act. In none of these decisions, such question was raised and decided. Before us, the position of law that if the possession is taken after an award is made under Section 11, then the interest under Section 34 of the said Act shall start running from the date of award is not disputed and this is the position of law explained by the Division Bench of this Court in State of Maharashtra v. Rajendra reported in 2008 (1) BCR 839, with which we agree.
25. In Karigowda's case, cited supra, the Apex Court directed the Collector to examine the question of payment of rent/damages to the claimants from the period when their respective lands were submerged under the backwater of the river, till the date of issuance of the notification under Section 4(1) of the said Act. In the decision of the Division Bench of this Court in Bhaskar Wagh's case, the Court has avoided to adjudicate the question of payment of interest for the period prior to the date of issuance of notification, where the possession was already taken over, for the reason that it was only a short period of one month, and instead of interest, the amount would represent the rent and/or damages. In view of this, as has been rightly urged by Mrs.Bharti Dangre, the learned Government Pleader, we do not find that these decisions even if had been considered, would have had any impact on the decision of the Division Bench of this Court in Lalitkumar Shah's case, cited supra, which holds, in the circumstances, that the interest in terms of Section 34 of the said Act shall be payable from the date of award.
26. No doubt, in Karigowda's case, the Two-Judge Bench of the Apex Court, after expressing its full agreement with the ratio of the decision in R.L. Jain's case, has directed the Collector to examine the question of payment of rent/damages to the claimants, and it is held that from the date of the notification under Section 4(1) of the said Act, the claimants would be entitled to the statutory benefits on the enhanced compensation. Shri Thakre and Shri Agnihotri arguing for the claimants have placed heavy reliance on this observation to urge that the interest under Section 34 is the statutory benefit which is payable on the enhanced compensation.
27. In our view, the aforesaid direction of the Apex Court cannot be construed to include the amount of interest payable under Section 34 of the said Act. As has been held by the Apex Court in the decision in the case of Dr. Shamlal Narula, the interest payable under Section 34 is not the compensation paid to the owner for depriving him of his right to possession of the land, but that is given to him for deprivation of the use of money representing the compensation of the land acquired. It is payable where possession is taken but the compensation determined under Section 11 or in terms of clause (a) of sub-section (3A) of Section 17 of the said Act, has not been paid or deposited on the date when it became due and payable. It is not payable on account of enhancement of compensation which is covered by Section 28 of the said Act.
28. The learned counsels appearing for the claimants have relied upon Section 23(1A) of the said Act, which is reproduced below:
23. Matters to be considered in determining compensation.
(1A) In addition to the market value of the land, as above provided, the Court shall in every case award an amount calculated at the rate of twelve per centum per annum on such market value for the period commencing on and from the date of the publication of the notification under section 4, sub-section (1), in respect of such land to the date of the award of the Collector or the date of taking possession of the land, whichever is earlier.
Explanation. In computing the period referred to in this subsection, any period or periods during which the proceedings for the acquisition of the land were held up on account of any stay or injunction by the order of any Court shall be excluded.
It is urged that the aforesaid provision deals with the additional component to be calculated at the rate of twelve per centum per annum of the market value of the land for the period commencing on and from the date of the publication of the notification under Section 4, sub-section (1), in respect of such land to the date of award of the Collector or the date of taking possession of the land, whichever is earlier. It is further urged that Section 34 of the said Act, which deals with the payment of interest covers the same area, which is covered by the provision of sub-section (1A) of Section 23, reproduced above.
29. In terms of the decision of the Apex Court in the case of Siddappa Vasappa Kuri and another v. Special Land Acquisition Officer and another, reported in AIR 2001 SC 2951, it is held that the starting point for the purposes of calculating the amount of additional compensation under Section 23(1A) of the said Act at the rate of twelve per centum per annum on the market value of the land is the date of publication of Section 4 notification. The terminal point for the purpose is either the date of the award or the date of taking possession, whichever is earlier. The interest payable under Section 34 of the said Act is in the case where the possession is taken under Section 17 of the said Act, but the compensation determined under clause (a) of sub-section (3A) of Section 17 or under Section 11 of the said Act has not been paid or deposited on the date when it became due and payable. As such, Section 34 of the said Act operates only from the date on which the compensation determined becomes due and payable. As against this, the additional component under Section 23(1A) becomes payable on the date of publication of the notification under Section 4(1) of the said Act, or from the date of taking possession of the land, whichever event occurs earlier.
