{"id":161438,"date":"1996-12-13T00:00:00","date_gmt":"1996-12-12T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/the-manipur-tea-co-pvt-ltd-vs-the-collector-of-hailakandi-on-13-december-1996"},"modified":"2018-10-29T17:44:42","modified_gmt":"2018-10-29T12:14:42","slug":"the-manipur-tea-co-pvt-ltd-vs-the-collector-of-hailakandi-on-13-december-1996","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/the-manipur-tea-co-pvt-ltd-vs-the-collector-of-hailakandi-on-13-december-1996","title":{"rendered":"The Manipur Tea Co. Pvt. Ltd vs The Collector Of Hailakandi on 13 December, 1996"},"content":{"rendered":"
Supreme Court of India<\/div>\n
The Manipur Tea Co. Pvt. Ltd vs The Collector Of Hailakandi on 13 December, 1996<\/div>\n
Bench: K. Ramaswamy, G.T. Nanavati<\/div>\n
           PETITIONER:\nTHE MANIPUR TEA CO. PVT. LTD.\n\n\tVs.\n\nRESPONDENT:\nTHE COLLECTOR OF HAILAKANDI\n\nDATE OF JUDGMENT:\t13\/12\/1996\n\nBENCH:\nK. RAMASWAMY, G.T. NANAVATI\n\n\n\n\nACT:\n\n\n\nHEADNOTE:\n\n\n\nJUDGMENT:\n<\/pre>\n
\t       THE 13TH DAY OF DECEMBER 1996
\npresent:\n<\/p>\n
\t       Hon’ble Mr.Justice K. Ramaswamy
\n\t       Hon’ble Mr.Justic G.T.Nanavati
\n     Dr.A.M.Shighvi, Sr.Adv.,\tManoj  Arora, Ms.S.Hazarika,
\nMs.H.Wahi, Advs. With him for the appellant
\n     S.N.Chaudhary, Sr.Adv.  and S.A.Syed, Adv. with him for
\nthe Respondent
\n\t\t\t O R D E R
\n     The following Order of the Court was delivered:
\n     Leave granted.\n<\/p><\/blockquote>\n
     We have heard learned  counsel on both sides.<\/p><\/blockquote>\n
     These appeals  by special leave arise from the judgment
\nof Division  Bench of  Assam High  Court, made on August 17,
\n1992 in\t First Appeal  Nos.67\/87 and  11-14\/88. Notification
\nunder Section  4(1) of\tthe Land  Acquisition Act, 1894 (for
\nshort, the  “Act”) were\t published on  5.9.1981,  21.9.1982,
\n23.9.1982 and  24.9.1982 acquiring 123 Bighas 11 Cottahs and
\n13 Chitaks  of the appellants’ tea Estate for laying Railway
\ntracks. The  Collector by his award dated March 19, 1985 and
\nalso by\t another award\tdated  March  25,  1985\t awarded  in
\nrespect of  the\t lands\tacquired  a  sum  of  Rs.17,59,975\/-
\nagainst\t the   total  claim   of  Rs.1,77,92,238\/-   on\t the
\ncomputation made  in that Court enhanced the compensation to
\nRs.43,89,038\/- with  solatium, and  interest thereon  in the
\nsum  of\t  Rs.67,60,730\/-  has  been  awarded  as  additional
\ncompensation.  On   appeal,  the   High\t Court\treduced\t the
\ncompensation from  Rs.43,89,038 to  Rs.40,89,038\/-.  feeling
\naggrieved by  the impugned judgment, these appeals have been
\nfiled by the appellant.\n<\/p>\n
     Dr. A.m.  Singhvi, learned senior counsel appearing for
\nthe  appellant,\t  contents  that  the  High  Court  and\t the
\nreference Court\t committed a  grievous error in relying upon
\nthe sale  statistics earlierelied on by the Land Acquisition
\nOfficer without examining any witness which formed basis for
\nhis award.  The Courts\talso had wrongly rejected three sale
\ndeeds Exs.17(1)\t to 17(3)  proved on behalf of the appellant
\nand, therefore\tis clear  error\t of  law  in  reaching\tthat
\nconclusion. On\tthe  face  of  it,  we\tfind  force  in\t the
\ncontention. The\t sale  statistics  relied  on  by  the\tLand
\nAcquisition Officer  are not  unless persons  connected with
\nthe sale  deeds and  the documents,  also made\tpart of\t the
\nrecord, are  examined. Therefore, the sale statistics cannot
\nipso facto  form a  basis to  determine the compensation. As
\nregards the  three sale\t deeds relied  on by  the appellant,
\nboth the  High Court  as well as the reference Court came to
\nthe conclusion\tthat they  relate to  the agricultural\tland
\nwhile  the   acquisition  is   in  respect  of\ttea  garden.
