RFA-639-2025 (O&M) alongwith other 

connected cases --2--

landowners invoking Section 64 of the Right to Fair Compensation and

Transparency in Land Acquisition, Rehabiliation and Resettlement Act,

2013 (for short, “2013 Act”), were partly allowed.

3.  Brief facts of the case are that 132 kanal of land owned by the

appellants-landowners,   situated   in   the   revenue   estate   of   Village

Mohammadpur  Jharsa, Tehsil & District Gurugram, was  sought to be

acquired vide notifications dated 24.12.2013 and 18.12.2014, issued under

Sections 4 & 6, respectively, of the Land Acquisition Act, 1894 (hereinafter

referred to as “1894 Act), for the public purpose, namely, Metro Rail Track

and its allied uses. The Land Acquisition Collector-cum-District Revenue

Officer vide its award dated 13.01.2017, assessed the market value of the

acquired land at the rate of Rs.1,90,00,000/- per acre.

4.  Aggrieved   of   the   same,   the   appellants-landowners   invoked

separate reference petition(s) under Section 64 of the 2013 Act, seeking

enhancement of compensation. Upon consideration of the material available

on record, the Reference Court vide its Award dated 11.04.2025, enhanced

the market value to Rs.2,04,02,826/- per acre besides grant of all other

statutory benefits.

5.  Feeling dissatisfied with the aforesaid Award passed by the ld.

Reference Court, the landowners as well as HSIIDC have preferred their

appeals, details whereof are given at the bottom of the judgment.

6.  Impugning the aforementioned award, learned counsel for the

appellants-landowners submits that the award by the Land Acquisition

Collector-cum-District Revenue Officer, Gurugram  in the present case was

passed   in   exercise   of   powers   under   Section   26   of   the   2013   Act   on

RFA-639-2025 (O&M) alongwith other 

connected cases --3--

13.01.2017 and in such a situation, relying upon clause 1(b) to Section 26

read with  explanation  2 thereof, the compensation was required to be

assessed on the basis of average sale price for similar type of land situated in

the same revenue estate or at best the nearest revenue estate by taking into

account one-half of the total number of sale deeds in which the highest sale

price was mentioned.

6.1 Learned counsel submits that though the ld. Reference Court

took into account the 05 sale deeds pertaining to the same revenue estate of

Village Mohammadpur Jharsa having the highest price/value and calculated

the average sale price, however, wrongly applied deduction of 40% while

observing that such sale instances were of small parcels. While relying upon

the aforementioned statutory provisions i.e. Section 26 of the 2013 Act and

the latest proposition of law made thereupon by the Hon’ble Apex Court in

“Madhya Pardesh Road Development Corporation vs. Vincent Daniel and

Others,  2025 (7) SCC 798” , learned counsel submits that under the new

Land Acquisition Act, no deduction was required to be applied on the

average sale price. He thus, submits that the market value should have been

assessed exclusively on the basis of the average sale price of the highest sale

exemplars as tabulated in paragraph No. 47 of the impugned award and thus,

the  market  value  was  required  to  be  enhanced  accordingly.   No  other

argument has been addressed.

7. On the other hand, learned counsel appearing on behalf of

respondent No.3 submits that in view of the settled proposition of law in

terms of repeated decisions rendered by the Hon’ble Apex Court, the ld.

Reference Court was fully justified in applying the deduction over the

RFA-639-2025 (O&M) alongwith other 

connected cases --4--

average sale price derived from the sale instances tabulated in paragraph No.

47 of the impugned award. In support, learned counsel places reliance upon

the following decisions passed by the Hon’ble Apex Court:-

(i) Kasturi vs. State of Haryana, 2003(1) SCC 354. Relevant paras

14 to 17 are reproduced hereunder:-

“14 On facts and in the light of the legal position emerging from

the various decisions referred to above, it is not possible for us to say

that cut of 20% adopted by the learned Single Judge as affirmed by the

Division Bench in the impugned judgment is wrong or unsustainable. It

appears to us having regard to facts and circumstances of the case that

the High Court has applied cut of 20% as against the normal 1/3

deduction. We find that the High Court was right and justified in doing

so.

