First Appeal No.832 of 1990

28th November, 1996

Petitioner Counsel: Mr. R. S. DESHPANDE, AGP
Respondent Counsel: Mr. P. K. DHAKEPHALKAR with Mr. VIJAY PATIL

Cases Cited:
AIR 1991 SC 454 [Para 11]
AIR SCW 3029 [Para 12]
AIR 1971 SC 454 [Para 13]
AIR 1962 SC 316 [Para 13]
AIR 1995 SC 2181 [Para 18]

JUDGMENT

M. L. DUDHAT, J. :- This appeal is preferred by the Government against the judgment and decree dated 25th of April 1990 passed by the Extra Joint District Judge, Pune in Land Reference No.75 of 1981.

2. The land in question is about 27 acres, 32 gunthas and 8 annas situated at Bhosari, Pune. A notice was issued under Section 32(2) of Maharashtra Industrial Development Act, 1961 (hereinafter for the sake of brevity referred to as the "M.I.D.C. Act") on 27th May 1968 for acquiring the aforesaid land and, therefore, one has to consider the valuation of the land on 27.5.1968. During acquisition proceedings, the Acquisition Authority, after hearing both the sides, passed an award granting compensation of Rs.9,700/- per acre. Against the aforesaid award passed by the Land Acquisition Officer, the present respondents-claimants have filed a reference under Section 34 of the M.I.D.C. Act read with Section 18 of the Land Acquisition Act for enhancement of compensation before the Extra Joint District Judge, Pune, being Land Reference No.75 of 1981. The trial Court after allowing both the sides to lead evidence, allowed the reference and awarded compensation at the rate of Rs.79,110 per acre i.e. the amount of Rs.25,15,041/- for the land admeasuring about 27 acres, 32 gunthas and 8 annas. The trial Court also awarded interest at the rate of 9% per annum from 30th August 1969 to 29th August 1970 and from the period 30th August 1970 till the actual payment at the rate of 15% per annum. The aforesaid award passed by the trial Court is challenged by the appellant.

3. Mr. Deshpande, learned counsel appearing on behalf of the appellant, mainly confined his arguments on two points. Firstly, he contended that the appellant has led evidence of comparable sale instances on the basis of which the Land Acquisition Officer awarded compensation at the rate of Rs.9,600 per acre. He further contended that the trial Court ought not to have taken into consideration various awards viz. Exhibits 56 to 60 while enhancing the compensation. Secondly, he contended that the trial Court ought not to have taken into consideration Exhibit 147 which is the report dated 19th August 1972 given by the Executive Engineer of Building & Communication Department. On the other hand, Mr. Dhakephalkar, learned counsel appearing on behalf of the respondents, contended that the trial Court was right in discarding the evidence led by the appellant of comparable sale instances as the sale instances were that of agricultural lands while the land in question is admittedly a quarry. Secondly, he contended that in fact in the acquisition of adjoining lands in the awards which are at Exhibits 56 to 60 the nearby claimants who were the owners of the quarries, received the compensation on the basis of the report given by the Executive Engineer of Building & Communication Department. He further contended that in the present proceedings also the Land Acquisition Officer sought report of the said Executive Engineer for fixation of compensation and as per the said report, the executive Engineer fixed the compensation of the land in question at the rate of Rs.79,110 per acre. However, though in other five awards, the reports given by the said Executive Engineer were accepted and the award was passed in pursuance of the said reports, in the present case, the said reports were suppressed and without prejudice to the said reports, the Land Acquisition Officer granted compensation with reference to comparable sale instances which were those of adjoining agricultural lands.

4. In this matter, it is an admitted position that the land acquired in question was a quarry and not agricultural land. In view of this, comparable sale instances as relied upon by the appellant of agricultural lands are of no consequence and, therefore, the trial Court has rightly discarded the said sale instances.

5. There is a stone quarry of the quality Baslat rock. In the acquisition of quarries of the surrounding lands, the claimants were awarded compensation on the basis of the report of the Executive Engineer, Building & Communication Department as per the Government policy and on the basis of the said report, awards were passed in favour of the respective claimants. Those awards are exhibited as Exhibits 56 to 60. Since the said awards referred to acquisition of quarry and the said five lands are adjoining the land in question, according to our opinion, the trial Court was right in considering the valuation of the land in question on the basis of the said awards which are at Exhibits 56 to 60.

