JUDGMENT Poonam Srivastava, J.
1. Connect this revision along with civil revision No. 77 of 2006.
2. Heard Sri B.I). Mandhyan, Senior Advocate, assisted by Sri Satish Mandhyan, learned Counsel appearing for the revisionist and Sri Manish Goyal, learned Counsel appearing for the opposite parties.
3. The civil revision No. 78 of 2006 is against the judgment and order dated 25.1.2006 passed in execution case No. 7 of 1993 in land acquisition case No. 47 of 1981, Brij Behari and Ors. v. State, By virtue of the impugned order an earlier order dated 9.4.2002 passed by his predecessor has been recalled whereby an additional liability has been created against the Mandi Samiti. Civil revision No. 77 of 2006 is against the judgment and order dated 16.1.2006 passed in misc. case No. 6 of 2002 in the execution case No. 7 of 1993, Maya Somani and Ors. v. State and Anr.. Both the revisions are being decided simultaneously by a common order.
4. Facts giving rise to the dispute is that notification under Section 4 of Land Acquisition Act 1894 (hereinafter referred as the Act) was issued on 2.6.1978 and consequent thereon possession was taken over on 27.7.1978. Award was given under Section 11 of the Act on 22.5.1981. The contesting opposite party preferred a reference No. 47 of 1981, which was decided in favour of the claimants on 21.10.1986, whereby rate of the land was fixed at Rs. 25/- per square yard. Mandi Samiti preferred first appeal against the reference order, which was dismissed on 4.5.1990. The order was challenged before the Apex Court. S.L.P. tiled by Mandi Samiti was dismissed on merit on 11.121990 However, the revisionist was permitted to deduct 25% of principal sum awarded from the total amount of compensation towards development charges. The order of the Apex Court is annexed as annexure No. 1 to the stay application. Claimant/respondents filed an execution case No. 7 of 1993 on 23.12.1993. The executing court proceeded with the execution on the basis of calculation submitted by the claimant/respondents and step for attachment was taken on 17.10.1997. An application was filed to recall the said order, which was rejected on 28.10.1997. Against which, a civil revision No. 17 of 1998 was preferred. This Court stayed the order dated 17.10.1997 during pendency of the civil revision, which was finally disposed on 13.2.2001. The matter was remanded to the executing court to consider the calculation of the amount given by the parties. The executing court was directed to arrive at a definite conclusion in confirmation with the direction of the Apex Court. The executing court passed an order on 5.3.2002. This order has been annexed as annexure No. 3 along with counter affidavit. Perusal of the said order shows that the executing court directed the parties to submit actual amount to be given to the claimants in accordance with the direction of the Apex Court, whereby 25% of the development charges is to be deducted from the amount under Section 23 of the amended Act. This 25% deduction is to be made from the principal amount without adding interest. Next date fixed was 13.3.2002 and the parties were required to submit their calculation by that date. Calculation sheet was submitted by the State of U.P. on 20.3.2002 but the claimants failed to submit their calculation and consequently, the executing court passed an ex parte order on 9.4.2002. This order was sought to be recalled by the claimants by means of an application dated 29.4.2002, to which the revisionist preferred his objection on !9.7.2002. The order was recalled on 16.1.2006, which is impugned in the present civil revision No. 77 of 2006 and final order was passed on 25.1.2006 accepting calculation of the claimants, which is impugned in civil revision No. 78 of 2006.
5. Sri Mandhyan, learned Counsel appearing for the revisionist has vehemently argued that final order was passed. There was no occasion for the executing court to recall its earlier order passed by his predecessor. Sri Mandhyan has stated in paragraph No. 7 of the affidavit filed by the Inspector Krishi Utpadan Mandi Samiti that since concerned officer was going to retire on 314.2006, earlier order was recalled for extraneous consideration and final order was passed on 25.1.2006. Therefore, it is emphatically submitted that the impugned orders are not bona fide and misuse of judicial power. It is further submitted that by means of the order dated 25.1.2006, the executing court has accepted the claim of the claimant/respondents in totality, whereby has created additional liability to the tune of Rs. 4800000/-(Rupees forty eight lakh) against Mandi Sainiti. Next submission is that while accepting calculation of the claimants, the court below has illegally awarded solatium at the rate of 30% and interest at 9% for the first year and at the rate of 15% per annum for the subsequent period, whereas the acquisition was prior to the amendment of the Act in the year 1984. Possession was also taken in the year 1978. Award was given in the year 1979, therefore, provision of unamended Act would apply. Sri Mandhyan has argued next that the Apex Court was very specific while modifying the judgment of the High Court as well as reference court that 25% of the principal sum awarded shall be deducted from total amount of compensation, therefore, it was only principal sum awarded under Section 23 of the Act and not total amount of compensation as done by the executing court, which has resulted in an additional liability. In fact, Mandi Samiti has already given Rs. 94,000/-(Rupees ninety four thousand) in excess to the claimants and nothing remains to be paid. In the circumstances, it is evident that entire controversy revolves round two questions;
1. Whether the executing court was correct in recalling its earlier order dated 9.4.2002 after a lapse of approximately four years on 16.1.2006, which was passed on the basis of the calculation submitted by the State of U.P.