15. The decision of Bhagwathula Samanna (supra) does not help

the appellants as the said decision was rendered on the facts of that

case. As already noticed above, the said decision was referred to in

earlier decisions of this Court and distinguished. That was a case of a

fully developed land having all amenities and situated in an

advantageous position. In the context of the facts of that case, in para

11, it is stated thus:-

"The principle of deduction in the land value covered by the

comparable sale is thus adopted in order to arrive at the market value

of the acquired land. In applying the principle it is necessary to

consider all relevant facts. It is not the extent of the area covered under

the acquisition which is the only relevant factor. Even in the vast area

there may be land which is fully developed having all amenities and

situated in an advantageous position. If smaller area within the large

tract is already developed and suitable for building purposes and have

in its vicinity roads, drainage, electricity, communications etc. then the

principle of deduction simply for the reason that it is part of the large

tract acquired, may not be justified."(emphasis supplied)

16. In that case deduction was not given on the ground that even

in the vast area there may be land, which is fully developed having all

amenities and situated in an advantageous position; if smaller area

RFA-639-2025 (O&M) alongwith other 

connected cases --5--

within the large tract is already developed and suitable for building

purposes and have in its vicinity roads, drainage, electricity,

communication, etc., then the principle of deduction simply for the

reason that it is part of the large tract acquired, may not be justified.

17. In the present case the situation is entirely different. The

area acquired is not a small area; it was not developed; may be it had

some advantages; a small portion of the large tract was abutting the

main road; it was also not the case that any smaller area within the

large tract of land acquired was fully developed having all facilities as

in the case of Bhagwathula Samanna (supra). The appellants herein did

not establish that the entire area of 84 acres of land acquired was fully

developed having all the facilities such as roads, drains, sewers, water,

electricity lines and civic amenities. In order to convert the land into

plots for the purpose of construction of residential and commercial

buildings certain area was to be earmarked for the abovementioned

purposes in accordance with the law governing in the matter of

creating layouts in addition to incurring of expenditure for the

development area. Hence the claim of the appellants that there should

have been no deduction out of the compensation amount determined for

the entire area acquired is unsustainable. May be the acquired land

with potentiality for construction of residential and commercial

buildings had some advantages, which aspect is taken note of by the

High Court in giving cut of only 20% as against 1/3 normal

deduction.”

(ii) Kanta Devi and others vs. State of Haryana and another, 2008

AIR (SC)3107. Relevant para 30 is reproduced hereunder:-

“30. The learned Single Judge of the High Court has taken into

consideration the nature of the land sought to be acquired in relying on

Ex.P.6 in assessing the market value thereof and has applied a

deduction of 70% in arriving at the compensation to be awarded to the

claimants in respect of the said lands. The various other documents

which were produced on behalf of the claimants were in respect of the

lands which were similar to the lands forming the subject matter of

Ex.P.6. The learned Single Judge has given reasons for not relying on

RFA-639-2025 (O&M) alongwith other 

connected cases --6--

all the other exemplars in choosing to rely on Ex.P.6 alone. But the rate

of deduction applied appears to be on the high side in relation to the

developmental work involved in making the acquired land suitable for

the purposes for which they were so acquired. The acquired lands are

adjacent to the village abadi which is already developed. Having

regard to the consistent view that a deduction of 1/3rd of the market

value is normal, though a higher deduction is permissible, we are of the

view that deduction of 60% would meet the expenditure towards

developmental charges considering the proximity of the acquired lands

to the areas already developed. 

(iii) Karnataka   Housing   Board   vs.   Land   Acquisition   Officer,

Gadag and others, 2011(2) SCC 246. Relevant para   10 is reproduced

hereunder:-

“10. Evidence shows that the acquired lands were situated within

the municipal limits, though on the outskirts of Gadag-Betegeri within a

distance of  one kilometer from Gadag Railway Station and the bus

stand; and that there were several residential colonies and colleges in

the surrounding areas. Therefore though the lands were agricultural,

they could be classified as lands having urban development potential.

Having regard to the partial access to infrastructural facilities, we are

of the view that a deduction of 40% towards cost of development would

meet the ends of justice. On the facts and circumstances, the cut of 53%

applied by the Reference Court is too high and the cut of 33% applied

by the High Court is low. On applying a cut of 40%, the rate per acre

for the acquired land as on 6.2.1992 would be Rs. 2,95,476/- (rounded

off to Rs. 2,95,500).”

(iv) Maj. Gen. Kapil Mehra and others vs. Union of India and

another, 2015(2) SCC 262. Relevant paras 32 to 41:-

“32. While making one third deduction towards development cost,

the   learned   single   Judge   did   not   keep   in   view   the   two   essential

components   of   deduction   for   development.   Deduction  for   20

RFA-639-2025 (O&M) alongwith other 

connected cases --7--

development   consists   of   two   components:-   firstly,   appropriate

deduction to be made towards the area required to be utilized for

roads, drains and common facilities like parks etc.; secondly, further

deduction to be made towards the cost of development, that is cost of

levelling the land, cost of laying roads and drains, erection of electrical

poles and water lines etc. For deduction of development towards land

and development charges, the nature of development, conditions and

nature of the land, the land required to be set apart under the Building

Rules for roads, sewerage, electricity, parks, water supply etc. and

other relevant circumstances involved are required to be considered. 

