Kerala High Court
Vellan vs Special Tahsildar (La) on 29 January, 2025
LA.APP.NO.25 OF 2014 1
2025:KER:8246
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE SYAM KUMAR V.M.
WEDNESDAY, THE 29TH DAY OF JANUARY 2025 / 9TH MAGHA, 1946
LA.APP.NO.25 OF 2014
ARISING OUT OF THE JUDGMENT AND DECREE DATED
20.12.2012 IN LAR NO.158 OF 2007 OF SUBORDINATE JUDGES
COURT, SULTHANBATHERY
APPELLANT/CLAIMANT:
VELLAN
S/O.KELU, AGED 78 YEARS
PUTHENMITTOM HOUSE, 16TH MILE,
PADINJARATHARA, PUTHUSSERYKADAVU P.O.,
VYTHIRI TALUK, WAYANAD DISTRICT, PIN: 673 575.
BY ADV. SRI.PHILIP MATHEW
RESPONDENTS/RESPONDENTS:
1 SPECIAL TAHSILDAR (LAND ACQUISITION),
KARAPUZHA BANASURASAGAR IRRIGATION PROJECT,
KALPETTA - 673 122.
2 STATE OF KERALA
REPRESENTED BY THE DISTRICT COLLECTOR, WAYANAD,
KALPETTA, WYANAD DISTRICT - 673 122.
BY ADV.SMT.REKHA C.NAIR, SR.GOVERNMENT PLEADER
THIS LAND ACQUISITION APPEAL HAVING BEEN FINALLY
HEARD ON 29.01.2025, THE COURT ON THE SAME DAY DELIVERED
THE FOLLOWING:
LA.APP.NO.25 OF 2014 2
2025:KER:8246
JUDGMENT
Dated this the 29th day of January, 2025 This Land Acquisition Appeal is filed challenging the judgment dated 20.12.2012 in LAR No.158 of 2007 of the Subordinate Judges Court, Sulthan Battery. Appellant is the claimant in the LAR. Respondents are the respondents therein. (Parties are referred to hereinafter as per their status in the LAR)
2. An extent of 0.1810 hectares (44.72 cents) of dry land comprised in Sy No. 25/10 of Padinjarethara Village was acquired from the claimant for the purpose of Padinjarethara Branch Canal Project coming under the Banasurasagar Project. Section 4 (1) notification under the Land Acquisition Act, 1894 (hereinafter referred to as "the Act of 1894"), was published on 07.08.2003 and the land was taken possession of on 16.03.2005. An Award was rendered by the Land Acquisition Officer on 23.01.2007 fixing a total compensation of Rs.61,191/-. Aggrieved by the compensation and LA.APP.NO.25 OF 2014 3 2025:KER:8246 seeking enhancement, the claimant preferred an LAR No.158 of 2007. He claimed a compensation of Rs.1,24,031/- for coffee plants, Rs.2,40,975/- for pepper vines and a land value of Rs.48,150/- for 0.0130 hectares (3.21 cents) of land @ Rs.15,000/- per cent. The evidence tendered in the LAR comprised of the deposition of the claimant as AW1 and Exts.A1 and A2. Though no oral or documentary evidence was produced by the respondents in the LAR, the reference file was marked as R1 series. The reference court vide the impugned judgment enhanced the compensation to Rs.25,189/- for the entire extent of the land. The land value for 3.21 cents was fixed at Rs.5,000/- per cent and for rest of the land capitalisation/multiplier method was adopted. For the 105 coffee plants an enhancement of Rs.9,568/- was granted and an amount of Rs.5,244/- was granted as an enhancement for 63 pepper vines. Thus a total enhancement of Rs.14,812/- was granted in respect of the coffee and pepper adopting the capitalisation/multiplier method taking 12 as the multiplier. Aggrieved by the said judgment in the LAR, this LAA is filed.
LA.APP.NO.25 OF 2014 4
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3. Heard Sri.Vinay Mathew, Advocate for the claimant (appellant) and Smt.Rekha C.Nair, learned Senior Government Pleader for the respondents.
