The Punjab and Haryana High Court has held that landowners whose properties are acquired for national highway projects cannot be denied the enhanced interest benefits available under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.
Justice Harkesh Manuja observed that compensation under land acquisition laws includes not only the market value and solatium but also interest payable for delay in payment. The Court said denying such benefits to landowners affected by National Highways Act acquisitions would amount to discrimination.
Background of the Case
The case arose from acquisition of land belonging to Kuldeep Singh and another in Village Tibber, Gurdaspur, Punjab, for the Delhi-Amritsar-Katra National Highway project. The acquisition proceedings were initiated under the National Highways Act, 1956.
Initially, the Competent Authority for Land Acquisition (CALA) fixed compensation at Rs. 5,363 per marla. Dissatisfied with the valuation, the landowners sought arbitration under Section 3G(5) of the National Highways Act.
The Arbitrator later enhanced the compensation to Rs. 15 lakh per acre along with 100% solatium and 12% additional interest from the notification date till the original award. However, the Arbitrator granted only 9% interest from the date of filing of the application till deposit of the amount.
What Happened During the Hearing
The petitioners argued that under Section 72 of the 2013 Act, they were entitled to interest at 9% for the first year from the date of possession and 15% per annum thereafter until actual payment.
They relied on the Supreme Court ruling in Union of India v. Tarsem Singh, where the apex court held that landowners under the National Highways Act cannot be discriminated against in matters of compensation, solatium, and interest.
On the other hand, the respondents contended that the petitioners had an alternative remedy under Section 34 of the Arbitration and Conciliation Act and therefore the writ petition was not maintainable.
Court’s Key Observation
The High Court held that interest forms an integral component of “just compensation” under land acquisition law.
The Court observed:
“The just compensation would not only include the compensation which has been determined, but also solatium and interest payable thereof on the delay in making payment of compensation.”
Justice Manuja further noted that citizens whose lands are acquired under different enactments cannot be treated unequally regarding compensation and interest.
The Court also referred to the 2015 Central Government notification extending beneficial compensation provisions of the 2013 Act to acquisitions under laws listed in the Fourth Schedule, including the National Highways Act.
Allowing the petition, the High Court held that the Arbitrator had erred in restricting the interest component.
The Court held that the petitioners were entitled to the benefit of interest under Section 72 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, namely 9% interest for the first year from the date of possession and 15% per annum thereafter on the enhanced compensation amount till actual payment.
The writ petition was accordingly disposed of with these directions.
Case Details
Case Title: Kuldeep Singh and Another v. Union of India and Others
Case Number: CWP No. 38070 of 2025 (O&M)
Court: Punjab and Haryana High Court
Judge: Justice Harkesh Manuja
Date: April 23, 2026