33.  In Haryana State Agricultural Market Board And Anr. vs.

Krishan Kumar And Ors., (2011) 15 SCC 297, it was held as under:

“10. It is now well settled that if the value of small developed plots

should be the basis, appropriate deductions will have to be made

therefrom towards the area to be used for roads, drains, and common

facilities like park, open space, etc. Thereafter, further deduction will

have to be made towards the cost of development, that is, the cost of

leveling the land, cost of laying roads and drains, and the cost of

drawing electrical, water and sewer lines.”

34.  Consistent   view   taken   by   this   Court   is   that   one   third

deduction is made towards the area to be used for roads, drains, and

other facilities, subject to certain variations depending upon its nature,

location, extent and development around the area. Further, appropriate

deduction   needs   to   be   made   for   development   cost,   laying   roads,

erection of electricity lines depending upon the location of the 21

acquired land and the development that has taken place around the

area.

35.  Reiterating   the   rule   of   one   third   deduction   towards

development, in Sabhia Mohammed Yusuf Abdul Hamid Mulla (Dead)

by Lrs. and Ors. vs. Special Land Acquisition Officer and Ors., (2012)

7 SCC 595, this Court in paragraph 19 held as under:- “19. In fixing

the   market   value   of   the   acquired   land,   which   is   undeveloped   or

underdeveloped, the courts have generally approved deduction of 1/3rd

of   the   market   value   towards   development   cost   except  when   no

development is required to be made for implementation of the public

purpose for which land in acquired. In Kasturi vs. State of Haryana

RFA-639-2025 (O&M) alongwith other 

connected cases --8--

(2003) 1 SCC 354) the Court held: (SCC pp. 359-60, para 7) “7… It is

well settled that in respect of agricultural land or undeveloped land

which   has   potential   value   for   housing   or   commercial  purposes,

normally 1/3rd amount of compensation has to be deducted out of the

amount  of  compensation  payable   on   the   acquired   land  subject  to

certain   variations   depending   on   its   nature,   location,   extent   of

expenditure involved for development and the area required for road

and other civic amenities to develop the land so as to make the plots for

residential or commercial purposes. A land may be plain or uneven, the

soil of the land may be soft or hard bearing on the foundation for the

purpose of making construction; may be the land is situated in the

midst of a developed area all around but that land may have a hillock

or may be low-lying or may be having deep ditches. So the amount of

expenses that may be incurred in developing the area also varies. A

claimant who claims that his land is fully developed and nothing more

is required to be done for developmental purposes, must show on the

basis of evidence that it is such a land and it is so located. In the

absence of such evidence, merely saying that the area adjoining his

land is a developed area, is not enough, particularly when the extent of

the acquired land is large and even if a small portion of the land is

abutting the main road in the developed area, does not give the land the

character or a developed area. In 84 acres of land acquired even if one

portion on one sides abuts the main road, the remaining large area

where planned development is required, needs laying of internal roads,

drainage, sewer, water, electricity lines, providing civic amenities, etc.

However, in cases of some land where there 22 are certain advantages

by virtue of the developed area around, it may help in reducing the

percentage of cut to be applied, as the developmental charges required

may be less on that account. There may be various factual factors

which may have to be taken into consideration while applying the cut in

payment of compensation towards developmental charges, may be in

some cases it is more than 1/3rd and in some cases less than 1/3rd. It

must be remembered that there is difference between a developed area

and an area having potential value, which is yet to be developed. The

fact that an area is developed or adjacent to a developed area will not

ipso facto make every land situated in the area also developed to be

RFA-639-2025 (O&M) alongwith other 

connected cases --9--

valued as a building site or plot, particularly when vast tracts are

acquired,   as   in   this   case,   for   development   purpose.”   (emphasis

supplied)   The   rule   of   1/3rd   deduction   was   reiterated   in   Tejumal

Bhojwani v. State of U.P. ((2003)10 SCC 525, V. Hanumantha Reddy v.

Land Acquisition Officer, (2003) 12 SCC 642, H.P. Housing Board v.

Bharat S. Negi (2004) 2 SCC 184 and Kiran Tandon v. Allahabad

Development Authority. (2004)10 SCC 745”

36.  While determining the market value of the acquired land,

normally one third deduction i.e. 331/3% towards development charges

is allowed. One third deduction towards development was allowed in

Special Tehsildar, L.A. Vishakapatnam vs. Smt.A. Mangala Gowri,

(1991) 4 SCC 218; Gulzara Singh & Ors. vs. State of Punjab & Ors.,

(1993) 4 SCC 245; Santosh Kumari & Ors. vs. State of Haryana,

(1996) 10 SCC 631; Revenue Divisional Officer-cum-LAO vs. Shaik

Azam Saheb etc., (2009) 4 SCC 395; A.P. Housing Board vs. K.