2. The direction of the Apex Court for deduction of 25% from the principal amount towards development charges is to deduct the amount from the total compensation after adding the amount of solatium and the interest. Thus whether the decree holder is entitled to be given compound interest or only on the principal amount.
Sri Manish Goyal has emphatically countered each and every argument of Sri Mandhyan appearing for the Mandi Samiti. Counter affidavit has been filed. Sri Mandhyan submits that he does not prefer to file rejoinder affidavit as the controversy is not factual.
6. Section 23(1) of the Land Acquisition Act defines manner in which compensation of the land acquired under the Act is to be determined and what are the facts that has to be taken into consideration while calculating the compensation'.
7. It is contended by Sri Manish Goyal appearing on behalf of the claimants that the Constitution Bench of the Apex Court in the case of Sunder v. Union of India has interpreted the word "compensation" and also the total amount which is inclusive of solatium and interest. I have perused the said judgment and on entire reading, it is evident that the Constitution Bench concluded that a person entitled to the compensation awarded is also entitled to get interest on the aggregate amount including solatium. This is not the question involved in the present case. In fact, solatium and interest was already awarded by the court deciding the reference and confirmed by the High Court and also by the Apex Court. Only modification was for deduction of 25% of principal sum awarded, which is to be deducted from the total amount of compensation. The word principal amount as defined in blakes law addition in the sixth addition at page 1192 has been placed before me by Sri Goyal, which is quoted below:
Principal, n. The source of authority or right. A superintendent, as of a school.
An amount of money that has been borrowed or invested The capital sum of a debt or obligation, as distinguished from interest or other additions to it.
8. The argument advanced to elucidate meaning of 'principal sum'. Reliance has also been placed on a decision of Pubjab and Haryana High Court in the case of Devinder Kumar and Anr. v. Syndicate Bank and Ors. 1996 Company Cases (86), 267. A Division Bench of Punjab and Haryana High Court decided the expression principal sum which is quoted below:
The expression "principal sum" means the original amount lent without the addition thereto of any interest whatsoever. The court, while decreeing suit will adjuge, (i) the principal sum, and (ii) any interest on such principal sum prior to the date of institution of the suit. Both the amounts adjuged by the court by way of "principal sum" as well as "interest" thereon for the period prior to the institution of the suit together may be termed as "aggregated amount adjuged" as payable on the date of the suit. But interest under Section 34 of the Code is not payable on such aggregate amount. It is made payable only on the principal sum adjudged. No interest is payable on the amount of interest adjudged on such principal sum. Interest, whether simple or compound, will remain "interest" for the purpose of Section 34 and shall never merge in the principal. The Legislature while using the expression "in addition to any interest adjudged on such principal for any period prior to the institution of the suit" in Section 34 in contradistinction to the expression "principal sum " has not made any distinction between the interest computed by way of simple interest or compound interest. The expression "principal sum adjuged" in Section 34 of the Code means the original amount lent, without addition thereto of any interest whatsoever. This will be the position notwithstanding any agreement between the parties or any prevailing banking or trade practice to the contrary. Similarly, rule of Order 34, inter alia, takes account of what is due to the plaintiff at the date of preliminary decree for "principal" and "interest on the mortgage". Under Clause (b) of Sub-rule (I) of Rule 2 of Order 34 the court has to declare the amount so due at that date. A conjoint reading of clauses (a) and (b) of Sub-rule (1) of Rule 2 of Order 34 makes it abundantly clear that the "principal" and "interest" have to he ascertained separately and declared to be due as such. Rule 2 does not contemplate merger of interest in the principal and determination of the aggregate amount due on account of both. Interest under Rule 11(a)(i) of Order 34 of the Code is payable on "the principal amount found or declared due on the mortgage ". Under Sub-clause (iii) of Rule 11 (a), such interest is also payable on the amount adjudged due to the mortgagee for costs, charges and expenses up to the date of the preliminary decree and added to the mortgage money. The court thus has been empowered to award interest under Rule 11(a) on all the components of the amount found or adjuged due to the plaintiff except on the "interest". Similarly, subsequent interest up to the date of realization or actual payment can also be awarded under Rule 11(b) only on the "aggregate of the principal sums specified in Clause (a) " thereof. It is thus evident that interest under either of the two clauses of Rule 11 can be awarded only on the principal. Interest due before the date of filing of the suit is not treated as principal. It is also evident from the fact that the amount of interest due to the plaintiff has to be determined separately.
