Madras High Court
The Special Tahsildar (Lao), Land ... vs T.L. Radhakrishnan on 23 February, 2001
Equivalent citations: (2001)1MLJ657
Author: P. Sathasivam
Bench: P. Sathasivam
ORDER P. Sathasivam, J.
1. Special Tahsildar (LAO) Land Acquisition-II, Tamil Nadu Housing Board, Madras-35 is the appellant in the above appeal. Aggrieved by the order of the learned Subordinate Judge in L.A.O.P.No. 13 of 1993 dated, the Special Tahsildar has filed the above appeal and the claimant has also filed Cross Objection No.97 of 1997 regarding disallowed claim by the learned Subordinate Judge. Since both the appeal and cross objection arise against the same order passed by the learned Subordinate Judge, they are being disposed of by the following common order.
2. An extent of 2.12 acres in S.No.767A1A. Paranur Village, Chengalpatlu District were acquired by the Government for implementation of Tamil Nadu Housing Scheme. Notification under Section 4(1) of the Land Acquisition Act, 1894 (Central Act I of 1894) (hereinafter referred to as "the Act") has been published in the Gazette dated 16.8.89. After complying with the other provisions, the Land Acquisition Officer has passed an award No. 1 of 1992 dated 30.7.92 fixing the value of the land at Rs.400 per cent. At the instance of the land owner, the matter has been referred to the Additional Sub Court, Chengalpattu under Section 18 of the Land Acquisition Act for adjudication which resulted in L.A.O.P.No.13 of 93. Before the learned Subordinate Judge, the claimant has prayed for compensation at the rate of Rs.4,500 per cent. One T.R. Chandramozheeswaran, son of the claimant, has been examined as P.W.1 and Exs. P-1 to P-21 marked in support of his claim. On the side of the referring Officer, one L. Natarajan has been examined as R.W.1 and Exs. R-1 to R-3 marked in support of their stand. The learned Subordinate Judge, after considering the award of the Land Acquisition Officer, the oral and documentary evidence let in by both sides. Sale-deed Ex.P-13 dated 14.6.88, fixed compensation at the rate of Rs.3,265 per cent and also granted other statutory amounts payable to the claimant. As stated above, aggrieved by the said order, both the Special Tahsildar, Land Acquisition and the claimant have preferred the appeal and cross objection.
3. We have heard the learned Additional Government Pleader for the appellant as well as Mr. R. Gandhi, learned Senior Counsel for the claimant.
4. Learned Additional Government Pleader after taking us through the order of the learned Subordinate Judge as well as the documents produced before him, would contend that the learned Subordinate Judge committed an error in relying on Sale-deeds Exs. P-13 and P-16 to P-19 for fixing the value of the acquired land. According to him, none of the parties to the documents has been examined to prove the contents of the same and, in any event, the sale transactions referred to in Exs. A-16 to A-19 are after the date of 4(1) Notification and only a small extent of land had been sold. On the other hand, Mr. R. Gandhi, learned senior counsel for the respondent/claimant, would contend that in the light of the fact that the acquired land is just abutting on the G.S.T. Road and it has more potential value since the same is being used for house sites and in the light of the oral evidence of P.W. 1, son of the claimant and documentary evidence, particularly in Exs. P-13, P-16 and P-17, the claimant is entiiled to compensation at the rate of Rs.4,500 per cent. He also contended that post notification sales as well as value prevailing in the neighbouring village can also be considered while determining the compensation for the acquired lands.