6. In the present case, it is clear from the record that during the acquisition proceedings the Land Acquisition Officer called for the report and as per the said directions, the Executive Engineer, Building & Communication Department, submitted the report of valuation of the land in question as is done in the case of other quarries referred to in the awards at Exhibits 56 to 60. However, the said report given by the Executive Engineer dated 19-8-1972 was suppressed by the Land Acquisition Officer and without referring to the same, he passed the award on the basis of comparable sale instances of agricultural lands.

7. In order to support the aforesaid contentions, the respondents-claimants had to make herculean efforts to bring the report, Exhibit 147, dated 19.8.1972 of the Executive Engineer, Building & Communication Department. From the record, it appears that before the Court, an application was made by the respondents-claimants calling upon them to produce the copy of the said report in the Court. The aforesaid application was resisted by the District Government Pleader on the ground that the said report being a confidential document, the State claimed privilege not to produce it. It was also contended on behalf of the Government that the file containing the said report was missing and, therefore, it was not possible for the State to produce the said report and other incidental documents. Therefore, the claimants produced the true copy of the report of the Executive Engineer, Building & Communication Department, regarding the valuation through P.W.4 - Sanjiv Vijaykumar Patankar, Clerk from the office of the Executive Engineer, Building & Communication Department, Pune. The said P.W.4 - Patankar stated in his evidence that Smt. Usha Kulkarni was serving as First Clerk in the office of Executive Engineer, Building & Communication Department and the said Smt. Usha Kulkarni died about 3/4 years back from the date of his deposition. He identified her signature on the copy of the valuation report of the Executive Engineer, Building & Communication Department, Pune, and stated that the original report was despatched to the Land Acquisition Officer as per his directions. Therefore, the report produced by this witness dated 19.8.1972 was exhibited as Exhibit 147. As per the said report, the Executive Engineer, Building & Communication Department, fixed the compensation of the land in question at the rate of Rs.79,110 per acre. The respondents-claimants also examined P.W.3-Subhash B. Polkam, the Mining Officer who in his deposition stated that he has been working as a Senior Geologist in the Department since 1989. He further stated that he had worked as Geological Assistant in the said Department at Pune for six years, particularly during 1969. He also stated that he produced copies of the letter dated 25th August 1972, Exhibit 146, report of the Executive Engineer for determining the valuation dated September 1972 addressed by him to the Collector, Exhibit 147, report of Geological Survey, Exhibit 148, report dated 2nd January 1973 by him to the Collector, Exhibit 149 and the statements, Exhibits 150, 151, 152 and other two letters addressed to the Collector, Pune by the Director of Geology vide Exhibits 153 and 154. The letter dated 19th August 1972 from the Executive Engineer, Building & Communication Department, Pune, states that in pursuance of the directions, he visited the lands and the lands at Bhosari are quarry lands. He further advised to refer the case to the Geologist's opinion about the quality of the stone. Further, the letter, Exhibit 146, clearly states that the lands were quarry lands and, therefore, the Executive Engineer gave detailed valuation report stating therein that the valuation is of Rs.79,110/- per acre. From the evidence led by the respondents-claimants they have proved that in fact the Land Acquisition Officer called for the report of the Executive Engineer, Building & Communication Department and as per his directions, the said report, copy of which is at Exhibit 147, was received by the Land Acquisition Officer. But subsequently the aforesaid report was suppressed and given go-by and the Land Acquisition Officer in his award never referred to this report. It is pertinent to note that during the course of acquisition along with this land, five other lands were also acquired by the appellant and in respect of the said lands, awards which are at Exhibits 56 to 60 were passed. In respect of the said five lands also, the Land Acquisition Officer called upon the Executive Engineer, Building & Communication Department, to submit his report for valuation as in the present case and accordingly, the said Executive Engineer submitted the valuation report in the said reference. In all the five said reference, the Land Acquisition Officer accepted the said report and on the basis of the said report, passed the awards, Exhibits 56 to 60, in favour of respective claimants. Surprisingly, however, in respect of the land under acquisition, in the present appeal, an attempt was made to give go-by to the valuation report of the Executive Engineer by suppressing it. When the application was made by the respondents-claimants to the trial Court calling upon the present appellant to produce the said report as pointed out aforesaid, the appellant took various objections and somehow or the other, avoided to produce the said report. Ultimately, the copy of the said report was produced with all the correspondence by calling upon the Clerk from the Building & Communication Department and this is how the said report, Exhibit 147, is on record.

