The Supreme Court has dismissed the claim of a large number of Karnataka farmers for payment of interest on enhanced compensation, awarded to them by the state high court.
Setting aside the HC order, a bench of Justices Aftab Alam and Swatanter Kumar, citing earlier judgments of the top court, said no interest could be paid on “solatium” as the interest would only be claimed on the original compensation award.
The hight court order directing the state government to pay interest on the enhanced award was challenged in the top court by state’s land acquisition officer. The top court agreed with Karnataka’s counsel Sanjay Hegde that where full payments of award had been made in terms of the decree and the execution proceedings were consequently closed, the proceedings for claiming interest on enhanced payment could not be reopened.
The government had taken the land of the farmers in various places in August 1989 when the award was fixed at Rs 20,000 per acre. But the civil court had enhanced it by 30 per cent with 12 per cent additional market value and 9 per cent interest on it from the first year and 15 per cent from the second year.
The Karnataka HC had enhanced it further to Rs 78,00 per acre. But the apex court said that the HC decision was “untenable” and therefore, it was set aside.