\nTherefore, they\t could\tnot  form  the\tbasis  to  determine
\ncompensation. Moreover,\t it was\t also found that they relate
\nto sale\t transactions which  took place 5 years prior to the
\ndate of\t the   notification published  under  section  4(1).
\nNeither the  vendees were  examined as witnesses. Therefore,
\nthe rejection of those sale deeds is perfectly in accordance
\nwith law. They do not form any base for determination of the
\ncompensation. It  is settled  law that\tthe burden is on the
\nclaimants  to\tprove  by   adducing  cogent,  reliable\t and
\nacceptable evidence  the market value under Section 23(1) of
\nthe   Act. The\tburden does not shift over to the Government
\nbut it\tis the\tduty of\t the duty of the Court to assess the
\nevidence  adduced   by\tthe   claimants\t and  determine\t the
\ncompensation on\t the touchstone\t of prudent purchaser in the
\nopen market,  i.e., whether  he would  offer market value at
\nthe rates  proposed by the Court. The evidence has to be put
\nto the\ttest whether  the sale\tdeed or the evidence adduced
\nwould offer  the market\t value higher  than  that  has\tbeen
\ndetermined by the Land Acquisition Officer. The compensation
\nawarded by  the Land  Acquisition Officer  is an  offer that
\nblinds the  Government but  it is  not conclusive. It is for
\nthe claimants  to prove\t as to\twhat would be the reasonable
\ncompensation which  the land  is capable  of fetching in the
\nopen  market.  The  question  is:  whether  the\t Land  under
\nacquisition, if\t put to\t the private sale in an open market,
\nwould be  capable to secure the same price as offered by way
\nof  determination   of\tthe  compensation  after  compulsory
\nacquisition. Considered\t from this  perspective,  the  Court
\nconsidered  the\t  evidence  adduced   and   determined\t the
\ncompensation.  The  High  Court\t and  the  reference  Court,
\ntherefore, correctly  applied the  test and  did not  accept
\nthree sale  deeds produced  by the  appellant in determining
\nthe compensation  which relate to the agricultural land; not
\nthe tea\t garden or  estate. Having  rejected the  sale deeds
\nrelied on  by the appellant to do justice to the respondent,
\nthey  relied   on  sale\t  statistics  relied   by  the\tLand
\nAcquisition Officer.  Under these  circumstances, we  do not
\nfind any ground in the approach adopted by the Courts below.\n<\/p>\n
     It is  then contended  that tea  garden always  secured
\nhigher market  value than  the paddy fields. In that behalf,
\nreliance was  placed upon  Section 42  of  the\tWest  Bengal
\nEstate Acquisition  Act, 1953 and similar provision in Assam
\nLand Acquisition  Act and  Assessment  Ordinance,  1989,  as
\napplicable, to\tshow that  the market value of tea garden is
\nrequired to  be determined  at the  rate twice\tthe value of
\npaddy. A  distinction has  been\t made  between\tthe  two  in
\ndetermination of compensation, by the statute as tea gardens
\nare required  to be  assessed at the rate 2-1\/2 times higher
\nthan the  paddy fields.\t Therefore, the\t said  yardstick  is
\nrequired to  be adopted\t in determining the compensation. We
\ndo not agree with the contention.\n<\/p>\n
     The principle  of\tdetermination  of  the\tcompensation
\nunder Section  23(1) of\t the Act  is entirely  different and
\ndistinct from  the principles  applicable in determining the
\ncompensation under  Land Reforms Act. What is required to be
\ndetermined is  the prevailing market value of the Land as on
\nthe date of the notification published under Section 4(1) of
\nthe Act\t and, therefore,  the principle for determination of
\nthe  compensation   under  the\t Land  Reforms\tAct  or\t the
\nAcquisition Act has no relevance or bearing.\n<\/p>\n
     It\t is  then  contended  that  the\t courts\t below\thave
\ncommitted error\t in not\t granting escalation charges for the
\ndetermination of the compensation to the tea garden. In that
\nbehalf, it  is contended  that the reference Court proceeded
\nin paragraph 30 on the be sis that the age of the tea bushes
\nwould  be  35  to  40  years.  The  report  of\tthe  Tocklai
\nExperimental Station of Tea Research would indicate that the
\nlife of\t the trees  would be  more than\t 25 to 30 years. The
\nyield would  be more  than 25  to 30  years  and  thereafter
\ngradually decrease.  The  Court\t below\twere  not  right  in
\ndetermining 20\tyears as  the age  of the bushes and on that
\nbasis fix  the yield  per month at Rs.270\/-. In fact even on
\nthe basis  of those calculations, the claimants are entitled
\nto more\t that Rs.367\/-\tper month.  It is  now\tan  admitted
\nposition that  except one witness, Bharthakur who has stated
\nabout the age of the trees, there is no evidence in proof of
\nthe  above   statistics\t given\t by  the  Research  Station.
