REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. __2385_ OF 2009
ARISING OUT OF
SPECIAL LEAVE PETITION (CIVIL) NO. 14209 OF 2006
MOHAMMAD RAOFUDDIN ... APPELLANT
VERSUS
THE LAND ACQUISITION OFFICER ... RESPONDENT
JUDGMENT
D.K. JAIN, J.
Leave granted.
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2. Challenge in this appeal by the claimant-land owner is to the
judgment and order dated 16th September, 2004 rendered by
the High Court of Judicature Andhra Pradesh at Hyderabad in
A.S. No. 1472 of 1999 filed under Section 54 of the Land
Acquisition Act, 1894 (hereinafter referred to as “the Act”) for
enhancement of the amount of compensation. By the
impugned judgment, the High Court has affirmed the award
made by the Reference Court, Medak in O.P. No.25 of 1993
dated 31st December, 1998 and dismissed the appeal
preferred by the appellant.
3. Lands measuring 4 acres 2 guntas situated in Survey No. 434,
Manthoor village of Pulkal Mandal in Medak District of Andhra
Pradesh were acquired for a public purpose, namely for
submergence under the Singnoor project by issuing a
Notification under Section 4 (1) of the Act on 15th July, 1987.
The possession of the land was taken on 19th November,
1987. Pursuant to the notice issued under Section 9 of the
Act, the appellant filed a statement claiming compensation for
the land at Rs.25/- per square yard. An additional amount at
the rate of Rs.5,000/- per year was claimed as damages on
account of “ill” dispossession by the government. After
following the requisite procedure, the Land Acquisition Officer
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made an award on 18th March, 1989, fixing the compensation
at the rate of Rs.9,000/- per acre.
4. Being aggrieved by the award, the appellant sought a
reference under Section 18 of the Act for enhancement of
compensation. According to the appellant, the village in which
his land is located was fully developed and on the date of
Notification, the market value of similar land, meant for house
sites, was not less than Rs.35/- per square yard. Upon
appreciation of the material available on record, the reference
Court fixed the market value of the acquired land at
Rs.20,000/- per acre i.e., an additional amount of Rs.11,000/-
over and above what had been awarded by the Land
Acquisition Officer, alongwith the statutory benefits, viz. 30%
solatium on the enhanced amount of compensation; interest
at 9% per annum for one year from 18th March, 1989, i.e., date
of passing award; interest at 15% per annum after one year of
passing of award till the date of realization and additional
interest at 12% per annum from 18th July, 1987 to 18th March,
1989.
5. Being not satisfied, the appellant preferred an appeal to the
High Court seeking enhancement of compensation at the rate
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of Rs.35/- per square yard. Relying on Ex. A.6, an order of the
Reference Court in another O.P. No. 112 of 1987, in respect
of land approximately 100 yards away, which was acquired for
the same purpose vide Section 4 (1) Notification dated 31st
August, 1985, i.e., nearly two years before the acquisition of
the subject land whereunder compensation was paid at the
rate of Rs.18/- per square yard, the stand of the appellant
before the High Court was that the minimum amount of
compensation had to be at the rate of Rs.18/- per square
yard. As noted earlier, by reason of the impugned order, the
High Court has dismissed the appeal, maintaining the amount
of compensation determined by the Reference Court. Dealing
with the evidence adduced by the appellant, in particular, Ex.
A6, the High Court observed as follows:
“Admittedly, the lands that were acquired leading to the
judgment of the Reference Court under Exs. A.6 and A.7
are not situated in the same village. The lands that are
acquired thereunder were situated in Seripeddareddy
Village. However, according to the appellant, the distance
between the lands acquired leading to the judgment under
Ex. A.6 and the acquired lands are at a distance of just
about hundred yards. The lands are contiguous to each
other. It is unnecessary to further dilate on this subject in
view of the decision of this court in A.S. No. 2336 of 1998
wherein this court confirmed the judgment of the Senior
Civil Judge, Medak in O.P. No. 109 of 1987 dated
7.10.1997 whereunder compensation has been awarded
at the rate of Rs.8,300 per acre. In the said O.P., an
extent of Ac.3.09 1/3 guntas of land belonging to the
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claimants therein situated at the same Manthoor Village
which was acquired for the very same public purpose of
construction of Singnoor Project under the draft
Notification dated 4.1.1987. This court assessed the
market value of the acquired land therein at the rate of
Rs.8,300 per acre. The Notification in this case was
published on 15.7.1987. In such view of the matter, it is
not possible and permissible to take a different view other
than the one taken by this court in A.S. No. 2336 of 1998.
