Himachal HC directs HPPCL to pay enhanced compensation to Sawra-Kuddu landowners

Shimla, Nov 2,

The Himachal Pradesh High Court has directed the Himachal Pradesh Power Corporation Limited (HPPCL) to pay enhanced compensation to landowners whose properties were purchased through private negotiations for the Sawra-Kuddu Hydro-Electric Project, rejecting the corporation’s objection that their claims were barred by an inordinate delay of more than a decade.

Justice Sandeep Sharma, while disposing of five connected writ petitions on October 28, 2026, held that HPPCL was bound by its undertaking to pay the difference in compensation if the rates awarded by the District Judge in reference proceedings were subsequently enhanced.

The petitions were filed by Jangvir Singh Dulta, Vijay Pal Dulta, Krishan Pal Dulta and others, Satpal Singh Dulta and others, and Man Singh and another, seeking enhanced compensation for their land situated in Hatkoti, Bharot and Ghunsa villages of Jubbal tehsil in Shimla district.

The dispute originated from the acquisition of land for the Sawra-Kuddu Hydro-Electric Project. While the government had issued an acquisition notification in August 2005, the petitioners’ land was subsequently purchased by HPPCL through private negotiations in 2008 and 2009. Sale deeds were executed and the corresponding mutations were subsequently attested.

Also read: 367-day delay in Compensation: HP High Court orders 7.5% Interest on Land Compensation

The crucial aspect of the dispute was an undertaking recorded in a memorandum placed before HPPCL’s Board of Directors, which approved the negotiated purchase arrangement on January 21, 2009.

According to the memorandum, the negotiated rates were to be treated as an ad hoc price, with the project authorities agreeing to pay the difference if the District Judge enhanced compensation in reference cases concerning the respective revenue estates. The undertaking also provided for interest at the rate of 9 per cent per annum from the date possession of the land was handed over to the project authorities until payment.

However, despite subsequent enhancement of compensation by the District Judge in reference proceedings, the landowners did not receive the corresponding difference. They approached the corporation through legal notices in 2024 before eventually moving the High Court.

Opposing the petitions, HPPCL argued that the claims were hit by delay and laches, pointing out that the enhancement orders had been passed around 2015 and the petitioners had approached the court after more than ten years. The corporation also maintained that any enhanced compensation, if payable, should be restricted to the date of the District Judge’s order.

Rejecting these arguments, the High Court observed that once HPPCL had specifically undertaken to pay enhanced compensation following an increase ordered by the reference court, the responsibility to honour that commitment rested with the corporation. The landowners were not required to approach HPPCL afresh or file separate applications seeking release of the enhanced amount, particularly when no such condition was incorporated in the memorandum.

The court also relied upon its earlier judgment in Sat Dev Singh versus State of Himachal Pradesh and others, observing that landowners whose properties had been purchased through private negotiations under similar compensation arrangements were entitled to the benefit of subsequent enhancement.

Referring to the Supreme Court’s Constitution Bench judgment in Sunder versus Union of India (2001), the High Court also took note of the legal position concerning payment of interest on solatium as part of statutory benefits.

In its final directions, the court allowed all five petitions and directed HPPCL to pay the enhanced compensation determined by the District Judge in the reference proceedings, as subsequently modified by the High Court in the relevant appeals, from the date of execution of the sale deeds, along with all statutory benefits.

The judgment reinforces the obligation of government-owned corporations to honour specific commitments made during negotiated land purchases, particularly where compensation parity has been expressly assured to landowners.