Manohar  Reddy,  (2010)12  SCC  707;   Ashrafi  &  Ors.  vs. State   of

Haryana & Ors., (2013) 5 SCC 527 and Kashmir Singh vs. State of

Haryana & Ors., (2014) 2 SCC 165.

37.  Depending on nature and location of the acquired land, 23

extent of land required to be set apart and expenses involved for

development, 30% to 50% deduction towards development was allowed

in Haryana State Agricultural Market Board and Anr. vs. Krishan

Kumar and Ors. (2011) 15 SCC 297; Deputy Director Land Acquisition

vs. Malla Atchinaidua And Ors. AIR 2007 SC 740; Mummidi Apparao

(Dead by LR) vs. Nagarjuna Fertilizers & Chemical Ltd., AIR 2009 SC

1506; and Lal Chand vs. Union of India and Anr. (2009) 15 SCC 769.

38.  In few other cases, deduction of more than 50% was upheld.

In the facts and circumstances of the case in Basavva (Smt.) And Ors. v.

Spl. Land Acquisition Officer And Ors., (1996) 9 SCC 640, this Court

upheld the deduction of 65%. In Kanta Devi & Ors. vs. State of

Haryana And Anr., (2008) 15 SCC 201, deduction of 60% towards

development charges was held to be legal. This Court in Subh Ram &

Ors.   vs.  State  of  Haryana  &   Anr.,  (2010)  1  SCC  444,  held   that

deduction   of   67%   amount   was   not   improper.   Similarly,   in

Chandrasekhar (dead) by L.Rs. and Ors. vs. LAO & Anr., (2012) 1 SCC

390, deduction of 70% was upheld.

RFA-639-2025 (O&M) alongwith other 

connected cases --10--

39.  We have referred to various decisions of this Court on

deduction towards development to stress upon the point that deduction

towards development depends upon the nature and location of the

acquired land. The deduction includes components of 24 land required

to be set apart under the building rules for roads, sewage, electricity,

parks   and   other   common   facilities   and   also   deduction   towards

development charges like laying of roads, construction of sewerage.

40.  Rule of one third deduction towards development appears to

be the general rule. But so far as Delhi Development Authority is

concerned, or similar statutory authorities, where well planned layouts

are put in place, larger land area may be utilized for forming layout,

roads, parks and other common amenities. Percentage of deduction for

development of land to be made in DDA or similar statutory authorities

with reference to various types of layout was succinctly considered by

this Court in Lal Chand vs. Union of India & Anr. (2009) 15 SCC 769

and observing that the deduction towards the development range from

20% to 75% of the price of the plots, in paras 13 to 22, this Court held

as under:-

“13. The percentage of “deduction for development” to be

made   to   arrive   at   the   market   value   of   large   tracts  of

undeveloped   agricultural   land   (with   potential   for

development),   with   reference   to   the   sale   price   of   small

developed plots, varies between 20% to 75% of the price of

such developed plots, the percentage depending upon the

nature of development of the layout in which the exemplar

plots are situated.

14.   The   “deduction   for   development”   consists   of   two

components. The first is with reference to the area required

to be utilized for developmental works and the second is the

cost of the development works. For example, if a residential

layout is formed by DDA or similar statutory authority, it

may utilize around 40% of the land area in the layout, for

roads,   drains,   parks,   playgrounds   and   civic   amenities

(community facilities), etc.

15.  The   development   authority   will   also   incur

considerable 25 expenditure for development of undeveloped

land into a developed layout, which includes the cost of

leveling   the   land,   cost   of   providing   roads,   underground

drainage and sewage facilities, laying water lines, electricity

lines   and   developing   parks   ands   civil   amenities,   which

would be about 35% of the value of the developed plot. The

two factors taken  together would  be the “deduction for

development” and can account for as much as 75% of the

cost of the developed plot.

16.  On the other hand, if the residential plot is in an

RFA-639-2025 (O&M) alongwith other 

connected cases --11--

unauthorized private residential layout, the percentage of

“deduction   for   development”   may   be   far   less.   This   is

because in an unauthorized layout, usually no land will be

set apart for parks, playgrounds and community facilities.

Even if any land is set apart, it is likely to be minimal. The

roads and drains will also be narrower, just adequate for

movement of vehicles. The amount spent on development

work would also be comparatively less and minimal. Thus

the deduction on account of the two factors in respect of

plots in unauthorized layouts, would be only about 20% plus

20% in all 40% as against 75% in regard to DDA plots.

17.  The “deduction for development” with reference

to prices of plots in authorized private residential layouts

may   range   between   50%   to   65%   depending   upon   the

standards and quality of the layout.