30. In view of above, there is no question of overlapping the benefits available to the claimants under Section 23(1A) or Section 34 of the said Act. The terminal point under Section 23(1A) is either the date of the award or taking of possession, whereas the starting point of interest under Section 34 of the said Act is the passing of the award or taking of possession; both terminating on the date of payment or deposit in Court pursuant to the award passed under Section 11 of the said Act.
31. If the landowner is divested the possession of his land by the Collector or the State Government illegally or de hors the provisions of the said Act, it is open for him to recover such possession and claim rent and damages for the use and occupation for the period for which the State Government has illegally retained the possession of the land. To take care of such situation, certain administrative circulars have been issued by the State Government for payment of rental compensation, in accordance with which the claimants are paid for the period for which they are deprived of the benefits of the land till the notification is published under Section 4(1) of the said Act. We are not concerned in this matter about the rental compensation or the damages to which the claimants are entitled, if the possession of the land is de hors the provisions of the Act.
32. Keeping in view the entire scheme of the Land Acquisition Act and the ratio of the decisions of the Apex Court in the cases of R.L. Jain and Lila Ghosh, cited supra, the position of law can be summarized as under :
(i) If the possession of the land under acquisition is taken under Section 16 of the said Act i.e. after an award is made by the Collector under Section 11 therein, the interest would be payable under Section 34 from the date of passing of the award and we are in agreement with such a view expressed by the Division Bench of this Court (S/Shri N.V.. Dabholkar and M.G. Gaikwad, JJ.) in the case of State of Maharashtra and anr. v. Rajendra Narayanrao Gaikwad, reported in 2008 (1) BCR 839.
(ii) The interest as provided under Section 34 of the said Act shall start running from the date of possession, only if the possession is taken by the Collector in exercise of his powers under Section 17 of the said Act which would obviously be after issuance of notice under Section 9(1) of the said Act. If the possession is taken under Section 17, the interest payable under Section 34 of the said Act shall start running from the date of possession and not from the date of award.
(iii) Where the possession of the land under acquisition is taken prior to issuance of notification under Section 4(1), then there would be no question of invoking the urgency clause under Section 17 of the said Act and the interest under Section 34 shall start running from the date of passing of the award.
(iv) The starting point for the purposes of calculating the amount of additional component under Section 23(1A) of the said Act at the rate of twelve per centum per annum is the date of publication of the notification under Section 4 of the said Act, and the terminal point is either the date of the award or the date of taking possession, whichever is earlier.
(v) We hold that in none of the eventualities, the claimant shall be entitled to interest under Section 34 of the said Act from the date of publication of the notification under Section 4(1) of the said Act.
(vi) There is no overlapping of the benefits under Section 23(1A) and Section 34 of the said Act. The terminal points under Section 23(1A) are the starting points under Section 34 of the said Act and both the provisions operate in different fields.
(vii) We express our full agreement with the view taken by the Division Bench of this Court in Lalitkumar Shah's case, cited supra, that in a case where possession is taken prior to issuance of notification under Section 4(1) of the said Act, the interest under Section 34 shall start running from the date of award only.
(viii) We also express our full agreement with the view taken by the Division Bench of this Court in Lalitkumar Shah's case, cited supra, that the decision of the Division Bench in the case of Jafarali Mithabhai Hirani and Ors. v. State of Maharashtra and Ors., reported in 2009 (3) All MR 779, and the similar view taken in other matters is no longer a good law.
33. In view of above, we answer the question of reference as under:
(a) If the possession is taken before the notification under Section 4(1) of the Land Acquisition Act is published and/or before the award is passed, the landowner would be entitled for interest as per Section 34 necessarily from the date of passing of the award under Section 11 of the said Act, except in cases where the possession is taken in accordance with Section 17 of the said Act, and in that situation only, the provision of Section 34 of the said Act shall start operating from the date of possession.
(b) We also hold that the decision of the Division Bench of this Court in the case of Lalitkumar Himmatlal Shah v. State of Maharashtra and others, decided by Smt. Vasanti A. Naik and Shri Prasanna B. Varale, JJ., and reported in 2012(4) Mh.L.J. 742, lays down a correct position of law and it does not require reconsideration.
34. In view of above, the Office to place the matter before the learned Single Judge for decision in accordance with the answer to the question given as above.