9. On the basis of the aforesaid principle, the argument advanced on behalf of the claimants is that it is obligatory for the revisionist to pay solatium and therefore, principal amount will include solatium plus market value and the interest thereon. In view of the direction of the Apex Court, 25% is to be deducted from the market value plus solatium. It can not be said that the market value fixed under Section 23(1) is principal amount. The amount already awarded minus 25% and 30 % solatium is to be calculated on the said amount fixed. Sri Goyal laid emphasis on the basis of another decision of the Apex Court in the case of Radha Sundar Dutta v. Mohd. Jahadur Rahim and Ors. . The observation in the said decision by Lord Wrenbury is quoted below:
If in a deed an earlier clause is followed by a later clause which destroys altogether the obligation created by the earlier clause, the later clause is to be rejected as repugnant and the earlier clause prevails. In this case the two clauses cannot be reconciled and the earlier provision in the deed prevails over the later
10. In reply to the argument advanced by Sri Goyal, Sri Mandhyan has cited a number of decisions. The first decision relied upon is, Chimanlal Hargovinddas v. Special Land Acquisition Officer, Poona and Anr. . In the said case, the land acquired was valued at the rate of Rs. 7,000/- against valuation of the best parcel of land at Rs. 20,000/- which was made precisely to account for the factor pertaining to its situation in the interior. The final valuation was held to be at the rate of Rs. 7,000/- per acre because development would reach at the stage of Rs. 20,000/- per acre after 12 years. Since the market value is assessed on the date of acquisition therefore, the court came to a conclusion that it was Rs. 7,000/- per acre. The Apex Court deducted 25% from compensation of Rs. 7,000/- per acre. In paragraph 12 of the said decision Chimanlai (Supra), the Apex Court came to a conclusion that the appellant was entitled to compensation for 13 acres 7 gunthas at the rate of Rs. 7000/- less by 25% i.e. minus 1750=Rs. 5250/-. In the circumstances, the Apex Court came to conclusion that the development charge of Rs. 25% may be deducted from the market value. There are several decisions cited on behalf of counsel for the revisionist, Ahad Brothers v. State of M.P. and Anr. , V. Hanumantha Reddy (dead) by LR's v. Land Acquisition Officer and Mandal R. Officer 2004 (54) A.L.R. 141, The Land Acquisition Officer, Kammarapally Village, Nizamabad District, Andhra Pradesh v. Nookala Rajamulla and Ors. , Hasanali Walimchcmd (dead) by LRs. v. State of Maharashtra , Allahabad Development Authority v. Shakeel Ahmad and Ors. 2004 All. C.J. 753.
11. After hearing counsel for the respective parties at length and taking into consideration various decisions, I am of the view that since earlier order dated 9.4.2002 was an ex parte order and passed on the basis of calculations submitted by the State of U.P. alone, claimant/respondents had not submitted calculation sheet and the order passed is an ex parte one. No doubt, the order has been recalled after lapse of four years on 16.1.2006 but as submitted by the counsel for the respondents that this was for the reason detailed in the application and after consideration of the objection filed by the revisionist. In the circumstances, the order dated 16.1.2006 passed in misc. case No. 6 of 2002 does not call for any interference. Allegation of the counsel for the revisionist in respect of the executing court that the order was recalled for consideration other than the judicial ones is without any substance. Besides, the Presiding Officer has not been arrayed as a party and no specific allegation has been levelled, which could be countered by the concerned Officer. In the circumstances, the order dated 16.1.2006 recalling earlier order does not call for any interference, Civil Revision No. 77 of 2006 is dismissed.
12. On perusal of the judgment and order dated 25.1.2006 challenged in Civil Revision No. 78 of 2006, it is apparent that the executing court has come to an erroneous conclusion that the claimants are entitled for 25% deduction from the total amount i.e. after adding solatium and interest to the market value. The interpretation of the order of Hon'ble Supreme Court by the executing court cannot be accepted. In fact, solatium and interest is to be calculated after fixing the market value. In the present case, the Apex Court has only reduced the compensation by 25%, which was awarded towards development charges. Therefore, the 25% deduction is to be made from the market value and thereafter the solatium and interest should be calculated. The decision of the Apex Court in the case of Chimanlal Hargovinddas (supra) appears to be the final verdict. The Apex Court deducted 25% of compensation from the market value. In the circumstances, 1 am in agreement with the argument of the counsel for the revisionist that 25% deduction is to be made from the market value, solatium and interest is to be added after deducting 25%. Calculation arrived at by the executing court in deducting 25% from total value does not appear to be correct interpretation. The case is remanded with a direction that the executing court shall proceed to make afresh calculation in view of the direction of the Apex Court. In the present case, 25% of development charges is to be deducted from the market value awarded under Section 23(1) of amended Act and, therefore, from the principal amount, solatium and interest is to be calculated. The civil revision No. 78 of 2006 is allowed.