18.  The position with reference to industrial layouts

will be different. As the industrial plots will be large (say of

the size of one or two acres or more as contrasted with the

size of residential plots measuring 100 sq. m to 200 sq m),

and as there will be very limited civic amenities and no

playgrounds, the area to be set apart for development (for

roads, parks, playgrounds and civic amenities) will be far

less; and the cost to be incurred for development will also be

marginally less, with the result the deduction to be made

from the cost of an industrial plot may range only between

45% to 55% as contrasted from 65% to 75% for residential

plots.

19.  If the acquired land is in a semi-developed urban

area, and not an undeveloped rural area, then the deduction

for development may be as much less, that is, as little as

25% to 40%, as some basic infrastructure will already be

available.   (Note:   The   percentages   mentioned   above   are

tentative standards and subject to proof to the contrary.

20. Therefore the deduction for the “development factor” to

be made with reference to the price of a small plot in a

developed layout, to arrive at the cost of undeveloped land,

will be far more than the deduction with reference to the

price of a small plot in an unauthorized private layout or an

industrial layout. It is also well known that the development

cost incurred by statutory agencies is much higher than the

cost incurred by private developers, having regard to higher

overheads and expenditure. 

21. Even among the layouts formed by DDA, the percentage

of   land   utilized   for   roads,   civic   amenities,   parks  and

playgrounds may vary with reference to the nature of layout-

whether it is residential , residential-cum-commercial or

industrial;   and   even   among   residential   layouts,   the

percentage will differ having regard to the size of the plots,

width of the roads, extent of community facilities, parks and

playgrounds provided.

22. Some of the layouts formed by the statutory development

authorities   may   have   large   areas   earmarked   for

water/sewage   treatment   plants,   water   tanks,   electrical

substations, etc. in addition to the usual areas earmarked for

RFA-639-2025 (O&M) alongwith other 

connected cases --12--

roads,   drains,   parks   playgrounds   and   community/civic

amenities. The purpose of the aforesaid examples is only to

show   that   the   “deduction   for   development”   factor   is  a

variable percentage and the range of percentage itself being

very wide from 20% to 75%.” Lal Chand’s case deals with

acquisition of lands by DDA under the Rohini Residential

Housing Scheme where 40% deduction was made towards

the land area to be utilized for laying down of roads, drains

etc. Further deduction of 35% of the value of the developed

plot towards cost of levelling the land, cost of providing

roads,   underground   drainage,   laying   down   water   lines,

electricity lines was made.

41.  In the instant case, having regard to the extent of the land

acquired and the development in and around Vasant Kunj area, in our

view, it is appropriate to make 35% deduction towards utilization of the

land area in the layout for roads, drains, parks, playgrounds and civic

amenities. So far as the expenditure for development of the large extent

of   land   into   a   developed   area   by   construction   of   proper   roads,

underground drainage, sewerage and erection of electricity 27 lines, it

is appropriate to make further deduction of 25%, though 35% of the

value was deducted in Lal Chand case (supra) towards development

charges. Two components taken together, the total deduction to be

made would be 60%. 60% of Rs.35,937/- works out to Rs.21,562/- and

deducting the same, the value of the land would be Rs.14,375/- per sq.

yard. What was awarded by the High Court was Rs.14,974/- per sq.

yard. Since the SLP (Civil) No.15272/2011 filed by DDA was dismissed

by this Court on 12.5.2011 and the sale has become final as against the

appellants, we are not inclined to further reduce the value of the

acquired land from Rs.14,974/- per sq. yard as determined by the High

Court and the compensation awarded by the High Court at Rs.14974/-

per sq. yard is maintained.”

(v) Madhukar   s/o   Govindrao   Kamble   &   ors.   v.   Vidarbha

Irrigation Development Corporation and others, 2022(1) RCR(Civil) 820.

Relevant para 11 is reproduced hereunder:-

“11. The evidence produced by the landowners is that the acquired

land is close to Educational Institutions, Banks, Tahsil Office etc.

whereas there is no evidence that the irrigated agricultural land has the

potential of use for either residential or commercial purposes. It is not

RFA-639-2025 (O&M) alongwith other 

connected cases --13--

the nature of land which alone is determinative of the market value of

the land. The market value must be determined keeping in view the

various factors including proximity to the developed area and the road

etc. As per the evidence led by the landowners, the land acquired is ½

km from the road. The land is close to developed residential or

commercial or institutional area. On the other hand, there is no

evidence that Exh.31 and Exh.32 are in any way comparable to the

land acquired. The High Court has erred in law in holding that since

the land of the sale exemplars Exh.31 and Exh.32 is of irrigated

agricultural land whereas the land acquired is unirrigated, is not the

reasonable yardstick to determine market value of the land as the land

in question is close to already developed area.” 

7.1 Learned counsel also points out that in the given facts and

circumstances, the deduction applied @ 40% was on the lower side and

considering the small area forming part of the sale exemplars relied upon by

the ld. Reference Court, cut at the rate of at least 50% was required to be

made and moreso, appropriate additional deduction towards the development

costs was also to be applied.