For the aforesaid reasons, we find no merit in this appeal
and the same shall accordingly stand dismissed without
costs. The appellant however shall be entitled to payment
of interest on 30% solatium, apart from other statutory
benefits that were already granted by the Reference
Court.”
6. Thus, the High Court preferred to rely on its earlier judgment
and declined to rely on Ex. A.6, heavily relied upon by the
appellant-land owner in support of his claim. Aggrieved, the
claimant-land owner is before us.
7. Learned counsel appearing for the appellant submitted that
the Reference Court as well as the High Court erred in
ignoring a decree of the Court (Ex. A.6) which was tendered in
evidence by the appellant. It was pointed out that appellant’s
land was acquired at the rate of Rs.9,000/- per acre whereas
in respect of another strip of land situated only 100 yards
away from his land, acquired about two years back,
compensation was paid at the rate of Rs.18/- per square yard.
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In support of the proposition that a judgment of the Court in a
land acquisition case, determining the market value of a land
in the vicinity of the acquired lands, even though not inter
partes, could be admitted in evidence either as an instance or
one from which the market value of the acquired land could be
deduced or inferred, reliance was placed on a decision of this
Court in Pal Singh & Ors. Vs. Union Territory of
Chandigarh1. Learned counsel strenuously urged that before
relying on its earlier decision, the High Court also failed to
ascertain whether there was any similarity between the land,
subject matter of A.S. 2336 of 1998 and the present suit
lands. Learned Senior Counsel appearing on behalf of the
respondent, on the other hand, supported the view taken by
the High Court.
8. Before we enter into the merits of the case, we may note a
few broad principles to be kept in view while determining the
amount of compensation payable on acquisition of land for a
public purpose.
9. Section 15 of the Act mandates that in determining the
amount of compensation, the Collector shall be guided by the
provisions contained in Sections 23 and 24 of the Act.
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(1992) 4 SCC 400
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Section 23 contains the list of positive factors and Section 24
has a list of negatives, vis-a-vis the land under acquisition, to
be taken into consideration while determining the amount of
compensation, the first step being the determination of the
market value of the land on the date of publication of
Notification under sub-Section (1) of Section 4 of the Act. One
of the principles for determination of the market value of the
acquired land would be the price an interested buyer would be
willing to pay if it is sold in the open market at the time of issue
of Notification under Section 4 of the Act. But finding a direct
evidence in this behalf is not an easy exercise and, therefore,
the Court has to take recourse to other known methods for
arriving at the market value of the land acquired. One of the
preferred and well accepted methods adopted for working out
the market value of the land in acquisition cases is the
comparable sales method. The comparable sales i.e. the
lands sought to be compared must be similar in nature and
potentiality. Again, in the absence of sale deeds, the
judgments and awards passed in respect of acquisition of
lands, made in the same village and/or neighbouring villages
can be accepted as valid piece of evidence and provide a
sound basis to determine the market value of the land after
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suitable adjustments with regard to positive and negative
factors enumerated in Sections 23 and 24 of the Act.
Undoubtedly, an element of some guess work is involved in
the entire exercise.
10. In Shaji Kuriakose & Anr. Vs. Indian Oil Corpn. Ltd. & Ors.2
this Court had observed as under:
“While fixing the market value of the acquired land,
Comparable Sales Method of valuation is preferred than
other methods of valuation of land such as Capitalisation
of Net Income Method or Expert Opinion Method.
