Solatium and interest for land acquired under national highways act to be computed basis date of competent authority’s award: Supreme court

Supreme Court Ruling: Solatium and interest for land acquired under the National Highways Act to be calculated from the date of the competent authority's award.

Case Name: Manav Bhanot v. National Highway Authority of India

Coram: Justices J.B. Pardiwala and K. Vinod Chandran

Citation: (2026) ibclaw.in 628 SC | Civil Appeal No. 12587 of 2026 | Decided on 08.09.2026

The Supreme Court has held that solatium, interest, and interest on solatium payable for land acquired under the National Highways Act, 1956 (NH Act) must be computed with reference to whether the Competent Authority’s determination of compensation was made before or after 01.01.2015, the date on which the compensation provisions of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (2013 Act) were made applicable to acquisitions under the NH Act. Background

The only issue before the Court was whether solatium, interest, and interest on solatium for land acquired under the NH Act were to be computed under the Land Acquisition Act, 1894 (1894 Act) or the 2013 Act. The appellant relied on Union of India v. Tarsem Singh (Tarsem Singh-II), contending that since there could be no differentiation in the benefit of solatium and interest between landowners whose land was acquired a day apart, straddling 01.01.2015, he was entitled to the full benefits under the 2013 Act. He also argued that since the Arbitrator’s award in his case was passed on 17.05.2017, after 01.01.2015, the 2013 Act would apply on this ground as well. The NHAI contended that the Competent Authority’s determination in this case was made on 11.07.2014, before the 2013 Act was extended to NH Act acquisitions, and that solatium and interest must therefore be computed under the 1894 Act, relying on National Highways Authority of India v. Tarsem Singh (Tarsem Singh-III).

Findings

The Court traced the legislative history of Section 3J of the NH Act, inserted in 1997 to exclude the applicability of the 1894 Act to highway acquisitions, and its invalidation in Union of India v. Tarsem Singh (Tarsem Singh-I) as violative of Article 14 of the Constitution. It noted that Section 105 of the 2013 Act excluded enactments listed in the Fourth Schedule, including the NH Act, from its operation for one year, and that this exclusion was subsequently extended, with the 2013 Act’s compensation provisions made applicable to NH Act acquisitions only with effect from 01.01.2015, by notification.

Relying on the Constitution Bench decision in Indore Development Authority v. Manoharlal and Others, the Court held that the applicability of the 2013 Act turns on whether the “award” was made before or after the relevant date. Under the NH Act, the determination of compensation by the Competent Authority under Section 3G is equivalent to the award under Section 11 of the 1894 Act. Therefore, if the Competent Authority’s determination is made before 01.01.2015, solatium, interest, and interest on solatium are to be computed under the 1894 Act; if made after that date, the 2013 Act would apply, even where the acquisition proceedings had commenced earlier.

The Court clarified that Tarsem Singh-II had only held that the benefit of solatium and interest cannot be denied to landowners merely because their land was acquired before 01.01.2015, and had not laid down that the rate of computation for pre-2015 awards must follow the 2013 Act.

Applying this to the facts, the Court noted that the Competent Authority had determined compensation on 11.07.2014, prior to the Ordinance and notification extending the 2013 Act to NH Act acquisitions. The Court also rejected the appellant’s reliance on a Ministry notification referring to unpaid “land holdings” as of 31.12.2014, noting that the notification referred to land holdings and not landowners, and that NHAI had shown compensation for the majority of the land in question had already been paid in 2014.

The appeal was accordingly allowed only to the extent of directing that the compensation determined by the Arbitral Award be conferred with solatium, interest, and interest on solatium as provided under the 1894 Act, and the matter was remanded to the Competent Authority for computation and disbursal.