7.2 Learned counsel further points out that the ld. Reference Court

failed to take into account sale deeds Ex.R-1 to Ex.R-4, which were proved

on record by the respondents-department. He submits that all the 04 sale

exemplars Ex.R-1 to Ex.R-4 were pertaining to the same revenue estate of

village Mohammadpur Jharsa and related to the period prior to the issuance

of notification under Section 4 of the 1894 Act (i.e. 24.12.2013) and the

average price per acre was approximately @ Rs.1 crore. He thus, contends

that no further enhancement towards market value was required to be

granted in favour of the appellants-landowners as the Land Acquisition

Collector in exercise of powers under Section 26 of the 2013 Act already

RFA-639-2025 (O&M) alongwith other 

connected cases --14--

granted much more beyond the aforesaid average price. Learned counsel

thus, submits that the impugned award is liable to be set aside. No other

argument has been addressed

8. I have heard learned counsel for the parties and gone through

the paper book. 

8.1 At the outset, it may be noticed here that no merit can be found

in the submissions made on behalf of the learned counsel appearing on

behalf of the respondents-department as regards the reliance been placed

upon the sale exemplars Ex.R-1 to Ex.R-4 for two reasons. Firstly, a perusal

of the award dated 13.01.2017 passed by the District Revenue Officer-cum-

Land Acquisition Collector, Gurugram, whereby the market value of the

acquired land was assessed at rate of Rs.1,90,00,000/- per acre, relies upon

the price fixation made by the District Collector, Guguram. Thus, in such

circumstances, the sale exemplar carrying price lesser than the rate fixed by

the District Collector, Gurugram cannot be treated to be bonafide or genuine

sale transactions. Relevant clause 4 of the award dated 13.01.2017 passed by

the District Revenue Officer-cum-Land Acquisition Collector, Gurugram in

exercise of powers under 26 of the 2013 Act is extracted hereunder:-

“4.In order to arrive at a conclusion about the market vlaue of

the land under acquisition. I have visited the land under acquisition

and taken into consideration its location and potentiality. To fix the

market value the Haryana Government has constituted a Divisional

level Land Rate Fixation Committee under the Chairmanship of the

concerned Commissioner of the Division which has been dissolved by

the Haryana Govt. Vide notification No.1917-R-5-2014/15193 dated

12.11.2014. Now the District Collector, Gurugram has fixed the rate of

land as per under Section 27 of the said Act. The District Collector,

Gurugram was requested for fixation of rate of land vide letter No.1570

RFA-639-2025 (O&M) alongwith other 

connected cases --15--

dated   28.03.2016   to   supply   the   market   value/price   of   land   under

acquisition. The rate was fixed by Ld. District Collector, Gurugra at

Rs.1,90,00,000/- (One Crore Ninety Lac only) per acre for all kinds of

land vide letter No.6409/DRA dated 05.12.2016.

Keeping in view, the above discuisson and market rate intimated by

the Ld. District Collector, Gurugram. I have come to the conclusion

that the rates fixed by the District level Land Rates Fixation Committee,

Gurugram are just and fair, So, I award the same accordingly.”

8.2 Secondly, as per the settled law and now even from the intent of

the Legislature which flows from Section 26 of the 2013 Act, in case of

determination of market value on the basis of sale deeds of similar type of

land, the average sale price of the highest sale exemplar has to be taken into

account. Thus, the sale instances referred to by the respondents-department

in the form of Ex.R-1 to Ex.Ex.R-4 not being the highest of the sale

exemplars were rightly and correctly discarded by the ld. Reference Court.

9. Further, before delving  upon the issue of deduction applied by

the ld. Reference Court @ 40% of the average sale price derived from the

sale exemplars tabulated in para 47 of the impugned award, it may be

necessary to recaptulate Section 26 of the 2013 Act.

“26. Determination of market value of land by Collector.–(1) The

“Collector   shall   adopt   the   following   criteria”  in   assessing   and

determining the market value of the land, namely:—

 (a)  the market value, if any, specified in the Indian Stamp Act,

1899 (2 of 1899) for the registration of sale deeds or agreements to

sell, as the case may be, in the area, where the land is situated; or 

(b)  the average sale price for similar type of land situated in the

nearest village or nearest vicinity area; or 

(c)  consented amount of compensation as agreed upon under

sub-section (2) of section 2 in case of acquisition of lands for private

companies or for public private partnership projects, whichever is

RFA-639-2025 (O&M) alongwith other 

connected cases --16--

higher:

Provided that the date for determination of market value shall be the

date on which the notification has been issued under section 11.

