Rental or mesne profits arise only upon unlawful occupation: SC


Justices Augustine George Masih and C.R. Gavai on a judgement dated 15 October 2025, Nashik Municipal Corporation v. Landowner partly allowed the appeal challenging the High Court’s decision reducing compensation for land acquisition under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 reiterating that rental or mesne profits arise only upon unlawful occupation.

The dispute concerned 37 Ares of land in Nashik that had been reserved for public purposes under the MRTP Act, 1966, and partially acquired decades earlier. The remaining land was used by the Corporation without formal acquisition. After multiple rounds of litigation, the land was finally acquired in 2017, with the SLAO awarding ₹8.69 crore compensation, later enhanced by the Reference Court to ₹20.20 crore along with ₹238 crore as “rental compensation.” The High Court quashed the enhancement, restoring the SLAO’s award.

Before the Supreme Court, the appellant contended that the High Court erred in rejecting the comparable sale deeds relied on by the Reference Court and that the denial of rental compensation was unjust. The Court agreed partly, holding that under Section 26 of the 2013 Act, the Collector must determine market value based on average sale prices of similar lands and not on ready-reckoner rates. It found the Reference Court’s reliance on six sale instances sound and restored the higher compensation of ₹20.20 crore with 9% interest.

However, the claim of rental compensation was rejected. The Court observed that no evidence showed unlawful possession by the Corporation before the appellant’s purchase in 2011, and the original owner retained control over the property. Relying on R.L. Jain v. DDA (2004) 4 SCC 79, it held that rental or mesne profits arise only upon unlawful occupation. Nevertheless, invoking equitable jurisdiction under Section 28 (“seventhly”), the Court directed the Corporation to pay 8% interest on the purchase amount of ₹1.17 crore for the period between the sale deed and the award.

Accordingly, the appeal was partly allowed. The enhanced compensation was restored, but rental compensation was disallowed. The adverse observations and cost of ₹10 lakh imposed by the High Court were set aside.

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Sources of international Law : Explain

Introduction:

Major sources which form the conventional source of International law includes the International Convention and Treaties. Sources of International Law can be bifurcated into primary and secondary sources which are explained below.

Primary Sources

Primary Sources of International Law are considered formal in nature. They come from official bodies which include Treaties, Customs and principle of Law. Article 38(1)(a-c) of the ICJ statute is widely recognized as the backbone of the formal source of International Law. It is generally regarded as an authoritative statement of the sources of international law. Article 38 of the Statute of the International Court of Justice in The Hague has been treated as a convenient catalogue of international legal sources.

Article 38 of the ICJ statute:

Article 38(1)(a-c) of the ICJ was adopted by the same provision of the statute of the Permanent Court of International Justice which operated under the auspices/support of Legal of Nations in 1920. The article refers to the primary sources of international law which are enumerated below:

Custom as a Source of International Law

The original and the oldest sources Law is known as Custom. The rules of customary International Law involved a long historical process which gained recognition by the entire community. The presence of customary rules can be deduced from state practice and behaviour because it is not a written source of law

Convention as a source of International Law

Treaties and conventions are one of the most important sources of Internationa Law. These conventions can be multilateral or bilateral. Multilateral conventions relate to the treaties which formulate the universal or general application of the law. On the other hand, bilateral conventions are those which is formed exclusively by two states to deal with a particular matter concerning these states.

General Principle of International Law

Most modern jurists accept general principles of law as common to all national legal systems, in so far as they are applicable to the relations of States. There are fewer decided cases in international law than in a municipal system and no method of legislating to provide rules to govern new situations. It is for such a reason that the provision of ‘the general principles of law recognized by civilized nations’ and was inserted into article 38 as a source of law.

Secondary source (Evidence of International law)

Article 38(1)(d) forms part of the material source of International Law also known as the secondary source. It states that judicial decisions and the teachings of the most highly qualified publicists of the various nations also help in guiding the formation of international law, however they are not binding but merely advisory in nature.

Judicial Decision

Under this, the court is authorised to apply previous decisions of the court which are also known as an evidence of international law, however, it is subject to the exception stated under Article 59 of the statute which states that the previous decision of the court can only guide the court, it is not binding on the court. This article provides the court with a rule that it is not to be bounded by precedents but recourse can still be made by the court to its past decision’s res judicata and advisory opinion to substantiate current case as authoritative evidence of legal position.

Juristic writings and teachings

Other major parts of this source also include the ‘teachings of the highly qualified writers such as Gentili, Grotius, and Vattel who were considered as the supreme authorities of the international law in the 16th to 18th Centuries.

Textbooks are used as a method of discovering what the law is on any particular point rather than as the source of actual rules, and the writings of even the most respected international lawyers cannot create law. These are considered as an evidentiary source of law as they provide an explanation and understanding of the International principles. They carry an essential value because they provide to fill the grey areas of International Law where treaties or customs do not exist.


Read also: Sources of Hindu Law in Family Law: Ancient Texts, Customs etc

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