\nTherefore, though  the Land  Acquisition Officer  had relied
\nupon that  statement in\t determining  the  compensation,  in
\ntrial, before the Court that did not ipso facto form part of
\nthe record  unless the\tperson connected  with the  Research
\nStation was  examined as witness in that behalf. Admittedly,
\nno witness has been examined. In fact, if State had filed an
\nappeal perhaps\tthe things  would have\tbeen different.\t The
\nHigh  Court  and  the  reference  Court\t had  adopted  wrong
\nprinciple of  law with\ta view\tto give\t the benefit  to the
\nappellant  rather   than  dismissing   its  application\t for
\nenhancement of\tthe compensation. The District Judge as well
\nas the\tHigh Court  preceded on the basis of the said report
\nand fixed  the age  of the  bush at 20 years for the maximum
\nyield. Therefore, we do not find any legal base to interfere
\nwith that.\n<\/p>\n
     Further, Dr. Singhvi says that it being an arithmetical
\nmistake, liberty  may be  given to the claimants to approach
\nthe reference  Court for  amendment of the decree. It may do
\nso, if\tit is  open to it. The District Judge as well as the
\nHigh Court have held that for the remaining 15 years the tea
\nbushes would  give their  yield though\tevery year, it would
\ngradually decrease. They have taken 200 gms. per bush as the
\naverage yield  as stated  in paragraph 30 of the award which
\nreads as under:\n<\/p>\n
     “In other words, the tea bushes are
\n     not likely\t to produce  400 gms. of
\n     made  tea\t for  the  remaining  15
\n     years. The\t production will go down
\n     gradually\t till\t the\teconomic
\n     viability will  become zero  at the
\n     end of 15 years. In order to assess
\n     the quantum of viability, we are to
\n     take the  mean of 200 gms. per year
\n     in average\t per  bush  for\t the  15
\n     years. The\t yield per  bush  as  on
\n     today  cannot  be\texpected  during
\n     next  15\tyears.\t In   spite   of
\n     increasing variable  costs such  as
\n     costs of  manure  etc.  the  return
\n     will gradually  go\t down  till  its
\n     economical viability  becomes  zero
\n     after 15 years.”<\/p><\/blockquote>\n
     The finding  thus recorded\t is a  pure question of fact
\nconsidering the\t economic viability, the nature of the yield
\nand the\t longevity of  the trees.  Therefore, the  reference
\nCourt rightly  had put\tit as  200 gms. per year for average
\nbush for 15 years and this calculation was made in paragraph
\n81 and the actual amount receivable, namely, (15 years X 200
\ngms.) (21.81 – 14.00) – 3 X 7.81 per bush – and Rs.23.43 per
\nbush was  fixed. Under these circumstances, it was held that
\nthey are  entitled to compensation at that rate per bush and
\nthe Collector,\tafter deducting\t the amount already paid was
\ndirected to  make the  balance payment. It being an arena of
\nappreciation of\t evidence on  the factual matrix, we are not
\ninclined to interfere with that finding.\n<\/p>\n
     It is  next contended  that the  reference Court having
\nnoticed that  in three\tmonths\tan  area  of  90  Cottas  11
\nChittaks was  sold on  May 21,\t1979 @ Rs.2,539,68 per bigha
\nand 18\tCottas 13 Chittaks of land was sold on March 7, 1980
\n@ Rs.1,268,83  per bigha  and a\t further area  of 1  bigha 4
\nCottas and  4 chittaks\twas sold @ Rs. 4,948.45 per bigha on
\nJanuary 3,  1981, which\t would show that there was a gradual
\nrise  in  the  prices,\tfixing\tthe  escalation\t charges  at
\nRs.270\/- per months was wrong; instead, escalation must be @
\nRs.367\/-. Thus\tthe principle  adopted by  the Court  is not
\ncorrect in  law. In  fact, the above finding is incorrect in
\nlaw for\t the reason  that the  persons connected  with those
\nsale deeds  were not examined to show the nature of the land
\nunder acquisition and of the lands under the sale deeds. The
\ncircumstances under  which the purchase came to be made, the
\nrelative distance  of the land and the respective prevailing
\nprices in respect of those areas are the factors to be taken
\ninto account. In this case, such an attempt was not made. It
\nwas required  to be proved that there was really an increase
\nin the\tvalue of the land. As a matter of fact, it has to be
\nestablished that  there is gradual increase, every month, in
\nthe value  of the land of that area and, therefore, when the
\ncompulsory acquisition\twas made, the appellant was entitled
\nto higher  compensation. Though the State has not approached