Comparable Sales Method of valuation is preferred
because it furnishes the evidence for determination of the
market value of the acquired land, (sic) which a willing
purchaser would pay for the acquired land if it has been
sold in open market at the time of issue of Notification
under Section 5 of the Act. However, Comparable Sales
Method of valuation of land for fixing the market value of
the acquired land is not always conclusive. There are
certain factors which are required to be fulfilled and on
fulfillment of those factors the compensation can be
awarded, according to the value of the land reflected in
the sales. The factors laid down inter alia are: (1) the sale
must be a genuine transaction, that (2) the sale deed must
have been executed at the time proximate of the date of
issue of Notification under Section 4 of the Act, that (3) the
land covered by the sale must be in the vicinity of the
acquired land, that (4) the land covered by the sales must
be similar to the acquired land and that (5) the size of plot
of the land covered by the sales be comparable to the land
acquired. If all these factors are satisfied, then there is no
reason why the sale value of the land covered by the sales
be not given for the acquired land. However, if there is
dissimilarity in regard to locality, shape, site or nature of
land between land covered by sales and land acquired, it
is open to Court to proportionately reduce the
2
(2001) 7 SCC 650
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compensation for acquired land than what is reflected in
the sales depending upon the disadvantages attached
with the acquired land”.
11. Yet again in Viluben Jhalejar Contractor (D) by LRs. Vs.
State of Gujarat3, making reference to a number of cases on
the point, it was observed as follows:
“18. One of the principles for determination of the amount
of compensation for acquisition of land would be the
willingness of an informed buyer to offer the price therefor.
It is beyond any cavil that the price of the land which a
willing and informed buyer would offer would be different
in the cases where the owner is in possession and
enjoyment of the property and in the cases where he is
not.
19. Market value is ordinarily the price the property may
fetch in the open market if sold by a willing seller
unaffected by the special needs of a particular purchase.
Where definite material is not forthcoming either in the
shape of sales of similar lands in the neighbourhood at or
about the date of Notification under Section 4(1) or
otherwise, other sale instances as well as other evidences
have to be considered.
20. The amount of compensation cannot be ascertained
with mathematical accuracy. A comparable instance has
to be identified having regard to the proximity from time
angle as well as proximity from situation angle. For
determining the market value of the land under acquisition,
suitable adjustment has to be made having regard to
various positive and negative factors vis-`-vis the land
under acquisition by placing the two in juxtaposition. The
positive and negative factors are as under:
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(2005) 4 SCC 789
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0
—————————————————————————-
–
Positive factors Negative Factors
—————————————————————————-
–
(i) smallness of size (i) largeness of area
(ii) proximity to a road (ii) situation in the interior
at a distance from the
road
(iii) frontage on a road (iii) narrow strip of land
with very small
frontage compared to
depth
(iv) nearness to developed (v) lower level requiring
area the depressed
portion
to be filled up
(v) regular shape (v) remoteness from
developed locality
(vi) level vis-a-vis land under (vi) some special
acquisition disadvantageous
factors which would
deter a purchaser
(vii) special value for an owner
of an adjoining property to
whom it may have some
very special advantage”.
12. Thus, comparable sale instances of similar lands in the
neighbourhood at or about the date of Notification under
Section 4(1) of the Act are the best guide for determination of
the market value of the land to arrive at a fair estimate of the
amount of compensation payable to a land owner.
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Nevertheless, while ascertaining compensation, it is the duty
of the Court to see that the compensation so determined is
just and fair not merely to the individual whose property has
been acquired but also to the public which is to pay for it.
13. The next question is as to the scope of interference by this
Court in an award granting compensation. The scope of
interference by this Court was delineated by the decision in
Kamta Prasad Singh Vs. State of Bihar4 wherein this Court
held that there was an element of guesswork inherent in most
cases involving determination of the market value of the
acquired land. If the judgment of the High Court revealed that
it had taken into consideration the relevant factors prescribed
by the Act, in appeal under Article 133 of the Constitution of
India, assessment of market value thus made should not be
disturbed by this Court.