8. After production of the said report and all other document from the file, the appellant has made no attempt to show as to why the said report was not accepted. Apart from that, there is nothing on record to show that the report was not proper. The only attempt made by the appellant was to suppress the said report so that it should not see the light of the day. In view of this, since the valuation report is by the Executive Engineer, Building & Communication Department and the officer of the appellant who also gave report in other five cases in respect of adjoining lands wherein in respect of those five lands his report was accepted, according to our opinion, the trial court was right in relying upon the said report and thereby fixing the valuation of the lands on the basis of the said report. In view of this, according to our opinion, the trial court was right in granting compensation of Rs.21,98,228/- towards the acquisition of the land in question on the basis of Rs.79,110 per acre.

9. The next question to be decided is as to whether the trial Court was right in giving benefit of solatium under Section 23(2) and also benefit under Section 23(1-A) of the Land Acquisition Act. According to Mr. Deshpande, the learned counsel appearing on behalf of the appellant-Government, the amended provisions of the Land Acquisition Act will not be applicable to the award which was given much prior to the amendment of the Land Acquisition Act and more particularly in view of Section 33(5) read with Section 38 of the M.I.D. Act.

10. Mr. Deshpande, the learned Assistant Government Pleader contended that in view of the express provisions of Section 33(5) of the M.I.D. Act, 1961, the provisions of Section 23 & 24 of the Land Acquisition Act are incorporated into M.I.D. Act in the year 1967. Secondly, according to him, in view of a specific provision under Section 38 of the M.I.D. Act, the claimants are entitled to interest @ 4% and they are not entitled to the interest awarded by the District Judge in accordance with Sec.28 of the Land Acquisition Act.

11. As against this, Shri Dhakephalkar contended that considering the object of the legislation and the language in which Section 33(5) of the M.I.D. Act is couched, it is more than clear that provisions of the Land Acquisition Act are adopted by reference and not incorporated therein and the provisions of Sec.23(1)(a), 23(2) and Sec.28 will be applicable to the present acquisitions. He also referred to the original Sec.33(5) as it stood before amendment, which contained a specific provision to determine compensation under the M.I.D. Act. It was amended by the Maharashtra Act No.XI of 67. The statement of objects and reasons of the amendment Act shows that, it was with a view to ensuring that the owner gets compensation as provided under the ordinary law i.e. the Land Acquisition Act that this amendment was introduced. Obviously therefore, contends Mr. Dhakephalkar, this amendment is introduced with a view to removing discrimination. Therefore, if there is a subsequent amendment in the Land Acquisition Act providing for enhanced compensation or the rate of interest, the same should be applicable to the acquisitions under the M.I.D. Act also. In this connection, Shri Dhakephalkar has relied upon the judgment of the Supreme Court, reported in AIR 1991 Supreme Court page 454. Mr. Dhakephalkar also relied upon a judgment of this Court in Criminal Appeal No.1135 of 1996 delivered on 16, 17 and 19 of December 1996 where, before this court a some what similar argument in the context of M.R.T.P. Act was advanced and this Court came to a conclusion that in case of acquisitions under the M.R.T.P. Act, the provisions of the Land Acquisition Act were adopted by reference, therefore the amended provisions viz. Sections 23 and 28 introduced by the Land Acquisition (Amendment) Act 1984 will apply to such acquisitions. Mr. Dhakephalkar contended that the ratio of the said judgment would be applicable to the facts of the instant case also.

