Madras High Court
The Land Acquisition Officer vs M.Mahalingam on 6 April, 2010
Author: R.Banumathi
Bench: R.Banumathi, M.Venugopal
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 06.04.2010
CORAM :
THE HONOURABLE Mrs.JUSTICE R.BANUMATHI
and
THE HONOURABLE Mr.JUSTICE M.VENUGOPAL
A.S.Nos. 386 & 387 of 2000
and
CMP.No.1710/2010 in A.S.No.386/2000 & CMP.No.1711/2010 in A.S.No.387/2000
and
Cross Objection Nos.94/2002 and 54/2003 in A.S.No.386/2000
A.S.Nos.386 & 387 of 2000:
1. The Land Acquisition Officer
and the Special Tahsildar,
Land Acquisition,
Bye-pass Road, Namakkal.
2. The Divisional Engineer,
National Highways,
Salem-5.
3. National Highways Authority of India,
Ministry of Shipping, Road Transport
and Highways,
rep. by its Project Director and
General Manager. ... Appellants in both
Appeals.
[3rd Appellant impleaded as per
order of the Court dated 16.12.05
made in CMP Nos.18404,
18405 and 18448/2005]
vs.
M.Mahalingam ... Respondent/Claimant in
A.S.No.386/2000
M.Mahalingam
V.Mayilvaganam ... Respondents/Claimants in
A.S.No.387/2000
Cross Objection No.94 of 2002:
M.Mahalingam ... Cross Objector.
vs.
1. The Land Acquisition Officer and
Special Tahsildar,
Land Acquisition,
Bye-pass Road,
Namakkal.
2. The Divisional Engineer,
National Highways,
Salem-5. ... Respondents.
Cross Objection No.54 of 2003:
M.Mahalingam
V.Mayilvaganam ... Cross Objectors.
vs.
1. The Land Acquisition Officer and
Special Tahsildar,
Land Acquisition,
Bye-pass Road,
Namakkal.
2. The Divisional Engineer,
National Highways,
Salem-5. ... Respondents.
CMP.No.1710/2010 in A.S.No.386/2000 & CMP.No.1711/2010 in A.S.No.387/2000:
National Highways Authority of India,
rep. by its Project Director
Ministry of Road Transport & Highways
No.10, Kamadhenu Nagar,
Karur. ... Petitioner/3rd Appellant.
vs.
1. The Land Acquisition Officer and
Special Tahsildar,
Land Acquisition,
Bye-pass Road,
Namakkal.
2. The Divisional Engineer,
National Highways,
Salem-5.
3. M.Mahalingam
4. V.Mayilvaganam. ... Respondents.
Prayer: Appeals filed under Section 54 of Land Acquisition Act against the Common Judgment made in LAOP.Nos.7 and 8/1996 dated 28.04.1999 on the file of Subordinate Judge, Namakkal.
Prayer: Cross Objections filed under Order 41, Rule 22 CPC to set aside the disallowed portion of decree and judgment in L.A.O.P.Nos.7 and 8 of 1996 dated 28.04.2000 on the file of Sub-Court, Namakkal.
Prayer: Petitions filed under Or.41, Rule 27 CPC praying to receive the documents filed along with the Petitions.
For Appellants 1 & 2 : Mr.V.Ravi
both the appeals Special G.P. [AS]
For 3rd Appellant in : Mr.M.Ravindran,
both the appeals Addl. Solicitor General
assisted by
M/s.P.Wilson Associates
For Respondents/ : Mrs.Nalini Chidambaram
Claimants Senior Counsel
for
M/s.Gladys Daniel
COMMON JUDGMENT
R.BANUMATHI,J Feeling aggrieved by the enhancement of compensation from 0.79 Paise to Rs.75/- per sq. ft. in respect of the lands acquired in Vallipuram village, Namakkal Taluk for formation of bye-pass road to Namakkal town, the Special Tahsildar and National Highways Authorities of India have filed these Appeals. Since, both the appeals and cross-objections arise out of common order and the points for consideration are one and same, both the Appeals were taken up together and disposed of by this Common Judgment.
2. Large extent of lands were acquired for formation of bye-pass road to Namakkal town having length of about 8 Kilometers. An extent of 11.47.0 Hectares of lands in Vallipuram village in various sub-divisions comprised in S.F.Nos.123, 124, 125, 127, 128, 129, 131, 135, 136, 233, 235 237, 244, 245, 251, 253, 254 and 255 were acquired. Sec.4(1) notification was approved in G.O.No.1242 P.W. (Highways) H.P.1 dated 24.8.1993 and published in Tamil Nadu Government Gazette on 22.9.1993. Sec.4(1) notification was also published in Tamil newspapers viz., "Makkal Kural" and "Kumari Murasu" on 23.9.1993 and the substance of the above notification was also published in the village on 25.10.1993. Sec.5-A enquiry was conducted on 15.04.1994. Sec.6 notification was published in the Government Gazette on 20.07.1994 and in the newspapers on 21.07.1994 and substance of the said notification under Sec.6 was also published in the locality on 08.08.1994.