Explanation 1.—The average sale price referred to in clause (b) shall

be determined taking into account the sale deeds or the agreements to

sell registered for similar type of area in the near village or near

vicinity area during immediately preceding three years of the year in

which such acquisition of land is proposed to be made.

Explanation 2.—For determining the average sale price referred to in

Explanation  1, one-half of the  total number of  sale deeds or the

agreements to sell in which the highest sale price has been mentioned

shall be taken into account. 

Explanation 3.—While determining the market value under this section

and the average sale price referred to in Explanation 1 or Explanation

2,   any   price   paid   as   compensation   for   land   acquired  under   the

provisions of this Act on an earlier occasion in the district shall not be

taken into consideration. 

Explanation 4.—While determining the market value under this section

and the average sale price referred to in Explanation 1 or Explanation

2, any price paid, which in the opinion of the Collector is not indicative

of actual prevailing market value may be discounted for the purposes of

calculating market value. 

(2)  The market value calculated as per sub-section (1) shall be

multiplied by a factor to be specified in the First Schedule.

(3)  Where the market value under sub-section (1) or sub-section

(2) cannot be determined for the reason that—

(a) the land is situated in such area where the transactions in

land are restricted by or under any other law for the time being in force

in that area; or 

(b) the registered sale deeds or agreements to sell as mentioned

in clause (a) of sub-section (1) for similar land are not available for the

immediately preceding three years; or 

(c) the market value has not been specified under the Indian

Stamp Act, 1899 (2 of 1899) by the appropriate authority,

the   State   Government   concerned   shall   specify   the   floor   price   or

minimum price per unit area of the said land based on the price

RFA-639-2025 (O&M) alongwith other 

connected cases --17--

calculated in the manner specified in sub-section (1) in respect of

similar types of land situated in the immediate adjoining areas: 

Provided that in a case where the Requiring Body offers its

shares to the owners of the lands (whose lands have been acquired) as

a part compensation, for acquisition of land, such shares in no case

shall exceed twenty-five per cent, of the value so calculated under sub-

section (1) or sub-section (2) or sub-section (3) as the case may be: 

Provided further that the Requiring Body shall in no case

compel any owner of the land (whose land has been acquired) to take

its shares, the value of which is deductible in the value of the land

calculated under sub-section (1): 

Provided also that the Collector shall, before initiation of

any land acquisition proceedings in any area, take all necessary steps

to revise and update the market value of the land on the basis of the

prevalent market rate in that area: 

Provided also that the appropriate Government shall ensure

that   the   market   value   determined   for   acquisition   of  any   land   or

property of an educational institution established and administered by

a religious or linguistic minority shall be such as would not restrict or

abrogate the right to establish and administer educational institutions

of their choice.”

A perusal of the aforesaid statutory provision makes it evident

that for the purpose of determination of the market value of the acquired

land while relying upon the sale deeds of the land situated either in the same

revenue estate or in the nearest vicinity, the average sale price of  half of the

sale deeds carrying the highest sale price needs to be taken into account.

Section 26(1)(b) read with explanation 2, nowhere talks about any deduction

to   be   imposed   upon   such   average   sale   price.   However,   in   terms   of

explanation 4 to Section 26(1), any price paid, which in the opinion of the

Collector   is   not   indicative   of   actual   prevailing   market   value   can   be

discounted for the purposes of calculating the market value. 

RFA-639-2025 (O&M) alongwith other 

connected cases --18--

10. Even, the Hon’ble Supreme Court in  Vincent Daniel’s case

(supra), upon detailed comparison of Section 23 of the 1894 Act with

Section 26 of the 2013 Act, has went on to hold that the theory of deduction

need not be applied unless any opinion was expressed by the Collector

indicating that any deduction or discount was to be applied for the purpose

of calculating the market value upon the average sale price. Relevant para 41

is extracted hereunder:-

“41.   In   view   of   the   above-stated   reasons,   we   hold   that   the

compensation has been calculated in accordance with the mandate of

the Acquisition Act, 2013. Thus, no reduction in the amount can be

granted by applying the theory of deduction. It has been left to the

Collector's   discretion   to   make   adjustments   to   the   market   value

determined through Section 26(1), if deemed necessary in the opinion

of the Collector. In the facts of the present case, there was no such

formation   of   opinion   by   the   Competent   Authority   or  the

Commissioner.” 

11. In the given facts, no evidence has been pointed out by the

learned counsel for the respondents-Department to show that any opinion

was ever expressed by the Collector about any suspicion regarding the price

paid under the sale instances tabulated in para 47 of the  impunged award.