12. To examine the contention of Mr. Dhakephalkar as to whether the amended provisions of the Land Acquisition Act, 1894 are adopted by reference in the M.I.D. Act, we must focus our attention on the distinction between adoption by reference and incorporation. In the case of Gauri Shankar Vs. State of U.P. reported in A.I.R. SCW page 3029, the Supreme Court held that in legislation by incorporation, the provisions of the former Act become an integral part of the latter Act, as it was written with ink and printed in the latter Act. It is not so in case of adoption by reference. In such a case, when the provisions of the former Act are repealed or amended, they cannot unless expressly made applicable to the subsequent Act, be deemed to be incorporated in it. Whether the case is one of incorporation or reference is to be judged by the scheme, language employed and purpose the statute seeks to achieve. If the latter Act merely makes reference to the earlier Act or existing law, it is only by way of reference and all amendments subsequently made will have effect unless if, operation is saved by Section 8(1) of the General Clauses Act or it is void under Article 254 of the Constitution of India.

13. Reference may also be made to the judgment, relied upon by Shri Dhakephalkar, reported in A.I.R. 1971 Supreme Court Page 454; NEW CENTRAL JUTE MILLS CO. LTD. Vs. ASST. COLLECTOR, CENTRAL EXCISE, ALLAHABAD & OTHERS, where the Supreme Court referred to the Judgment reported in AIR 1962 Supreme Court Page 316 and considered the usual and recognised formulae generally employed to effect incorporation. The Supreme Court quoted them as under :

(i) ".....shall, for that purpose, be deemed to form part of this Act in the same manner as if they were enacted in the body thereof....."

(ii) "the provisions of S...... of the said Act shall apply as if they were herein enacted."

Mr. Dhakephalkar contended that in the absence of such words it can not be presumed that the provisions of Land Acquisition Act were incorporated in the M.I.D. Act.

14. Now, keeping the above observations of the Supreme Court in mind, we will examine whether the provisions of Section 23(2) and 23(1)(a) which were inserted in Land Acquisition Act, 1894 by Land Acquisition (Amendment) Act 68 of 84 could be said to be adopted by reference in M.I.D. Act 1961.

15. The controversy could be better appreciated if we first have a look at the relevant provisions of the unamended M.I.D. Act and the amendments introduced therein. In the unamended M.I.D. Act 1961, Chapter VI was devoted to the acquisition and disposal of land. Section 32 provided for compulsory acquisition of land. Section 33 dealt with compensation to be awarded. In Sec.33 there was a detailed procedure laid down for awarding the compensation. Sub-section (5) of Sec.33 laid down the guiding principles in determining the amount of compensation. Sec.34 made provision for appeal from the decision of the Collector. Where the land was situate in Greater Bombay, the person aggrieved could appeal to the City Civil Court, elsewhere to the District Court. Section 35 related to dispute as to apportionment. Sec.36 made provision for payment of compensation. Sec.37 provided for investment of amount deposited in the Court and Sec.38 made provision for payment of interest where the amount of compensation is not paid or deposited on or before taking possession of the land. Section 39 referred to the disposal of land by the Corporation and Section 42 referred to delegation of powers of the State Government.

16. Since the controversy in the present case revolves around Sec.33(5) and Sec.38, it will be necessary to have a closer look at them. Section 33(5) of the Old Act read thus:

"33.(5): In determining the amount of compensation, the collector shall be guided by the following principles, namely:-

(a) the value of the land shall be taken to be -

(i) the market value of the land on the date on which the notice calling upon the owner to show cause why the land should not be acquired is issued under sub-section (2) of the last preceding section (hereinafter referred to as "the date of notice"), such market value being determined on the basis of the use of the land on that date, or

(ii) an amount equal to the sum total of the three following amounts, that is to say, an amount equal to the market value of the land on the date of notification of the area in which it is situated under sub-section (3) of Section 1, such market value being determined on the basis of the use of the land on that date, an amount equal to twenty-five per cent of the increase, if any, (not including, however, any increase consequent on any development carried out on the land) in the market value of the land during the period between the date of such notification under sub-section (3) of Section 1 and the date of notice, and an amount which in the opinion of the Collector represents the reasonable cost of development, if any (including in the case of agricultural land, the cost of any improvement carried out thereon in the course of agricultural operations) carried out on the land during that period by any person other than the Corporation-

whichever is less;