5. We have carefully considered the rival submissions.
6. There is no dispute that out of the total acquired lands of 2.34 acres in S.No. 76/A1A, an extent of 2.12 acres belonged to the claimant. Initially the lands were purchased by the mother of the claimant from various persons under Exs. P-1 to P10 Sale-deeds. It is also not disputed that after the death of his mother Karunambal Ammal, the claimant became the owner of the said lands. It lies near the G.S.T. Road and the same was acquired for construction of houses by the Tamil Nadu Housing Board. 4(1) Notification has been published in the Gazette dated 16.8.89. The Land Acquisition Officer has considered 24 sales statistics ranging from 1986 to 1988 that is 3 years prior to the date of 4(1) Notification. Among other sale items, he considered sale item 8 dated 18.1.88 which pertains to S.No-79/A1 and the same was sold at the rate of Rs.400 per cent. Since the said land forms part of the acquired land, the same has been treated as data land and fixed compensation at the rate of Rs.400 per cent. Though R.W.1 has also admitted that the acquired land in S.No.76/AlA lies near the G.S.T. Road and P.W.1 very much pressed into service various transactions namely Exs. P-12, P-13, P-16 and P-17, admittedly none of the parties to those documents was examined to prove the contents of the same before the Court below. Though the son of the claimant has been examined as P.W.1, admittedly, he is nothing to do with any of those documents. In a catena of decisions the Supreme Court has taken a view that in the absence of examination of either the vendor, or the vendee or one of the attestors or the scribe of the document, the same is inadmissible in evidence and it cannot be relied on for the purpose of determining the compensation for the acquired lands. This view has been reiterated by the Supreme Court in the following decisions:-
(1) Kummari Veeraiah v. State of A.P. (2) G. Narayan Rao v. Land Acquisition Officer, (3) UP SRTC Atigarh v. State of V.P., ( 4) AP State Road Transport Corporation, Hyderabad v. P. Venkaiah, (5) Special Dy. Collector v. Kurra Sambasiva Rao, . (6) Mcharban v. State of U.P. .
In our case, the learned Subordinate Judge very much relied on Sale-deeds Ex. P-12 dated 3.12.87 and P-13 dated 14.6.88. Under P-12 one cent of land has been sold for Rs.2250. Likewise, under Ex.P-13 one cent of land has been sold for Rs.2180. As a matter of fact, both these documents were considered by the Land Acquisition Officer and since Ex.P-12 includes not only the land but also the building therein, accordingly rejected Ex.P-12. The learned Subordinate Judge after finding that the land covered under Ex.P13 is nearer to the acquired lands and Similar in all aspects accepted the same for the purpose of fixation of compensation for, the acquired lands. Since Ex.P13 is dated 14.6.88 that is prior to the 4(1) Notification, after referring the other sale transactions under Exs.P-16 to P-19 which are all well after the 4(1) Notification, considering the steady rise in prices of the land, after adding Rs.1085 to the value under Ex.P-13, fixed Rs.3,265 per cent as value for the acquired land. It is clear that the land acquisition officer not only considered Ex.P-13, but also relied on Exs. P-16 and P-17. We have already referred to the fact that except P.W.1, son of the claimant, no one relating to Exs. P-13 or P-16 and P-17 were examined to prove those documents. In such a circumstance, by applying the principles laid down by the Supreme Court, the said documents are inadmissible in evidence and the same cannot be relied on to determine the value of the acquired lands. On this ground, the amount arrived by the learned Subordinate Judge is liable to be set aside. No doubt, Mr. R. Gandhi, learned senior counsel for the respondent, by taking us through the evidence of P.W.1, vehemently contended that in view of the potential value and the land being used for construction of houses, the claimant is entitled just and reasonable compensation of Rs.4000 per cent. We are not under-estimating the value of the acquired lands because of its proximity to other important places. However, in view of the fact that the documents-Exs.P-13, P-16 and P-17, relied on by the learned Subordinate Judge, were not proved in the manner known to law, as observed by the Supreme Court, hence those documents are not helpful to the claimant's case. It would not be possible to fix just and reasonable. Compensation merely on the basis of oral evidence of P.W.1 and R.W.1.