4. The learned counsel appearing for the claimant submitted that the judgment of the reference court is unsustainable on more than one count. The learned counsel submits that the court erred in appreciating Ext.A1 document, which had been produced by the claimant to substantiate his claim for enhancement. Ext.A1 sale deed was dated 29.03.2003 and revealed a very reliable sale transaction wherein the Kerala State Electricity Board (KSEB) had purchased an extent of 20 cents of land in the very same village situated just 1 km away from the land acquired from the claimant for an amount of Rs.9,155/- per cent. The 4 (1) notification date for the acquisition of land of the claimant was 07.08.2003 which is subsequent to the sale in Ext.A1. Rather than concluding that there would have been an increase in the value of the land, the Sub Court, concluded that the claimant was not able to prove that the acquired land and the land in Ext.A1 are situated adjacent and LA.APP.NO.25 OF 2014 5 2025:KER:8246 comparable. It was concluded that there is no similarity in extent since the land covered in Ext.A1 had an extent of 20 cents and the acquired land had a larger extent of 40 cents. The learned counsel submits that the Sub Court erred in arriving at these conclusions and contended that the documents relied on by the LAO itself would reveal that the claimant's land had road frontage and was situated in a more prominent area closer to an angadi (market), thus entitling an increase in land value as claimed. He places reliance on the dictum laid down in Mohammad Raofuddin v. Land Acquisition Officer [(2009) 14 SCC 367], wherein it was held by the Apex Court that the judgments and awards passed in respect of the acquisition of lands, made in the same village and/or neighbouring villages can be accepted as valid piece of evidence and they provide a sound basis to determine the market value of the land after suitable adjustments with regard to positive and negative factors enumerated in Sections 23 and 24 of the Act of 1894 and with some amount of guesswork. He further contends that the Sub Court erred in mixing both the land value method and capitalisation method while fixing LA.APP.NO.25 OF 2014 6 2025:KER:8246 the compensation amount in the LAR. The Sub Court had adopted the land value method and granted an enhanced compensation of Rs.10,377/- for 3.21 cents (0.0130 hectares) of land acquired and as regards the remaining larger extent of 41.51 cents (0.1680 hectares) of land acquired, the Sub Court had followed the capitalisation (multiplier) method based on the value of bearing coffee plants, pepper vines and the standing trees. The learned counsel submits that this clubbing of two methods by the Sub Court is unsustainable. He places reliance on the dictum laid down by the Supreme Court in Koyappathodi M. Ayisha Umma v. State of Kerala (AIR 1991 SC 2027) wherein it had been held that it would be open to the LAO or the court either to assess the lands with all its advantages as potential value and fix the market value thereof or where there is reliable and acceptable evidence available on record of the annual income of the fruit bearing trees the annual net income multiplied by the appropriate capitalisation of 15 years as it would be a fair method to determine market value, but not both. Placing reliance on the dictum laid down by the Supreme Court in Himmat LA.APP.NO.25 OF 2014 7 2025:KER:8246 Singh and others v. State of Madhya Pradesh and another [(2013) 16 SCC 392], the learned counsel submits that though capitalization of net income method is indeed accepted as one among the different methods when it concerns the same parcel of land, the same ought not to be used simultaneously along with other methods especially when it leads to a substantial detriment to the claimant as in the case at hand where a larger extent of land of 41.51 cents (0.1680 hectares) was assessed under the capitalisation method and small portion of 3.21 cents (0.0130 hectares) of the very same land was assessed under land value method leading to a paltry land value. The learned counsel further contends that even while proceeding under the capitalisation method, the Sub Court had based itself on the purported 'detailed valuation statement' prepared unilaterally, which was part of the reference file and was marked as R1 series and erred on the said count too.