(b) the special suitability or adaptability of the land for any purpose shall not be taken into account if that purpose is a purpose to which it would be applied only in pursuance of statutory powers, or for which there is not a market apart from the special needs of a particular purchaser or the requirements of the Government or any local or statutory public authority;

(c) where the value of the land is increased by reason of the use thereof or of any premises thereon in a manner which could be restrained by any Court, or is contrary to law, or is detrimental to the health of the inmates of the premises or to public health, the amount of that increase shall not be taken into account;

(d) in addition to the value of the land as above provided, in every case, a sum of fifteen per centum on such value shall be awarded, in consideration of the compulsory nature of the acquisition."

17. Section 33(5) of the Old Act was amended by Maharashtra Act 11 of 67. The statement of objects and reasons of the said Act reads thus:

"(1) In view of certain writ petitions pending in the High Court and the trend of recent decisions of the High Court and the Supreme Court, Government is advised that Section 33(5) of the Maharashtra Industrial Development Act, 1961, which may operate to the disadvantage of the public, should be amended with retrospective effect, so that when any land is acquired under the said Act the owner will get compensation as provided under the ordinary law, viz., the Land Acquisition Act, 1894. Consequently, in the case of persons whose lands are already acquired, they will get an opportunity to claim the difference (if any) between the compensation already awarded and that which would have been awarded under the Land Acquisition Act, 1894. Since the provisions as regards compensation have to be brought in line with the corresponding provisions in the Land Acquisition Act, Section 41 of the Maharashtra Industrial Development Act is unnecessary."

A perusal of the statement of objects and reasons will show that, the amendments were aimed at mitigating the hardship caused to the claimants where the lands were acquired under the M.I.D. Act 1961 by bringing them on par with the claimants whose lands were acquired by applying relevant provisions of the Land Acquisition Act. Section 33(5) as amended by Maharashtra Act 11 of 67 reads thus:

"33(5): In determining the amount of compensation, the Collector shall be guided by the provisions contained in Sections 23 and 24 and other relevant provisions of the Land Acquisition Act 1894, subject to the modifications that the references in the said Sections 23 and 24 to the date of the publication of the notification under Section 4, sub-section (1), were references to the date of the service or publication of the notice under sub-section (2) of Section 32 of this Act is in the manner for the time being laid down under this Act, and the references to the time or date of the publication of the declaration under Section 6 were references to the date of the publication of the notice under sub-section (1) of Section 32 of this Act in the Official Gazette."

The language of Section 33(5) clearly indicates that it adopts by general reference provisions of the Land Acquisition Act for determining compensation to be awarded to persons whose lands are acquired under the M.I.D. Act 1961. Section 33(5) rests content by pointing its finger to the relevant provision of the Land Acquisition Act for the purpose of guiding the Collector in determining the amount of compensation to be awarded to the persons whose lands are acquired under the provisions of the M.I.D. Act 61. It is significant to note that the entire old S.33(5) which contained principles meant for guiding the Collector in determining compensation was substituted by new S.33(5) by Maharashtra Act 11 of 67. The statement of objects and reasons of Maharashtra Act 11 of 67 by which this section was substituted shows the obvious intention of the legislature namely to remove discrimination and ensure that the persons concerned get compensation by following the ordinary law. Therefore, if there is subsequent amendment in the Land Acquisition Act contemplating enhanced compensation, or rate of interest the same would be applicable to acquisitions under M.I.D. Act also. The language of this section taken alongwith the objects and reasons of the amending Act leave no manner of doubt that the provisions of Sections 23 and 24 of the Land Acquisition Act are adopted by reference in the M.I.D. Act 61 in 1967 when sub-section (5) of Section 33 was substituted by Maharashtra Act 11 of 67.