7. Mr. R. Gandhi, learned senior counsel for the claimant by relying on a decision of the Supreme Court in the case of Administrator General of West Bengal v. Collector, Varanasi, , would contend that sale transaction subsequent to the preliminary notification in respect of land acquired can be relied upon for determining market value of land under acquisition. We have already mentioned that 4{1) Notification is dated 16.8.89, Ex.P-16 is dated 6.6.90 and Ex.P-17 is dated 18.7.90. Though in the said decision, the Supreme Court has held that sale transaction subsequent to the preliminary notification under Section 4(1) can be relied upon for determining the market value, there must be an evidence to show that the market value was stable and there was no fluctuation in the prices between the date of preliminary notification and the dale of subsequent transaction. In other words, it is clear from the said decision, the said principle can be appealed to only where there is evidence to the effect that there was no upward surge in the prices in the interregnum and the burden of establishing this would be squarely on the party relying on such subsequent transaction. In our case, under Ex.P-13, which is prior to the 4(1) Notification, one cent of land has been sold at Rs.2180. On the other hand, under Ex.P-16 dated 6.6.90, one cent has been sold at the rate of Rs.3755 and under Ex.P-17 dated 18.7.90, one cent has been sold at Rs.4315. It is clear that after the preliminary notification under section 4(1) dated 16.8.89, within a period of one year, there is a steep increase in the value of the land. In such a circumstance, in the absence of any evidence that the market was stable and there was no fluctuation in the prices between the date of the preliminary notification and the date of subsequent transaction and on the other hand, there is evidence to the effect that there was steep increase in prices in the interregnum, we are of the view that both the said transactions under Exs.P-16 and P-17 cannot be relied upon. The said decision relied on by the learned Senior counsel is not helpful to the claimant's case. The other decision cited by the learned senior counsel for the respondent is in the case of Chimanlal v. Special Land Acquisition officer. Poona, . After referring Section 23 of the Land Acquisition officer, the Supreme Court has held as follows:- (para 4) "4. The following factors must be etched on the mental screen:
(1) A reference under Section 18 of the Land Acquisition Act is not an appeal against the award and the Court cannot take into account the material relied upon by the Land Acquisition Officer in his Award unless the same material is produced and proved before the Court.
(2) So also the Award of the Land Acquisition Officer is not to be treated as a judgment of the trial Court open or exposed to challenge before the court hearing the Reference. It is merely an offer made by the Land Acquisition Officer and the material utilised by him for making his valuation cannot be utilised by the Court unless produced and proved before it. It is not the function of the Court to sit in appeal against the Award, approve or disapprove its reasoning, or correct its error or affirm, modify or reverse the conclusion reached by the Land Acquisition Officer, as if it were an appellate Court.
(3) The Court has to treat the reference, as an original proceeding before it and determine the market value afresh on the basis of the material produced before it.
(4) The claimant is in the position of a plaintiff who has to show that the price offered for his land in the award is inadequate on the basis of the materials produced in the Court. Of course the materials placed and proved by the other side can also be taken into account for this purpose.
(5) The market value of land under acquisition has to be determined as on the crucial date of publication of the notification under Sec. 4 of the Land Acquisition Act (dates of Notifications under Sections 6 and 9 are irrelevant) (6) The determination has to be made standing on the date line of valuation (date of publication of notification under Sec. 4 as if the valuer is a hypothetical purchaser willing to purchase land from the open market and is prepared to pay a reasonable price as on that day. It has to be assumed that the vendor is willing to sell the iand at a reasonable price.
(7) In doing so by the instances method, the Court has to correlate the market value reflected in the most comparable instance which provides the index of market value.
(8) Only genuine instances have to be taken into account. (Sometimes instances are rigged up in anticipation of Acquisition of land).
(9) Even post-notification instances can be taken into account (1) if they are very proximate, (2) genuine and (3) the acquisition itself has not motivated the purchaser to pay a higher price on account of the resultant improvement in development prospects.
(10) The most comparable instances out of the genuine instances have to be identified on the following considerations:
(i) proximity from time angle (ii) proximity from situation angle.
(11) Having identified the instances which provide the index of market value the price reflected therein may be taken as the norm and the market value of the land under acquisition may be deduced by making suitable adjustments for the plus and minus factors vis-a-vis land under acquisition by placing the two in juxtaposition.
(12) A balance-sheet of plus and minus factors may be drawn for this purpose and the relevant factors may be evaluated in terms of price variation as a prudent purchaser would do.
(13) The market value of the land under acquisition has thereafter to be deducted by loading the price reflected in the instance taken as norm for plus factors and unloading it for minus factors.