14. The following observations of this Court in Food Corporation
of India through its District Manager, Faridkot, Punjab &
Ors. Vs. Makhan Singh and Anr.5 are quite apposite:
“This Court as the last Court of appeal, will ordinarily not
interfere in an award granting compensation unless there
is something to show not merely that on the balance of
4
(1976) 3 SCC 772
5
(1992) 3 SCC 67
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evidence it is possible to reach a different conclusion, but
that the judgment cannot be supported by reason of a
wrong application of principle or because some important
point affecting valuation has been overlooked or
misapplied. Besides, generally speaking, the appellate
court interferes not when the judgment under appeal is
not right but only when it is shown to be wrong. See in
this connection, The Dollar Company, Madras v.
Collector of Madras, (1975) 2 SCC 730. Added thereto
are other rules of prudence that the courts do not treat at
par land situated on the frontage having special
advantage and the land situated in the interior
undeveloped area, or to compare smaller plots fetching
better price with large tracts of land. See in this
connection Periyar and Pareekanni Rubbers Ltd. v. State
of Kerala, (1991) 4 SCC 195 : AIR 1990 SC 2192.”
15. Therefore, the scope of interference in such matters is very
limited and it is only in cases where it is found that the
authorities below have either applied wrong principles or have
omitted to take into consideration some important point
affecting valuation, that this Court can interfere.
16. Bearing these principles in mind, we may now advert to the
facts of the present case.
17. In the instant case before the Reference Court, the appellant
had examined 4 witnesses including himself as PW-1. In
support of his claim, he brought on record Ex. A.1 to A.8.
However, presently we are required to consider Ex. A.6, the
judgment of Subordinate Judge, Medak in O.P. No.112 of
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1987 dated 25th April, 1991, fixing the rate of compensation for
the land, stated to be contiguous to the land of the appellant,
at Rs.18/- per square yard. Ex. A.7 is the certified copy of the
decree in the said original petition. As is clear from its afore-
extracted order, the High Court relied on its decision in A.S.
No.2336 of 1998 on the ground that the land in question in the
said suit was acquired vide Notification under Section 4 of the
Act dated 4th January, 1987; the area of the land was 3 acres
9 guntas; the land was situated in the same village and was
acquired for the same very public purpose of construction of
Singnoor project as in the present case. The High Court
noted that the Notification under Section 4 of the Act in the
case of the appellant having been published within 6 months
of the date of Notification in the afore-mentioned suit i.e. 15th
July, 1987, it was not possible and permissible to take a
different view other than the one taken in the said suit. While
discarding Exs. A.6 and A.7, the Court has noted that the
lands, subject matter of that acquisition, were not situated in
the same village.
18. Therefore, the question for consideration is whether in the
light of the said finding of the High Court, it could be said that
the High Court has applied a wrong principle of law or has
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taken into consideration irrelevant material, warranting
interference by this Court. Having gone through the evidence
on record, we find it difficult to accept the stand of the
appellant that the High Court should have relied on Ex. A.6
instead of its earlier decision in A.S. No.2336 of 1998. It may
be true that in the absence of the instance relied upon by the
High Court, Ex. A.6 could be taken into consideration as one
of the comparable sale instances but at the same time
reliance on its earlier judgment in respect of a land situated in
the same village, acquired only six months ago, could not be
said to be an irrelevant factor affecting the determination of
market value/compensation in respect of the land of the
appellant. As observed in Pal Singh’s case (supra), said
judgment is a valid instance from which the market value of
the subject land could be deduced. Merely because a different
conclusion could be possible on two sets of sale/acquisition
instances, in our judgment, is no ground to interfere with the
award of the High Court when it has taken into consideration
an instance which is more closer to appellant’s land in respect
of the date of acquisition; happened to be in the same village
and acquired for the same purpose.
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19. In the light of above discussion, we do not find any ground to
interfere with the decision of the High Court. There is no merit
in the appeal, which is dismissed accordingly. We make no
order as to costs.
…………………………………….J.
( D.K. JAIN )
…………………………………….J.
( R.M. LODHA )
NEW DELHI,
APRIL 13, 2009.