18. In this connection, it will be necessary to refer to the judgment of this Court in Criminal Appeal No.1135 of 1996 delivered on 16th, 17th and 19th of December 1996 where before this Court, a some what similar argument in the context of the M.R.T.P. Act was advanced and this Court, after considering the judgment of the Supreme Court delivered in the case of STATE OF MAHARASHTRA Vs. SANT JOGINDER SINGH, reported in A.I.R. 1995 Supreme Court Page 2181, came to the conclusion that, in the case of acquisition under the M.R.T.P. Act, the provisions of Land Acquisition Act were adopted by reference and, therefore, the amended provisions of Section 23 and 28 introduced by the Land Acquisition (Amendment) Act, 1984 will apply to such acquisitions. It will be necessary to make a brief reference to the controversy before the Supreme Court in Joginder's case (supra).

19. The limited question before the Supreme court in Joginder's case (was whether if under the M.R.T.P. Act award is not made within 2 years from the date of the declaration under Sub-section (2) of S.126, by operation of S.11-A of the Central Act as introduced by Land Acquisition Amendment Act 68 of 84; the notification published under S.125 shall be deemed to have been lapsed. In other words, whether S.11-A of the Central Act could be deemed to have been adopted by reference in the M.R.T.P. Act. The Supreme court came to a conclusion that in S.128 of the M.R.T.P. Act the legislature had engrafted the provisions of S.16, 17 and 24 of Central Act as its part. Whenever the legislature intended to apply the specific procedure it did so specifically. No attempt was made by the State Legislature to amend the Act introducing or incorporating S.11-A of the Central Act as part of the Act. Since the legislature had incorporated specific provisions of the Central Act, the necessary conclusion is that the legislature did not intend to apply the unspecific provisions of the Central Act to the exercise of the power the Act. If the legislature would have merely adopted the Central Act, subsequent amendments to that Act made under Act 68 of 84 would have become applicable perforce. However, in para 12 of the said judgment while considering the question whether because no separate procedure was prescribed by the M.R.T.P. Act for determining the compensation, by necessary inference the Central Act was intended to apply mutatis mutandis to the acquisition under the Act, the Supreme court held that since no separate procedure is prescribed under the M.R.T.P. Act to determine compensation for the land acquired under the Act by necessary implication, compensation needs to be determined by applying the principles in S.23 of the Central Act. It further held :

"..... there is a distinction between procedural and substantive provisions of a statute. Determination of compensation by applying appropriate principles is relatable to substantive provision, whereas making of award within a prescribed period is basically procedural. So, merely because S.23 of the Central Act would apply to acquisition under the Act, is not enough to hold that what is contained in S.11-A would also apply. Further, what has been provided in sub-section (4) of S.126 of the Act is clear indication that failure to make the award within two years from the date of the declaration under sub-section (2) of S.126 of the Act, would not render the notification published under S.125 of the Act nonest."

This Court, relying on para 12 of Joginder's case (supra) quoted hereinabove, held that, the observations of the Supreme Court were in respect of the procedural provisions i.e. Sec.11-A of the Land Acquisition Act and since there is a contrary intention provided under Sec.126(4) of the M.R.T.P. Act, 1966 namely, that failure to make award within two years from the date of declaration in sub-section (2) of S.126 of the M.R.T.P. Act would not render the notification published under S.125 of the Act nonest, the Supreme Court had in that context held that, Section 11-A introduced by Land Acquisition (Amendment) Act 84 cannot be said to be adopted by reference in the M.R.T.P. Act. Drawing support from paragraph 12 of Joginder's case, this Court took a view that, provisions of Section 23(1)(a), 23(2) and 28 introduced by the Land Acquisition (Amendment) Act 1984 were adopted by reference in the M.R.T.P. Act. It was also held that Sec.11-A was introduced in Land Acquisition Act to mitigate the hardship caused to the owners of the land where land had been acquired and there was delay in passing award. In M.R.T.P. Act, Sec.126 has taken care of this problem by providing that, if any award is made within a period of three years, Government has to make a fresh declaration under Sec.126(4) for acquiring the land but the market value of the land shall be deemed to be the market value at the date of declarations made in the Official Gazette for acquiring the land afresh and therefore the Supreme Court in Joginder's case (supra) held that provision of S.11-A is not adopted by reference in the M.R.T.P. Act. Considering all these aspects, this Court after distinguishing Joginder's case (supra) took a view that the amendments introduced by the Land Acquisition (Amendment) Act of 84 viz., Sections 23(1)(a), 23(2) and 28 were adopted by reference in the M.R.T.P. Act. The ratio of the said case can also be applied to the present case having regard to the language of Sec.33(5) and the intention of the legislature as is evident from the statement of objects and reasons of Maharashtra Act 11 of 67. We have therefore, no hesitation in coming to the conclusion that the provisions of Sec.23 and 24 of the Land Acquisition Act are adopted by reference in the M.I.D. Act in the year 1967 by Maharashtra Act 11 of 67 in view of Sec.33(5) of the M.I.D. Act substituted thereby.