Plus factors
1. Smallness of size.
2. Proximity to a road.
3. frontage on a road.
4. nearness to developed area.
5. regular shape.
6. level Vis-a-vis land under acquisition.
7. Special value for an owner of an adjoining property to whom it may have some very special advantage.
(14) The exercise indicated in clauses (11) to (13) has to be undertaken in a common sense manner as a prudent man of the world of business would do. We may ullustrate some such illustrative (not exhaustive) factors:-
Minos factors
1. largeness of area.
2. situation in the interior at a distance from the road.
3. narrow strip of land with very small frontage compared to depth.
4. lower level requiring the depressed portion to be filled up.
5. remoteness from developed locality.
6. some special disadvantageous factor which would deter a purchaser.
(15) The evaluation of these factors of course depends on the facts of each case. There cannot be any hard and fast or rigid rule. Common sense is the best and most reliable guide. For instance, take the factor regarding the size. A building plot of land say 500 to 1000 sq.yds cannot be compared with a targe tract or block of land of say 10000 sq.yds. or more. Firstly while a smaller plot is within the reach of many, a large block of land will have to be developed by preparing a lay out, carving out roads, leaving open space, plotting out smaller plots, waiting for purchasers (meanwhile the invested money will be blocked up) and the hazards of an entrepreneus. The factor can be discounted by making a deduction by way of an allowance at an appropriate rate ranging approx. between 20% to 50% to account for land required to be set apart for carving out lands and plotting out small plots. The discounting will to some extent also depend on whether it is a rural area or urban area, whether building activity is picking up, and whether waiting period during which the capital of the entrepreneur would be locked up will be longer or shorter and the attendant hazards.
(16) Every case must be dealt with on its own fact pattern bearing in mind all these factors as a prudent purchaser of land in which position the Judge must place himself.
(17) These are general guidelines to be applied with understanding informed with common sense."
In the light of the principles laid down, both the sale transactions in Exs. P-16 and P-17 cannot be considered since both are nearly one year after the 4(1) Notification. Though post-notification instances can be taken into account, we have already demonstrated that the market was not stable, and on the other hand, there is evidence to the effect that there was upward surge in the prices in the interregnum period. Further, the area sold under both these documents are less than a ground (1 ground = 2400 sq.ft). For all these reasons, we are unable to rely upon Exs. P-16 and P-17 in order to determine the value of the acquired land.
8. Learned senior counsel for the claimant by relying on a decision in Hansali Walimchand v. State of Maharashtra, , would contend that for determining market value of land, its future potential on account of its location has to be considered. Though it lies near the G.S.T. Road, we have already referred to that merely on the basis of the oral evidence of P.W. 1, the value cannot be determined, if acceptable documentary evidence is available regarding proper valuation, the locationa) advantage can also be considered. Learned senior counsel has also relied on a decision in G. Narayan Rao v. Land Acquisition Officer, and (2) a Division Bench decision of this Court in The Special Tahsildar (L.A), Neighbourhood Scheme, Erode v. Pavayammal, 2001 (1) CTC 16 : 2001 (1) M.L.J. 352 to show that poteniiality of the land and advantageous location have to be considered. There is no dispute with regard to the above contention. Undoubtedly, while determining compensation for the acquired lands under Section 23 of the Act, the potentiality of the land and the advantageous location have to be taken into consideration. We have already referred to this aspect and held that in the absence of any acceptable documentary evidence, merely on the basis of oral evidence of P.W.1, the value of the acquired land cannot be determined. To make it clear that in addition to the documentary evidence, potentiality of the land and advantageous location of the land have to be considered while determining the compensation amount for the acquired lands.
