The Awardee would be Entitled to Claim Interest on Solatium in Execution: SC

Tamil Nadu Housing Board v. Abdul Salam Sarkar (Dead) and Others

Civil Appeal No 94 of 2021 (Arising out of SLP © No 16857 of 2019)

13 January 2021

The Constitutional Bench of Hon’ble Supreme Court consisting of Justice Dr. Dhananjaya Y Chandrachud and Justice Sanjiv Khanna disposed the appeal by clarifying that the interest on solatium will be payable with effect from the date of judgment in Sunder vs. Union of India (19 September 2001) and disbursing the amount of Rs 5 lakhs to the claimants which the appellant has deposited during the pendency of the proceedings.

In the present appeal, the question in front of the court is to examine whether the respondent is entitled to the interest in solatium for the execution under the Land Acquisition Act 1894 and to identify this problem, the court has to refer to the judgment pronounced in Gurpreet Singh vs. Union of India.

To reach a conclusion, the court referred to the Gurpreet Singh judgment and found that the issue was considered specifically in the earlier judgment in Sunder vs. Union of India. And in this, the court found that:

IF, therefore, the claim for interest on solatium had been made and the same has been negatived either expressly or by necessary implication by the judgment or decree of the Reference Court or of the appellate court, the execution court will have necessarily to reject the claim for interest on solatium based on Sunder [(2001) 7 SCC 211 : 2001 Supp (3) SCR 176] on the ground that the execution court cannot go behind the decree. But if the award of the Reference Court or that of the appellate court does not specifically refer to the question of interest on solatium or in cases where claim had not been made and rejected either expressly or impliedly by the Reference Court or the appellate court, and merely interest on compensation is awarded, then it would be open to the execution court to apply the ratio of Sunder [(2001) 7 SCC 211 : 2001 Supp (3) SCR 176] and say that the compensation awarded includes solatium and in such an event interest on the amount could be directed to be deposited in execution. Otherwise, not. We also clarify that such interest on solatium can be claimed only in pending executions and not in closed executions and the execution court will be entitled to permit its recovery. (Para 54 of Gurpreet Singh vs. Union of India)

Hence, the claimants were entitled to apply for the grant of interest on solatium on the condition that the claim had not been rejected at any antecedent stage and had been kept open.

Concluding, the Court held:

In terms of the judgment of the Constitution Bench in Gurpreet Singh (supra), interest on solatium will be payable with effect from the date of the judgment in Sunder vs Union of India (19 September 2001). (Para 10)

Subsequently the appeal disposed of.

View/Download Judgment: Tamil Nadu Housing Board v. Abdul Salam Sarkar (Dead) and Others

Swadheen Singh