20. Coming to the next contention of Mr. Deshpande viz. that, in view of the specific provision under Sec.38 of the M.I.D. Act, the claimants are entitled for interest @ 4% and they are not entitled for the interest awarded by the District Judge in accordance with Sec.28 of the Land Acquisition Act, it will be necessary to have a closer look at both these sections. Section 38 of the M.I.D. Act reads as under :

"38. When the amount of such compensation is not paid or deposited on or before taking possession of the land, the State Government shall pay the amount of compensation determined with interest thereon at the rate of four per cent per annum from the time of so taking possession until it shall have been so paid or deposited."

Section 28 of the Land Acquisition Act reads thus:

"28. Collector may be directed to pay interest on excess compensation:- If the sum which, in the opinion of the Court, the Collector ought to have awarded as compensation is in excess of the sum which the Collector did award as compensation, the award of the Court may direct that the Collector shall pay interest on such excess at the rate of (nine per centum) per annum from the date on which he took possession of the land to the date of payment of such excess into Court :

Provided that the award of the Court may also direct that where such excess or any part thereof is paid into Court after the date of expiry of 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 such excess or part thereof which has not been paid into Court before the date of such expiry."

A careful reading of both these provisions show that Sec.38 of the M.I.D. Act and Sec.28 of the Land Acquisition Act are absolutely distinct and separate provisions independent of each other. Their area of operation is different. Firstly, Section 34 is a direction to the State Government to pay interest at the rate of 4% if the amount of compensation is not paid or deposited before taking possession of the land. It is, thus, a direction to the State Government. In the M.I.D. Act, the State Government can take possession under Section 32(5) even before making an award for getting compensation. Therefore, to compensate a person for the loss which will be caused to him if his possession is taken earlier and compensation is paid subsequently, the said provision is enacted. Section 28 of the Land Acquisition Act arises only when a reference is made to the District Court. It is the District Court's power to award interest. The said section would come into play only -

(a) if a reference is made to the District Court;

(b) District Court decides to award excess compensation.

It is pertinent to note that by the said section, District Court can award interest only on excess amount which he decides to award. Thus, these provisions are totally distinct and different provisions and, therefore, the submission that in respect of interest there is a specific provision under the M.I.D. Act and, therefore, Section 28 is not applicable is totally incorrect.

21. It is also significant to note that when by Act XI of 67, S.33(5) was amended, S.34 was not amended. In 1975 by Act No.XVIII of 75 S.34 was amended and instead of appeal reference was provided and it was further stated that in case of such a reference the provisions of Part-III of the Land Acquisition Act shall Mutatis Mutandis apply to further proceeding in respect thereof. S.28 is in Part III of the Land Acquisition Act and therefore, it will apply to the present proceeding before the District as they are out of reference u/s. 34. In this connection, we endorse the reasoning given by the District Court in para 34 of its judgment as to why he has awarded interest as per S.28 of the Land Acquisition Act.

22. Since we are unable to accept any of the submissions advanced on behalf of the State in support of the present Appeal by Shri Deshpande, the learned Assistant Government Pleader, First Appeal No.832 of 90 must fail and is dismissed accordingly. The judgment and decree dated 25.4.90, passed by the Extra-Joint District Judge, Pune in Land Reference No.75 of 81 is confirmed with no order as to costs.

Appeal dismissed