While granting relief to certain landowners in a case involving Jhum Land Regulation, 1947, the Supreme Court has observed that to construe ‘reasonable compensation’ narrowly, ignoring ‘solatium’ and ‘interest’, would be to perpetuate inequality. The Apex Court further held that in constitutional jurisprudence, reasonableness of compensation must align with the guarantees of Article 14 and Article 300A.

The Apex Court was considering a set of appeals concerning the legal dissonance between two Statutes providing for land acquisition by the State authorities. The State of Arunachal Pradesh and its Authorities challenged the judgment of a Division Bench of the Gauhati High Court (Itanagar Bench) with respect to the validity of the compensation provided for the acquisition of certain ‘Jhum’ lands, undertaken under the provisions of the Jhum Land Regulation, 1947.

The Division Bench of Justice Surya Kant and Justice Joymalya Bagchi held, “The phrase “reasonable compensation” is an open-textured expression, designed to confer flexibility. It cannot be read as permitting compensation which is merely notional or arbitrary. In constitutional jurisprudence, reasonableness of compensation must align with the guarantees of Article 14 and Article 300A. The right to property, though no longer fundamental, is nonetheless a constitutional right which cannot be divested save by authority of law, and such deprivation must meet tests of fairness and nonarbitrariness.”

“To construe “reasonable compensation” narrowly, ignoring ‘solatium’ and ‘interest’, would be to perpetuate inequality: two landholders losing their property for identical projects — one under the 2013 Act, another under the 1947 Regulations — would stand on palpably different footings, without rational justification. Such a construction would not withstand scrutiny under Article 14”, it added.

Factual Background

The lands of the private respondents were notified to be acquired on February 17, 2014, in a Notification issued under Section 10 of the 1947 Regulations. These lands were sought to be acquired for the purpose of construction of the Trans-Arunachal-Highway (TAH) along the Potin–Bopi (Godak) corridor. The estimates for compensation were drawn and communicated to the relevant landowners. No solatium or additional interest formed part of these calculations. Aggrieved by the same, the respondents made representations before the Deputy Commissioner and the same were negatived by the Authority, citing Section 10 of the 1947 Regulations as a provision which merely necessitates “reasonable compensation”, and no other statutory benefit.

The private respondents thereafter approached the High Court seeking the benefits provided under the 2013 Act’s acquisition mechanism. However, the High Court relegated them to the statutory remedy of appealing before the State Governor, postulated under Section 17 of the 1947 Regulations. The Governor rejected their appeal, holding that since the acquisition was effected under the 1947 Regulations, there would be no applicability of the 2013 Act. The High Court later allowed for the grant of the statutory benefits as prayed for by the respondents. After intra-court appeals were filed, the Division Bench passed the impugned order, indicating that all acquisitions completed under the 1947 Regulations may be reopened for re-determination of their compensation as per the 1894 or the 2013 Act.

Reasoning

The Bench noted that the appeals turned upon the interplay between a pre-constitutional special Regulation, namely, the 1947 Regulations, and the 1894/2013 Acts, with particular reference to the entitlement of claimants to solatium and interest. The Bench explained that the 1947 Regulations are a special law, enacted in exercise of powers conferred under Section 92(2) of the Government of India Act, 1935, in order to safeguard, regulate, and protect the rights of the tribes indigenous to the Balipara/Tirap/Sadiya Frontier Tracts over the ‘Jhum’ lands.

It was further noticed that the 1947 Regulations do not envisage the routine procedure followed under the 1894/2013 Acts, i.e. the issuance of Notification proposing the acquisition; the subsequent Declaration of such acquisition; issuance of notice(s) before passing of an award, etc. “It is this shapeless “reasonable compensation” that has worried the respondents, who sought applicability of the 2013 Act, a decidedly more thorough legislation with determinative elements for the calculation of compensation, including statutory benefits such as solatium and additional interest”, it added.

The Bench concurred with the view of the High Court that “reasonable compensation” in Section 10 must be harmonised with the prevailing legislative standards of the time, and solatium and interest are not alien imports but integral components of fairness. As per the Bench, this interpretive technique properly reflected the principle that subordinate or special legislation must be read in the light of constitutional values and later general enactments, particularly where the language is sufficiently elastic.

The Bench asserted that the Balipara/Tirap/Sadiya Frontier Tract Jhum Land Regulation (Amendment) Act, 2024, namely, Act No. 11 of 11 2024 (which has come into force in the State of Arunachal Pradesh with effect from August 7, 2024) has introduced a proviso to Section 10 explicitly stipulating that compensation under the 1947 Regulations shall not be less than that computed under the law of land acquisition in force at the relevant time. “This amendment confirms, in statutory form, the interpretive conclusion reached by the High Court and supplemented by us. However, as a matter of legislative policy, it operates prospectively and cannot, by itself, justify disturbing concluded acquisitions”, it held.

Thus, the Bench allowed the appeals in part and directed that the respondents shall also be entitled to solatium as well as interest in accordance with the provisions of the 2013 Act. “The appellants shall ensure that any arrears towards solatium and interest, wherever not yet paid, are released to the landowners of the subject-acquisition within a period of three months from today”, it ordered. “In respect of concluded acquisitions where compensation has been finally determined, accepted and disbursed, no reopening shall be permissible. The impugned judgment of the High Court is therefore set aside, to that extent. However, in all matters which remain pending either before the competent authority or before a Court/Tribunal, the compensation shall be recomputed to include solatium and interest as above”, it concluded.

Cause Title: The State of Arunachal Pradesh v. Mihin Laling (Neutral Citation: 2025 INSC 1186)

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Justice Surya KantJustice Joymalya Bagchi

Tulip Kanth

Assistant Editor

Tulip Kanth is an Assistant Editor at Verdictum having over 5 years of experience in the field of legal journalism and editing. She extensively covers judgments of the Supreme Court, High Courts as well as Tribunals. She has previously worked with a legal publishing website where she oversaw the work of other editors and has also created updates on notifications of different Government Ministries. She holds an English Honours Degree from SGTB Khalsa College, Delhi University and has completed her LLB course with specialisation in Corporate Law from Amity University.