9. The burden of proof that the amount awarded by the Land Acquisition Officer is not adequate is always on the claimant. The burden is to adduce relevant and material evidence to establish that the acquired lands are capable of fetching higher market value than the amount awarded by the Land Acquisition Officer or that the Land Acquisition officer proceeded on a wrong premise or applied a wrong principle of law. The object of the enquiry in a reference under Section 18 of the Act is to bring on record the price which the land under acquisition was capable of fetching in the open market as on the date of the notification. The relative situation of the acquired land which is the subject of the sale transaction, the nature of the land, its suitability, nature of the use to which the lands are put to on the date of the notification, income derived or derivable from or any other special distinctive feature which the land is possessed of and the sale transactions in respect of lands covered by the same notification are all relevant factors to be taken into consideration in determining the market value. It is, therefore, the paramount duty of the courts of facis to subject the evidence to very close scrutiny, objectively assess the evidence tendered by the parlies on proper consideration thereof in correct perspective to arrive at adequate and reasonable market value, it is equally relevant to consider the neighbourhood lands as are possessed of similar poteniiality or any advantageous features or any special circumstances available. The Court is required to keep at the back of its mind that the object of assessment is to arrive at reasonable and adequate market value of the lands. In that process, though some guesswork is involved, feats of imagination should be eschewed and mechanical assessment of the evidence should be avoided. As observed by Their Lordships in Special Dy. Collector v. Kurra Sambasiva Rao, . misplaced sympathies or undue emphasis solely on the claimant's right to compensation would place very heavy burden on the public exchequer to which every one contributes by direct or indirect taxes. Whether fair and reasonable and adequate market value is always a question of fact depends on the evidence adduced, circumstantial evidence, and probabilities arising in each case. The guiding star or the acid test would be whether a hypothetical willing vendor would offer the lands and a willing purchaser in normal human conduct would be willing to buy as a prudent man in normal market conditions prevailing in the open market in the locality in which the acquired lands are situated as on the date of the notification under Section 4(1) of the Act; but not an anxious buyer dealing at arm's length with throw-away price, nor facade of sale or fictitious sales brought about in quick succession or otherwise to inflate the market value. The Judge should sit in the armchair of the said willing buyer and seek an answer to the question whether in the given set of circumstances as a prudent buyer he would offer the same market value which the court proposed to fix for the acquired lands in the available market conditions. The court is, therefore, enjoined with the bounden duty of public function and judicial dispensation in determination of the market value of the acquired land and compulsory acquisition. The market value so determined should be just, adequate and reasonable. It must be just equivalent to what the land is capable of fetching in the open market from a willing and prudent buyer.
10. In the light of what is stated above, in the absence of any examination of any one of the parties to the documents, namely. Sale-deeds under Exs. P-13. P-16 and P-17, and all the other documents placed on the side of the claimant cannot be accepted. Though post preliminary notification sale transactions can be considered, we have already held that Exs. P-16 and P-17 failed to satisfy the conditions for acceptance of the values mentioned therein. Except the oral evidence of P.W.1, no other acceptable legal evidence is available for determination of the value of the acquired lands. The amount fixed by the learned Subordinate Judge cannot be sustained and in order to give an opportunity to the claimant, we are of the view that the matter has to be remitted for fresh disposal; accordingly the impugned order of the learned Subordinate Judge is set aside and the matter is remitted to the Court below for fresh disposal. Both parties are permitted to lead additional oral and documentary evidence in support of their respective claim. The learned Subordinate Judge is directed to dispose of the same afresh as stated above within a period of six months from the date of receipt of a copy of this order.
11. With regard to statutory amounts payable to the claimant, we make it clear that the claimant is entitled to 30% solatium only for the market value of the lands acquired. Further, he is entitled to an additional amount at 12% per annum from the date of 4 (I) Notification till the date of passing of Award or delivery of possession, whichever is earlier. In addition to this, the claimant is also entitled to interest at the rate of 9 percent per annum from the date of possession for the period of one year thereafter, at the rate of 15 per cent per annum till the date of deposit.
We also clarify that the claimant is not entitled to interest on solatium and additional amount. We further make it clear that the issue regarding grant of interest on solatium is pending before the Larger Bench of the Supreme Court, depending on the outcome of the decision of the Supreme Court, the claimant is entitled to file an appropriate petition before the competent Sub court.
12. Net result, both the appeal and cross objection are ordered accordingly. No costs.