5. Per contra, the learned Senior Government pleader submitted that the claimant having conceded to an assessment and LA.APP.NO.25 OF 2014 8 2025:KER:8246 valuation process which assesses a part of the land on capitalisation method and the rest of the land on comparable land value method cannot now turn around and contend that the said process is unsustainable. Even in the LAR the claim put forth was only that enhancement must be given taking note of the yield of the coffee plants and pepper vines based on the annual income derived from them. The enhancement in land value sought was confined to 3.21 cents (0.0130 hectares) of land and not for the entire extent of 44.72 cents (0.1810 hectares) of land. After having acquiesced to such a process, the claimant cannot now challenge the method followed by the LAO and by the Sub Court in the LAR. The learned Senior Government Pleader further sought to buttress the said contention by pointing out that if the said contention is accepted, the compensation awarded would exceed the amount originally claimed and the same cannot be permitted. It is submitted that the Sub Court had accepted the contention of the claimant that the multiplier to be adopted is 12 and had enhanced the compensation for yielding plants. Hence there is no reason for the claimant to challenge the LA.APP.NO.25 OF 2014 9 2025:KER:8246 said finding. Further, relying on the dictum laid down in State of Kerala v. Madhu Alias Madhavi Amma (1974 KLT 143), it is contended that determination of the market value can be by adopting one of the several accepted modes and there may be cases where more than one of these methods may have to be applied, because adoption of any one of these methods by itself may not be appropriate. Hence the clubbing of the methods adopted by the Sub Court is not per se illegal as contended by the claimant in the appeal, submits the learned Senior Government Pleader. As regards the reliance placed on Ext.A1 sale deed, it is contended by the learned Senior Government Pleader that the property therein is not comparable with the acquired land and hence the rejection of the said document by the Sub Court was valid and tenable. It is thus submitted that the judgment of the Sub Court does not merit any interference and the LAA is fit to be dismissed.
6. After hearing both sides and perusal of the pleadings and documents, it is noted that of a total extent of 44.72 cents (0.1810 hectares) of land had been acquired from the claimant pursuant to LA.APP.NO.25 OF 2014 10 2025:KER:8246 the notification issued on 07.08.2003. The LAO had computed the compensation payable for the yielding crops, which mainly comprised coffee plants (105 in number) and pepper vines (63 nos) which stood on 41.51 cents of the land acquired. No land value was assessed nor any compensation granted for the said extent of land as the same had been compensated based on the yield of crops following the capitalisation (multiplier) method. The yield as derived from the crops had been assessed based on the "Detailed valuation statement" prepared by the concerned officers and the claims put forth by the claimant were not accepted, terming the same to be unsubstantiated. The Sub Court had accepted 12 as the multiplier as contended by the claimant and re-computed the compensation based on the capitalisation/multiplier method. As regards the remaining 3.21 cents (0.0130 hectares) of land of the total 44.72 cents (0.1810 hectares), the method adopted was the comparable land value method and arrived at Rs.5,000/- per cent as the land value thus enhancing the compensation for the said extent of 3.21 cents to Rs.16,050/- and granted an enhanced compensation of LA.APP.NO.25 OF 2014 11 2025:KER:8246 Rs.10,377/-. The correctness of this course adopted and the inherent incongruity of declining compensation for the larger extent of 41.51 cents of the acquired land is highlighted by the counsel for the claimant.
7. After hearing both sides and on consideration of the records, it is noted that the primary issue centres around the quantum of compensation granted and the disparity in the amounts awarded for the same parcel of land based on two different modes or methods of determination of the market value. I find merit in the contention put forth by the claimant that in the peculiar circumstances of the case at hand, mixing together the capitalisation method and comparable land value method of assessment with respect to the same parcel of land has subjected the claimant to substantial prejudice and loss. Further, the compensation payable for the substantial extent of land 44.72 cents was assessed based on the capitalisation (multiplier) method solely relying on the "Detailed valuation statement" prepared by the state officers. Though there may be cases where more than one of these methods LA.APP.NO.25 OF 2014 12 2025:KER:8246 could be applied, the nature of acquired land which is stated to be situated close to a market (angadi) with road frontage does not appear to be the land where a fusion of the modes of market value assessment could be adopted. As laid down by the Hon'ble Supreme Court in Koyappathodi M. Ayisha Umma's case (supra) though it is open to the LAO or the court either to assess the lands with all its advantages as potential value and fix the market value thereof or by the capitalisation method to determine market value, both those methods cannot be used simultaneously unless the reason or factors leading to simultaneous employment of these methods while assessing the market value of the same parcel of land is adequately noted, examined and explained. No such examination or explanation is forth coming in the case of the land acquired from the claimant, either from the LAO or from the Sub Court. It is apparent that the Sub Court had mechanically followed the method adopted by the LAO and had not proceeded to examine the validity or employability of both these methods simultaneously in the matter of the claimant's land. Moreover, the LAO and the Sub LA.APP.NO.25 OF 2014 13 2025:KER:8246 Court proceeded to accept in toto the "Detailed valuation statement"