\nthis  Court,  we  can  hold  that  there  is  no  illegality
\ncommitted by  the Courts below in granting the escalation at
\nRs.270\/- per bush.\n<\/p>\n
     It is then contended that the reference Court awarded a
\nsum of\tRs.4,71,312\/- as  severance charges.  The High Court
\nhas found  that due  to the  severance, the appellant had to
\nput not\t only the  fencing but\talso the drainage to protect
\nthe tea\t garden and  the expenses  incurred therefor came to
\nthe tune  to  Rs.2,36,010\/-.  Instead  of  adding  severance
\ncharges awarded\t by the\t reference Court, the High Court has
\nreduced the  compensation. Therefore,  it committed an error
\nof law. We find no force in the contention.\n<\/p>\n
     Clause thirdly,  of Section  23(1) envisages  that\t the
\ndamage (if  any) sustained  by the person interested, at the
\ntime of\t the Collector’s  taking possession  of the land, by
\nreason of severing such land from his other land is required
\nto determined  as  compensation\t under\tsub-section  (1)  of
\nSection 23.  It is seen that by reason of the acquisition of
\nthe land  of the  appellant to\tlay of\tRailway tracks,\t the
\ncontiguity of  the tea\testate was  severed and 2\/3rd of the
\nestate had  remained on\t one side  and 1\/3 on the other. The
\nquestion  is:  what  would  be\tthe  compensation  for\tthat
\nseverance?  The\t question  is  confined\t to  the  extent  of
\nexpenditure. The  compensation has  to be  awarded for\tsuch
\nseverance. It  is stated  by the  claimants that  they\twere
\nrequired to put up fencing for protecting the tea estate and
\nalso the drainage channel. It is sen that the High Court has
\nproceeded on  that premise  and it  is not  a  case  of\t the
\nparties that  on account of the acquisition of the land, the
\ntea estate  is exposed\tto the\tpublic and  the public\thave
\naccess into  the tea  estate only  the railway\ttracks would
\npass through  the estate  and, therefore,  setting up of the
\nfencing or of the drainage to protect the tea estate may not
\nbe necessary.  We need\tnot go\tinto that question since the
\nState has  not come  in appeal. Suffice it to state that the
\nHigh Court  having found  that the appellant was required to
\nset up\ta fencing  and the  drainage channel,  and amount of
\nRs.2,36,000\/- as  estimated, would be sufficient to meet the
\nexpenditure. It\t being an estimate made by the appellant, we
\ndo not find any error of law warranting interference.\n<\/p>\n
     It is  then contended  that by operation of the proviso
\nto section 28 of the Act, the claimants would be entitled to
\ninterest for  one year\tfrom the date of taking possession @
\n9% per\tannum and  for the balance period @ 15% per annum on
\nthe enhanced compensation. We find force in the contention.\n<\/p>\n
     It is  sought to  be contended for respondents that the
\nreference Court\t and the  High Court  have proceeded  on the
\nprinciple that\tthe Court has discretion to award interest @
\n15% or\tless and  on facts, the Court found that 9% would be
\nreasonable rate\t of interest.  We  find\t that  the  approach
\nadopted by the reference Court and High Court is not correct
\nsince the statute has given measure of amassment of interest
\nfor the\t first year  @ 9% from the date of taking possession
\nand on\texpiry thereof @ 15% till date of deposit into Court
\non the\tenhanced compensation. It is a legislative principle
\nthat the  claimant would be entitled to the rate of interest
\nfor the said period.\n<\/p>\n
     Under these  circumstances, though\t the word  ‘may’ has
\nbeen used  in proviso  to Section  28 of  the Act, it has to
\nconstrued as  ‘shall’ and, therefore, the claimants would be
\nentitled  to   interest\t at  the  rate\tof  9%\ton  enhanced
\ncompensation for  one year and thereafter @ 15% till date of
\ndeposit in the Court.\n<\/p>\n
     The  appeals  are\taccordingly  allowed  only  to\tthis
\nextent. But, in the circumstances, without costs.<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India The Manipur Tea Co. Pvt. Ltd vs The Collector Of Hailakandi on 13 December, 1996 Bench: K. Ramaswamy, G.T. Nanavati PETITIONER: THE MANIPUR TEA CO. PVT. LTD. Vs. RESPONDENT: THE COLLECTOR OF HAILAKANDI DATE OF JUDGMENT: 13\/12\/1996 BENCH: K. RAMASWAMY, G.T. NANAVATI ACT: HEADNOTE: JUDGMENT: THE 13TH DAY OF DECEMBER 1996 […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-161438","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nThe Manipur Tea Co. Pvt. 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