No material has been placed on record to support any such kind of belief

concluded by the Collector indicating that the average sale price derived

from the sale consideration of the sale exemplars forming part of paragraph

No. 47 of the impugned award did not indicate the actual prevailing market

value; and accordingly, no deduction over the average price derived by the

ld. Reference Court was permissible. As such, the reliance placed upon by

the learned counsel for the respondents-department to the judgments in cases

RFA-639-2025 (O&M) alongwith other 

connected cases --19--

of  Kasturi’s  case;  Kanta Devi’s  case;  Karnataka Housing Board’s  case;

Maj. Gen. Kapil Mehra’s case and Madhukar’s case (supra), in the most

humble and respectful opinion of this Court was thus misplaced as the said

judgments relate to the provisions of the   1894 Act and not under the

provisions of 2013 Act. 

12. Be that as it may, in the present  case, the average sale price

was derived by the ld. Reference Court while relying upon the five sale

instances as tabulated in para no.47 of the impugned award. A perusal

thereof shows that the area forming part of the said five sale instances range

between 4 kanals to 27 kanals and as such, the same cannot be said to be of

sale exemplars pertaining to small parcels, in comparison to the total land

acquired in the present case being 132 kanals. Moreover, as per the law laid

down by the Hon’ble Apex Court in terms of the provisions of 1894 Act, for

the purpose of determination of market value of the acquired land on the

basis of sale examplers, the sale instances fetching highest market price need

to be taken into account and in case those pertain to small parcel of land,

appropriate cut towards smallness of area in comparison to the are acquired

has to be applied depending upon each case. However, in the case in hand,

the acquisition proceedings have been carried out under the provisions of

2013 Act while taking into account the parameters laid down under Section

26 thereof and already an average of the five highest sale deeds has been

made the basis, rather than taking into account only the top highest of the

sale instance. As such, the effect of smallness of area involved in the sale

examplers, if any, has already been accounted for by taking average the sale

price of five highest sale examplers and thus, rights of the respondents have

RFA-639-2025 (O&M) alongwith other 

connected cases --20--

been taken care of in all respects.

12.1 Furthermore, as the land in this case was acquired for the

purpose of laying down of Metro Rail Track and its allied uses, the

respondents were not going to incur any loss of land or cost/expenditure

towards providing of additional infrastructural amenities for the ultimate

beneficiaries and thus, in such circumstances, the ld. Reference Court went

wrong while having applied the deduction of 40% over the average sale

price derived from the sale exemplars tabulated in para 47 of the impugned

award, whereas, at best a deduction of 10% was required to be applied in the

given facts and circumstances while taking into account the factor of

optimum utilization of land by the respondents and the beneficiary.

13.  Accordingly, in the light of discussion made herein above, the

appellants-landowners   shall   be   entitled   for   award   of   market   value   @

Rs.3,06,04,239/- per acre as per the average price derived from the sale

examplers mentioned in para 47 of the impugned award followed by 10%

deduction thereupon along with all other statutory benefits and interest as

provided under the 2013 Act.

14.  In view of the aforesaid discussion, the appeals filed at the

instance of landowners are partly allowed, whereas, the cross-appeals filed

at the instance of HSIIDC are hereby dismissed.

15.  Further, in case of unfortunate demise of any of the appellants-

landowners, if the legal heir(s)-legal representative(s) have not been brought

on record, they shall be entitled for filing exemption applications in their

own names being legal heirs or legal representatives of the deceased-

landowners; subject of course to any testamentary document created by the

RFA-639-2025 (O&M) alongwith other 

connected cases --21--

deceased.

16.  Pending application, if any, also stands disposed of.

28.10.2025      (HARKESH MANUJA)

sonika  JUDGE

Whether speaking/reasoned: Yes/No

Whether reportable: Yes/ No

Sr. No. Case No.

1. RFA-639-2025 (O&M)

2 RFA-642-2025 (O&M)

3. RFA-650-2025 (O&M)

4. RFA-651-2025 (O&M)

5 RFA-652-2025 (O&M)

6. RFA-653-2025 (O&M)

7 RFA-668-2025 (O&M)

8 RFA-670-2025 (O&M)

9 RFA-675-2025 (O&M)

10 RFA-686-2025 (O&M)

11 RFA-763-2025 (O&M)

12 RFA-772-2025 (O&M)

13 RFA-687-2025 (O&M)

14 RFA-688-2025 (O&M)

15 RFA-689-2025 (O&M)

16 RFA-690-2025 (O&M)

17 RFA-691-2025 (O&M)

18 RFA-692-2025 (O&M)

19 RFA-693-2025 (O&M)

20 RFA-694-2025 (O&M)

21 RFA-695-2025 (O&M)

22 RFA-696-2025 (O&M)

23 RFA-697-2025 (O&M)

24 RFA-698-2025 (O&M)

25 RFA-699-2025 (O&M)

26 RFA-700-2025 (O&M)

27 RFA-701-2025 (O&M)

     (HARKESH MANUJA)

JUDGE

28.10.2025

sonika