Court rules compensation for building awarded to petitioner who constructed it, dismissing rival claim by Gurdwara management committee lacking legal locus.
In a significant judgment delivered on October 16, 2026, the Himachal Pradesh High Court, presided over by Mr. Justice Sandeep Sharma, ordered the release of compensation amounting to Rs. 68,32,650/- for a structure acquired by the National Highways Authority of India (NHAI) for the four-laning of National Highway-21. The compensation was awarded in favor of the petitioner, Mr. Yagya Chand, who established that he had constructed the building standing on the acquired land.
The case arose out of acquisition proceedings initiated in 2017 for the Nerchowk to Manali section of the National Highway. The petitioner's house, recorded as structure No. 35 on Khasra No. 4678/1 in Revenue Village Shilihar, was acquired as part of the project. The petitioner submitted evidence such as a certificate from the Panchayat Secretary, a Patwari certificate, electricity bills, and an expert valuer's report confirming that he had constructed the building approximately 4 to 8 years ago.
Despite the supplementary award No. 113/4 dated May 22, 2018, which recognized the petitioner as the rightful claimant for compensation of Rs. 66,66,000 plus additional charges, the amount was withheld due to objections raised by the alleged Managing Committee of Gurdwara Guru Granth Sahib, Bhuntar. The Gurdwara committee claimed ownership over the land and the structure, asserting the building was 60 years old and belonged to it. However, the court noted that the civil suit relied upon by the committee pertained only to land ownership and did not specifically claim or establish rights over the structure.
The High Court examined the legal position under the National Highways Act, 1956, and held that compensation for a superstructure is payable independently to the person who constructed or possessed it, regardless of the title dispute over the underlying land. The petitioner having produced prima facie evidence of his interest and ownership in the building shifted the burden onto the rival claimant, who failed to produce cogent evidence substantiating their claim over the structure.
Further, the court referred to a previous judgment (RSA No. 129 of 1997) which held that the Gurdwara Guru Granth Sahib, Bhuntar, never came into existence as a legal entity under the Sikh Gurdwaras Act, 1925, and accordingly, the alleged Managing Committee lacked legal locus to contest the petitioner's claim. Therefore, the objections raised by the respondent No.4 were dismissed.
Importantly, the Court emphasized the principle laid down by the Supreme Court in Union of India v. Tarsem Singh (2019) that a person whose property is acquired under the National Highways Act cannot be subjected to unfair or discriminatory treatment regarding compensation. The compensation must be just, fair, and released promptly to the rightful claimant.
Consequently, the Court directed the Competent Authority-cum-Collector and the NHAI to release the compensation amount along with accrued interest to the petitioner expeditiously, preferably within three weeks.
This judgment clarifies that in land acquisition cases, disputes over the title of the land do not justify withholding compensation for structures constructed by third parties who can prove their interest. It reinforces the principle that compensation for compulsory acquisition must be fair and accessible to those legally entitled.
Bottom Line:
Land acquisition - Compensation for acquired structure - Where supplementary award records petitioner as person who constructed structure and official record/valuer's report supports such claim, compensation for structure cannot be withheld merely because dispute regarding title of underlying land is pending - Rival claimant having no specific plea or proof of ownership of structure and no legal locus cannot obstruct release of compensation.
Statutory provision(s):
National Highways Act, 1956, Sikh Gurdwaras Act, 1925, Code of Civil Procedure, 1908 (Section 92)
Yagya Chand v. Competent Authority-cum-Collector, (HP) : Law Finder Doc Id # 2998680
