ivil Appeal No 859 of 1987
Shankar Ghosh and LPAggarwal for the Appellants From the Judgment and order dated 88
1985 of the Calcutta High Court in Appeal No 329 of 1982
VC Mahajan B Parthasarhti and CV Subba Rao for the Respondents
The Judgment of the Court was delivered by SABYASACHI MUKHARJI J
This appeal by special leave is confined solely to the question of interest
In other words the entitlement of interest on the amount awarded by Arbi trator for the requisition of the premises under the Requi sitioning and Acquisition of Immovable Property Act 1952 is the issue
The principles upon which the compensation on this aspect is payable are by now well settled
In Satinder Singh  Ors
vs Amrao Singh  Ors  this Court reiterated the principles at page 694 of the report as follows In Inglewood Pulp and Paper Co Ltd vs New Burnswick Electric Power Commission it was held by the Privy Council that upon the expropriation of land under statuto ry power whether for the purpose of private gain or of good to the public at large the owner is entitled to interest upon the princi pal sum awarded from the date when possession was taken unless the statute clearly shows a contrary intention  Dealing with the argu ment that the expropriation with which the Privy Council was concerned was not effected for private gain but for the good of the public at large it observed but for all that the owner is 1047 deprived of his property in this case as much as in the other and the rule has long been accepted in the interpretation of statutes that they are not to be held to deprive indi viduals of property without compensation unless the intention to do so is made quite clear
The right to receive the interest takes the place of the right to retain posses sion and is within the rule
It would thus be noticed that the claim for interest proceeds on the assumption that when the owner of immovable property loses possession of it he is entitled to claim interest in place of right to retain possession
The question which we have to consider is whether the application of this rule is intended to be excluded by the Act of 1948 and as we have already observed the mere fact that section 53 of the Act makes section 231 of the Land Acquisition Act 1894 applicable we cannot reasonably infer that the Act intends to exclude the applica tion of this general rule in the matter of the payment of interest
That is the view which the Punjab High Court has taken in Surjan Singh vs The East Punjab Government AIR 1957 Punj
265 and we think rightly
 The same principle was reaffirmed not in the context of Acquisition of Immovable Property which Mr Mahajan learned counsel for the respondents tried to make a point before us was highlighted in National Insurance Co Ltd Calcutta vs Life Insurance Corporation of India 1963 Supp 2 SCR 971
at 992 where speaking for the court Mr Justice Hidayatullah as learned Chief Justice of India then was observed The reason of the rule was stated a long time ago by Lord St Leonard LC Birch vs Joy 1852 III HLC 56510 ER 222 as follows The parties change characters the property remains at law just where it was the purchas er has the money in his pocket and the seller still has the estate vested in him but they exchange characters in a Court of Equity the seller becomes the owner of the money and the purchaser becomes the owner of the estate On entering possession the purchaser becomes entitled to the rents but if he has not paid the price interest in equity is deemed pay able by him on the purchase price which 1048 belongs to the seller
This principle was applied by the House of Lords in cases of compulsory purchases
In Swift  Co vs Board of Trade Viscount Cave LC gave the reason that the practice rests upon the principle that the taking of possession is an implied agreement to pay interest which was stated by Sir William Grant MR in Fludyer vs Cocker  This principle was further extended by the Privy Council to the compulsory taking over of a business as a going concern in International Railway Co vs Niagara Parks Commission 1944 AC 328
It was noted by Justice Hidayatullah that this principle has also been accepted by this Court in Satinder Singh vs Amrao Singh supra
The principle stated was followed in Hirachand Kothari dead through Lrs
vs State of Rajasthan  Anr 1985 Suppl
1 SCR 644 where this court noted the principle at page 655 of the report
In the light of the aforesaid decision we are of the opinion that the appellants herein are entitled to the interest for the period from March 1975 to 31st July 1987 when principal amount of compensation had been paid and or when the premises in question had been de requisitioned and handed back to the owner on the amount awarded
As to how the interest would vary but the right of interest was well avered and also should have been considered in the light of the observations of Privy Council in Inglewood Pulp and Paper Co Ltd vs New Burnswick Electric Power Commission AIR 1928 Privy Council 287
We are of the opinion that from the period from March 7 1975 to February 28 1985 being the date on which the judgment of the High Court was pronounced in this case the appellants are entitled to the interest on the amount awarded at the rate of 6 per annum and from the period from August 87 1985 to July 31 1987 and for that period only at the rate of 12 per annum
Interest will be payable only on the balance amount which remained to be payable to the appellants ie the amount due minus what has been paid from the respective dates
The appellants are entitled to the costs of this appeal
The amount is directed to be paid within three months from this date by the respondents
In case there is any difficulty in calculating the amount the parties will be at liberty to apply to the High Court of Calcutta
The appel lants are entitled to costs of this appeal
The appeal is thus disposed of
SL Appeal dis posed of


Summary:
This appeal by special leave was confined solely to the question of entitlement of interest on the amount awarded by the Arbitrator for the requisition of the premises under the 
Disposing of the appeal the Court HELD The principles upon which the compensation on this aspect is payable are by now well settled
This Court reit erated the principles in Satinder Singh and Ors
vs Amrao Singh and Ors  at 694 National Insurance Co Ltd Calcutta vs Life Insurance Corporation of India 1963 Supp
2 SCR 971 at 992 and Hirachand Kothari dead through Lrs
vs State of Rajasthan  Anr 1985 Suppl1 SCR 644 at 655
1046F 1048C In the light of the aforesaid decisions the Court was of the opinion that the appellants herein were entitled to the interest for the period from March 1975 to the 31st July 1987 when the principal amount of compensation had been paid andor when the premises in question had been de requisitioned and handed back to the owner on the amount awarded
The Court was of the opinion that for the period from March 7 1975 to February 28 1985 being the date on which the judgment of the High Court was pronounced in this case the appellants were entitled to the interest on the amount awarded at the rate of 6 per cent per annum and for the period from August 8 1985 to July 31 1987 for that period only at the rate of 12 per cent per annum
The interest would be payable only on the balance amount which remained to be paid to the appellants ie the amount due minus what had been paid from the respective dates
The Court directed that the amount be paid by the respondents within three months from the date of this judgment and that in case there was any difficulty in calculating the amount the 1046 parties would be at liberty to apply to the High Court
1048C H Satinder Singh  Ors
vs Amrao Singh  Ors   National Insurance Co Ltd Calcutta vs Life Insurance Corporation of India 1963 Supp 2 SCR 971 at 992 Hirachand Kothari dead through Lrs vs State of Rajasthan  Ors 1985 Supp 1 SCR 644 and Inglewood Pulp and Paper Co Ltd vs New Burnswick Electric Power Commission AIR 1928 Privy Council 287 referred tO