prepared and produced by the respondent. Even if the claimant had failed to provide substantial evidence regarding the yields from the crops from the acquired land, before proceeding to employ the capitalisation method it was incumbent on the Sub Court to apply its mind to the question of whether the duty of the Government to provide fair compensation to the owners of the acquired property has been satisfactorily met in the facts and circumstances of the case. In New Okhla Industrial Development Authority v. Harnand Singh (deceased) through LRs. and others (2024 SCC OnLine SC 1691), the Hon'ble Supreme Court has opined that for the purpose of evaluating compensation for the acquired land, Section 23(1) of the Act of 1894, acts as a lighthouse. It would hence be relevant to reproduce Section 23(1):
"23. Matters to be considered in determining compensation. -- (1) In determining the amount of compensation to be awarded for land acquired under this Act, the Court shall take into consideration--
first, the market-value of the land at the date of the publication of the notification under Section 4, subsection (1);
secondly, the damage sustained by the person LA.APP.NO.25 OF 2014 14 2025:KER:8246 interested, by reason of the taking of any standing crops or trees which may be on the land at the time of the Collector's taking possession thereof; thirdly, the damage (if any) sustained by the person interested, at the time of the Collector's taking possession of the land, by reason of severing such land from his other land; fourthly, the damage (if any) sustained by the person interested, at the time of the Collector's taking possession of the land, by reason of the acquisition injuriously affecting his other property, movable or immovable, in any other manner, or his earnings;
fifthly, if, in consequence of the acquisition of the land by the Collector, the person interested is compelled to change his residence or place of business, the reasonable expenses (if any) incidental to such change; and sixthly, the damage (if any) bona fide resulting from diminution of the profits of the land between the time of the publication of the declaration under Section 6 and the time of the Collector's taking possession of the land."
8. In Harnand Singh's case (supra), the Hon'ble Supreme Court has held that though the Act of 1894 does not provide a strict definition of the term 'market-value' used therein, it essentially refers to the price that the asset would likely fetch in an open market transaction. The term 'market value' would simply be the price which a willing buyer would give to a willing seller. In other words, that is the price which a willing vendor might be expected to obtain in the market from a willing purchaser. While thus engaged in an exercise LA.APP.NO.25 OF 2014 15 2025:KER:8246 to ascertain the 'market value', as understood above, the courts ought to take note of all aspects that would ensure that fair compensation is given to the owners of the acquired property has been satisfactorily met. Taking recourse to the capitalisation/ multiplier method as well as comparison of land value method for assessment of the market value of a total extent of 44.72 cents (0.1810 hectares) and fixing the compensation for 41.51 cents thereof basing solely on the multiplier method and for the rather miniscule extent of 3.21 cents based on comparison of land value method is, in the context of the land acquired from the claimant, improper and irregular. There is merit in the contention of the claimant that the court below ought to have adopted the land value method for the entire extent of land acquired from the claimant. The Sub Court has held that the exemplar produced by the claimant as Ext.A1 sale deed dated 29.03.2003 is not comparable and hence cannot be relied on. In Shaji Kuriakose and another v. Indian Oil Corporation Ltd. and others [(2001) 7 SCC 650], it has been held by the Hon'ble Supreme Court that for utilizing a sale deed as the LA.APP.NO.25 OF 2014 16 2025:KER:8246 foundation for determining compensation, it is imperative that the sale must satisfy certain criteria of comparability. The factors to be adhered to in this respect have been enumerated as follows:
i. the sale must be a genuine transaction;
ii. the sale deed must have been executed at the time proximate to the date of notification issued under Section 4 of the 1894 Act;
iii. the land covered by the sale must be in the vicinity of the acquired land; and iv. the nature of such land, including its size, must be similar to the acquired land.
