Highway Land: Solatium Under Which Act?

What happened

Land near Jabalpur was acquired for a national highway. The notification under Section 3A of the National Highways Act was published in the Official Gazette on 7 June 2011 and in newspapers on 1 July 2011. Objections were called for, and the declaration under Section 3D followed on 20 January 2012. Notice went to the landowners on 1 September 2012. The Competent Authority determined the compensation by an order dated 11 July 2014, awarding a total of ₹3,47,38,287. The appellant received the ₹49,17,000 due to him on 13 October 2014, disputed the quantum, and the dispute went to the Arbitrator under the National Highways Act. The Arbitrator's order was in turn challenged under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996, and those orders came before the Supreme Court. By the time it reached the Court, only one question was left. Nobody disputed that solatium, interest and interest on solatium were payable. The fight was about the **rate** — whether they are computed under the Land Acquisition Act, 1894 or under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The difference is not small: the Court, quoting its own earlier decision, recorded that the First Schedule to the 2013 Act provides solatium equivalent to 100% of the market value, multiplied by factors that depend on whether the land is rural or urban. The landowner argued the 2013 Act applied, and alternatively that the Arbitrator's award came after the cut-off date anyway. NHAI argued the Competent Authority's award of 11 July 2014 predated the 2013 Act's application to highway acquisitions, so the 1894 Act governed.

What the court held

To see why one date decides this, you have to follow how the 2013 Act reached the National Highways Act at all. The 2013 Act came into force on 1 January 2014. But **Section 105(1)** kept it away from the land acquisition enactments listed in its Fourth Schedule — and the National Highways Act, 1956 is one of them. **Section 105(3)** required the Central Government to notify, within a year, that the compensation and rehabilitation provisions would apply to those enactments. By Ordinance 9 of 2014, Section 105(3) was amended to say that the provisions relating to compensation under the First Schedule and rehabilitation under the Second and Third Schedules “shall apply to the enactments relating to land acquisition specified in the Fourth Schedule with effect from 1st January, 2015”. The Court read that one-year gap as deliberate: it was there to give the Competent Authority under the National Highways Act a year to determine compensation in acquisitions already under way. **So the rule (para 23) is this.** If a determination of compensation had **not** been made before 1 January 2015, the 2013 Act applies. If the Competent Authority **had** determined compensation before 1 January 2015 — even if that was after 1 January 2014 — then solatium, interest and interest on solatium are payable under the 1894 Act. **Which order counts as the “award”?** This is the part that decided the case. The Court held that the determination by the Competent Authority under Section 3G(1) of the National Highways Act is the equivalent of the Collector's award under Section 11 of the 1894 Act, while the Arbitrator's determination under Section 3G(5) is the equivalent of a civil court's determination on a reference under Section 18. It is therefore the **Competent Authority's** date that governs, not the Arbitrator's. Here that was 11 July 2014 — before the cut-off — so the 1894 Act applied. The landowner also relied on a Ministry of Road Transport and Highways notification saying the 2013 Act would apply where awards had been announced but compensation had not been paid “in respect of majority of the land holdings” as on 31 December 2014. The Court read the words closely: the notification says *land holdings*, not *landowners*. NHAI showed that of 3.080 hectares acquired, compensation for 1.700 hectares had been paid in 2014 itself. The notification did not help. **The appellant still won something.** The Court allowed the appeal to the extent of directing that the compensation determined by the arbitration award carry solatium, interest and interest on solatium as provided under the 1894 Act, and remanded the matter to the Competent Authority to compute and disburse. **Background worth keeping straight.** Section 3J of the National Highways Act had made the 1894 Act inapplicable to highway acquisitions; it was struck down as violating Article 14 in the first *Tarsem Singh* decision, and a later decision refused to make that operate only prospectively. The Court here was careful about what those decisions do and do not establish: they settle that solatium and interest are payable across the years, including for acquisitions before 2015. They do **not** decide which enactment computes them.

The law behind it

What this means for you

If your land was taken for a national highway, the date that decides how much solatium and interest you get is probably not the date you would guess. It is not the date of the Section 3A notification. It is not the date you were paid. It is not the date the Arbitrator ruled, and it is not the date of any appeal. It is the date the **Competent Authority determined the compensation** under Section 3G(1). Before 1 January 2015 and the 1894 Act governs; not determined by then and the 2013 Act governs, with the considerably more generous First Schedule package. The second thing to take from this is that solatium and interest are payable either way. That was settled when Section 3J was struck down, and this judgment does not touch it. If your award or arbitration simply left solatium and interest out — which happened a great deal while Section 3J was on the books — that is a live claim, not a closed one. The Court here did exactly that: it directed those components be added to an already-determined compensation and sent the matter back for computation. A caution on the Ministry notification. People do try to use clause 4.6(c) to bring older acquisitions under the 2013 Act. It can work, but read it as the Court read it: it speaks of the majority of the *land holdings*, not the majority of *landowners*, and the authority will produce hectare figures to answer it.

What to do

1. **Get the Competent Authority's Section 3G(1) determination and check its date.** This single document decides which Act computes your solatium and interest. Ask for a certified copy if you do not have one. 2. **Check whether solatium, interest and interest on solatium were actually included** in what was awarded to you. For years they often were not, because Section 3J purported to exclude the 1894 Act until the Supreme Court struck it down. 3. **If they were left out, that is your claim.** This judgment remanded the matter to the Competent Authority precisely for that computation and disbursal. 4. **Do not argue from the Arbitrator's date.** The Court has now held the Arbitrator's determination is the analogue of a reference to the civil court, not of the award. It is the Competent Authority's date that counts. 5. **If you want to rely on the Ministry notification**, be ready with figures for the *land holdings* — in hectares — for which compensation was unpaid as on 31 December 2014, not a headcount of landowners. 6. **Land acquisition claims involve limitation and valuation evidence.** Take the papers to a lawyer; if cost is a barrier, the District Legal Services Authority provides free legal aid under the NALSA framework.

Source

Supreme Court of India, Justices J. B. Pardiwala and K. Vinod Chandran, 8 September 2026. Citation: 2026 INSC 973. Read the full judgment .

This explainer was written from the primary judgment text, not from news reports.