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CASE NO.:

Appeal (civil) 11733-11734 of 1995

PETITIONER:

Ravinder Narain and Anr.

RESPONDENT:

Union of India

DATE OF JUDGMENT: 28/02/2003

BENCH:

DORAISWAMY RAJU & ARIJIT PASAYAT

JUDGMENT:

J U D G M E N T

[With C.A. No. 11735 of 1995]

ARIJIT PASAYAT,J

In these three appeals, the controversy lies within a

very narrow compass relating to the valuation of lands

acquired under the Land Acquisition Act, 1894 (in short 'the

Act').

As the points in issue are common they are dealt with

together. Notifications under Section 4 of the Act were

issued on 13.11.1959 and 15.7.1960 in the two cases. The

acquired lands according to the appellants are situated on

the main road known as the Mall or Delhi Karnal Road near to

National Highway No.1. They claimed Rs.60 per sq. yard along

with interest and solatium. So far as the acquisitions

covered by the Notification dated 13.11.1959 is concerned,

the Land Acquisition Collector divided the acquired land

into two blocks and fixed the market value of land in these

blocks separately. As regards Bagh Nehri land, the rate was

fixed at Rs.4,000/- per bigha and Gair Mumkin land

@Rs.3,500/- per bigha in respect of block A. In respect of

Block B, he fixed the market value of garden land

@Rs,3,500/- per bigha and for other land @Rs.3,000/- per

bigha. So far as the acquisition relating to Notification

dated 15.7.1980 is concerned, the Land Acquisition Collector

fixed the compensation at the flat rate of Rs.3,400/- per

bigha.

References were made under Section 18 of the Act. In

the first case, the reference Court fixed the compensation

at Rs.26,000/- per bigha and in the second case also similar

rate was fixed. Matter was carried in appeals before the

Delhi High Court which by the impugned judgment fixed the

compensation @Rs.30,000/- per bigha. While fixing the value,

references were made to several instances of sale

contemporaneous to the period. The High Court felt that the

residential plots and the shop plots had to be sold at

different rates and their average was worked out to fix the

compensation. The High Court made reference to the instances

cited by the appellants to hold that they related to smaller

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plots and do not provide a reasonable comparison. High

Court also made reference to various data provided by way of

evidence and came to conclude that the total plotable areas

cannot be taken into account and only the plotted areas have

to be reckoned. It was hypothetically noted that if the

total plotable area was 1000 sq.yds, plotted area on the

basis of materials on record, would come to 637 sq. yds. It

also took note of the development charges, miscellaneous

charges on account of brokerage, administration, interest on

investment etc. and worked out the net price to fix the

market value.

Mr. Ashok Desai, learned senior counsel appearing for

the appellants submitted that the High court erred in not

taking note of comparable cases and placed reliance on

instances of sale which cannot be termed to be

contemporaneous. With reference to the location of the

acquired land, it was submitted that the market value as

fixed is certainly on the lower side. Judicial notice can be

taken note of rapid upward trend in prices and, therefore,

for the subsequent notification, higher rates were fixed.

Per contra, Mr. H.L. Agrawala, learned senior counsel

appearing for the respondent submitted that the High Court

made detailed analysis of the factual position and has

rightly fixed the market value. There is no material to

substantiate the plea of upward trend in prices.

Where large area is the subject matter of acquisition,

rate at which small plots are sold cannot be said to be a

safe criteria. Reference in this context may be made to

three decisions of this Court in The Collector of Lakhimpur

v. Bhuban Chandra Dutta (AIR 1971 SC 2015), Prithvi Raj

Taneja (dead) by Lrs. v. The State of Madhya Pradesh and

Anr. (AIR 1977 SC 1560) and Smt. Kausalya Devi Bogra and

Ors. etc. v. Land Acquisition Officer, Aurangabad and Anr.

(AIR 1984 SC 892).

It cannot, however, be laid down as an absolute

proposition that the rates fixed for the small plots cannot

be the basis for fixation of the rate. For example, where

there is no other material it may in appropriate cases be

open to the adjudicating Court to make comparison of the

prices paid for small plots of land. However, in such cases

necessary deductions/adjustments have to be made while

determining the prices.

In the case of Suresh Kumar v. Town Improvement Trust,

Bhopal (1989 (1) SVLR (C) 399) in a case under the Madhya

Pradesh Town Improvement Trust Act, 1960 this Court held

that the rates paid for small parcels of land do not provide

a useful guide for determining the market value of the land

acquired. While determining the market value of the land

acquired it has to be correctly determined and paid so that

there is neither unjust enrichment on the part of the

acquirer nor undue deprivation on the part of the owner. It

is an accepted principle as laid down in the case of

Vyricherla Narayana Gajapatiraju v. Revenue Divisional

Officer, Vizagapatam (AIR 1939 P.C. 98) that the

compensation must be determined by reference to the price

which a willing vendor might reasonably expect to receive

from the willing purchaser. While considering the market

value disinclination of the vendor to part with his land and

the urgent necessity of the purchaser to buy it must alike

be disregarded. Neither must be considered as acting under

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any compulsion. The value of the land is not to be estimated

as its value to the purchaser. But similarly this does not

mean that the fact that some particular purchaser might

desire the land more than others is to be disregarded. The

wish of a particular purchaser, though not his compulsion

may always be taken into consideration for what it is worth.

Section 23 of the Act enumerates the matters to be

considered in determining compensation. The first criteria

to be taken into consideration is the market value of the

land on the date of the publication of the notification

under Section 4(1). Similarly, Section 24 of the Act

enumerates the matters which the Court shall not take into

consideration in determining the compensation. A safeguard

is provided in Section 25 of the Act that the amount of

compensation to be awarded by the Court shall not be less

than the amount awarded by the Collector under Section 11.

Value of the potentiality is to be determined on such

materials as are available and without indulgence in any

fits of imagination. Impracticability of determining the

potential value is writ large in almost all cases. There is

bound to be some amount of guess work involved while

determining the potentiality.

It can be broadly stated that the element of

speculation is reduced to minimum if the underlying

principles of fixation of market value with reference to

comparable sales are made:

(i) when sale is within a reasonable time

of the date of notification under Section

4(1);

(ii) it should be a bona fide transaction;

(iii)it should be of the land acquired or of

the land adjacent to the land acquired; and

(iv) it should possess similar advantages.

It is only when these factors are present, it can merit

a consideration as a comparable case (See The Special Land

Acquisition Officer, Bangalore v. T. Adinarayan Setty (AIR

1959 SC 429).

Keeping the aforesaid principles in view we feel that

on the basis of the instances pressed into service by the

acquiring authority and the land owner-appellants, the

average can be fixed @ Rs.61.50/- for both the

notifications in question by adopting the extent of plotted

area as done by the High Court which appears to be

appropriate in the circumstances of the case. Therefore, the

rate per sq. yard can be fixed @Rs.40/-. Though it was

contended that there was marked variation in price relating

to the instances of sale, vis--vis second notification, it

does not appear, on the basis of evidence on record, that

the fluctuation was of very high magnitude. The marginal

differences noticed do not warrant any higher fixation of

price. The entitlements of the appellants be accordingly

worked out in addition to statutory entitlements, if any.

The appeals are accordingly disposed of. No costs.

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