9. The Supreme Court has in Bharath Sanchar Nigam Limited v. Nemichand Damodardas and another [2022 (14) SCC 60]; Chimanlal Hargovinddas v. Special Land Acquisition Officer, Poona and another [(1988) 3 SCC 751] and Himmat Singh and others v. State of Madhya Pradesh and another [(2013) 16 SCC 392] elaborated on the positive and negative factors that are to be duly taken note of while assessing the market value LA.APP.NO.25 OF 2014 17 2025:KER:8246 based on exemplars produced.
10. Appreciated on the basis of the above mandates, the exemplar produced as Ext.A1 is seen as related to a purchase made by the KSEB, which buttresses the genuineness of the transaction. The sale was affected prior to the notification of the acquisition of the claimant's land, and the property is situated in the same village within 1 km of the acquired land. The reliance placed by the claimant on the dictum laid down in Mohammad Raofuddin (supra) cannot be termed as out of place. As regards the nature of the land, apparently, the land acquired from the claimant is better situated as it has a road frontage and is also closer to a market (angadi). Indeed, the extent of the land acquired from the claimant is 40 cents whereas the land covered by Ext.A1 is only 20 cents. The variance in extent though cannot be said to be substantial, the same ought to be weighed in while making an assessment based on Ext. A1. In view of the above, there is no reason to entirely discard Ext. A1 sale deed produced by the claimant as an exemplar. It is hence found fair and reasonable to resort to the settled principle of guesstimation LA.APP.NO.25 OF 2014 18 2025:KER:8246 taking note of the facts and circumstances that emerge on the basis of the available evidence and pleadings. [See Trishala Jain and another v. State of Uttaranchal and another (2011) 6 SCC 47)].
11. It has been contended by the learned Senior Government Pleader that if the contention of the claimant is accepted, the compensation awarded would exceed the amount originally claimed and the same cannot be permitted. It is trite that there may be situations where the amount higher than claimed, could be awarded to the claimant and there is no blanket prohibition in the said respect. (See. Bhag Singh and others v. Union Territory of Chandigarh [(1992) 4 SCC 692], Krishi Utpadan Mandi Samiti v. Kanhaiya Lal and others [(2000) 7 SCC 756]; Ashok Kumar and another v. State of Haryana [(2016) 4 SCC 544].
12. The course of action adopted by the FAO and the Sub Court, whereby a fusion of both capitalisation/ multiplier method as well as comparison of land value method for assessment of the market value of a total extent of 44.72 cents (0.1810 hectares) and fixing the compensation for 41.51 cents thereof basing solely on the LA.APP.NO.25 OF 2014 19 2025:KER:8246 multiplier method and for the rest 3.21 cents assessment based on comparison of land value method is improper and irregular. The land value method has to be followed for the entire extent of land acquired from the claimant. Though the claimant has sought Rs.15,000/- per cent as the land value, the same has not been reliably substantiated. However, Ext.A1 sale deed evidencing a purchase by the KSEB is found reliable and meets the mandates as laid down in Shaji Kuriakose's case (supra). Accordingly, the amount of Rs.9,155/- per cent which is the consideration per cent paid in Ext.A1 is fit to be adopted as the land value for the entire extent of 44.72 cents (0.1810 hectares) of land acquired from the claimant. The perceivable advantages that the acquired property possesses due to its road access and its being located closer to the market have been factored in with the difference in extent between the two properties.
13. In the light of the above analysis, the claimant shall be entitled to land value at the rate of Rs.9,155/ - per cent for 44.72 cents (0.1810 hectares) of land acquired from him situated in LA.APP.NO.25 OF 2014 20 2025:KER:8246 Sy.No.25/10 of Padinjarethara Village. The land value awarded in LAR No.158 of 2007 vide judgment dated 20.12.2012 of the Subordinate Judge's Court, Sulthan Battery is thus revised to Rs.9,155/- per cent commensurate to the extent of land acquired. The claimant will be entitled to all statutory benefits admissible in law. No costs.
The LAA is allowed.
Sd/-
SYAM KUMAR V.M. JUDGE csl