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Issues: Whether interest can be awarded on compensation for acquisition of requisitioned property under the Defence of India Act, 1962 when the Act does not expressly provide for interest.
Analysis: The statutory scheme under sections 36 and 37 of the Defence of India Act, 1962 provides for acquisition of requisitioned property and determination of compensation, but contains no express provision either granting or prohibiting interest. The Court held that the earlier decisions upholding similar acquisition statutes only decided that absence of a provision for solatium or interest did not invalidate the enactments; they did not decide whether interest could be awarded on equitable grounds for delayed payment. Applying the general principle that where compensation is paid belatedly, interest may be awarded unless the statute specifically regulates or bars it, the Court held that increased compensation relates back to the date of acquisition and interest is payable on the enhanced amount from that date. The prolonged delay in payment and the absence of any statutory prohibition supported the award of interest at a reasonable rate.
Conclusion: Interest on the compensation amount was permissible on equitable grounds, and the award of interest at 6% per annum was upheld.
Ratio Decidendi: Where a statute governing acquisition is silent on interest and does not expressly bar it, courts may award interest on delayed compensation, including enhanced compensation, on equitable grounds from the date the compensation became payable.