The Supreme Court on Wednesday said the constitutional guarantee of fair compensation in land acquisition cases cannot be diluted. The court clarified that compensation and interest cannot depend on the quantum of financial burden. The top court rejected the review petition of the National Highway Authority of India (NHAI).
NHAI had sought review of the decision dated February 4, 2025. In this decision it was said that the 2019 decision will be applicable retrospectively. The 2019 decision talked about giving compensation and interest to the farmers of the land acquired under the NHAI Act. The bench said the interest payable to landowners would be nine per cent as per the Land Acquisition Act.
This will not be as per the five per cent limit of the NHAI Act. NHAI had claimed that the financial liability would be Rs 29,000 crore. Earlier this amount was said to be Rs 100 crore. The Chief Justice said that estimation of financial liability is not a valid basis for review.
However, the bench said that its previous decisions required limited explanation. This is to ensure a consistent understanding of the scope and impact of the decision. It is undisputed that the landowners of the land acquired under the National Highways Act are entitled to compensation and interest. These are part of fair compensation.
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