3. To determine the market value of the lands under acquisition, sales statistics for the period of three years from 25.10.1990 to 24.10.1993 have been gathered. Totally 95 sales had taken place during the said period. Land Acquisition Officer [LAO] has examined those sale deeds for fixing the market value for the lands under acquisition. Except the lands covered in Sl.No.16 in the sales statistics, the other sales were discarded on the ground that they are far away from the lands under acquisition or that the rates do not reflect the prevailing rate of lands under acquisition. Under sale deed [Sl.No.16] dated 08.06.1991 [Document No.829] an extent of 1.27.5 Hectares (or) 3.15 acres comprised in Dry S.Nos.277/3A1, 3B, 5A and 5B of Vallipuram village has been sold for Rs.75,000/- i.e. per Hectare Rs.58,823/- i.e., Rs.23,814/- per acre. LAO was of the view that land in S.Nos.277/3A1, 3B, 5A and 5B is identical to the Manavari Dry lands under acquisition. Hence, the above sale which took place in S.Nos.277/3A1, 3B, 5A and 5B has been taken as basis for fixing the market value for the Manavari Dry lands under acquisition and fixed the value at Rs.58,823/- per hectare for Manavari Dry lands.
4. In so far as irrigated Dry lands, an extent of 1.21.5 Hectares (or) 3.01= acres comprised in S.No.254/3, 6, 8A of Vallipuram village has been sold for Rs.75,000/- under Document No.949 dated 28.06.1991 which means Rs.61,475/- per Hectare (or) Rs.24,888/- per acre. LAO was of the view that land in S.F.Nos.254/3, 6, 8A and the Dry lands under acquisition are identical in all respects and therefore, the above sale which took place on 28.6.1991 [Document No.949] has been taken for fixing the market value for the irrigated Dry lands under acquisition and fixed the value at Rs.61,475/- per hectare. Fixing the above value for Manavari and irrigated Dry lands, Award No.3/1995 was passed ordering 30% solatium, 12% additional market value from 25.10.1983 to 05.10.1995. LAO has also fixed appropriate value for the trees in the acquired lands.
5. On objection raised by the land owners, reference under Sec.18 of the Land Acquisition Act was made. References were taken on file as LAOP.Nos.7 and 8/1996. In the Reference Court, both the LAOPs were taken up together and disposed by common order on 28.04.1999. Before the Reference Court, the Special Tahsildar [Land Acquisition] and the Divisional Engineer, National Highways, Salem alone were Respondents. The Requisitioning Body/Beneficiary for which the lands were acquired viz., National Highways Authorities of India [NHAI] was not made as a party.
6. In the Reference Court, Claimant Mahalingam-Power Agent [Claimant in LAOP.No.7/1996 and 1st Claimant in LAOP.No.8/1996] was examined as CW1 and purchasers of adjacent land were examined as CWs.2 to 8 respectively. On the side of Claimant, Exs.C1 to C24 were marked. One Chandrasekaran, the Special Tahsildar [LAO] was examined as RW1. Exs.R1 to R3 were marked.
7. Reference Court has taken Ex.C3-sale deed [Document No.1369 dated 25.8.1993] in which 600 sq. ft. comprised in S.F.Nos.251/2A2, 2B2, 2A1, 2B1 was sold for Rs.45,000/- by Ramachandran, Power of Attorney of one Doss infavour of one Marimuthu and fixed the market value of the acquired lands at Rs.75/- per sq. ft. Reference Court has also referred to Ex.C2- sale deed [19.1.1993] in which an extent of 500 sq. ft. in S.F.Nos.251/2A1, 2B1, 2A2, 2B2 was sold for Rs.50,000/-/. After taking Ex.C3-sale deed for fixing the market value, Reference Court ordered (i) enhancement of compensation from 0.79 Paise to Rs.75/- per sq. ft.; (ii) 30% solatium on the enhanced market value; (iii) 12% additional market value from 25.10.1993 to 05.10.1995; (iv) interest at the rate of 9% for one year from the date of taking possession; and (v) thereafter interest at the rate of 15% p.a. till the date of realisation.
8. Challenging the enhancement of compensation, the LAO/Special Tahsildar[LA] and the Divisional Engineer, National Highways [not National Highways Authorities of India] have preferred these Appeals. In the Appeals, on Petition filed by the National Highways Authorities of India Requisitioning body, National Highways Authorities of India was impleaded as 3rd Appellant.
9. Main contention of learned Additional Solicitor General is that to determine just and proper compensation the Beneficiary National Highways Authorities of India ought to have been made as a party. It was further submitted that though the Divisional Engineer, National Highways was one of the Respondent in the LAOPs, there was no representation for National Highways Authorities of India. Main plank of argument of the Appellants is that without proper and effective representation of NHAI, the compensation amount was enhanced prejudicially affecting the interest of National Highways Authorities of India/Union of India which has to bear the heavy compensation.
10. Drawing our attention to the additional documents filed in the C.M.Ps., Mr.M.Ravindran, learned Additional Solicitor General submitted that even from 1991, there were protests and demonstrations in and around Namakkal for forming bye-pass road to Namakkal town and that after knowing about the scheme for formation of bye-pass road, land owners have brought into existence the sale deeds boosting the land value and the considerations stated in Exs.C3 and C2-sale deeds are fancy value to make a boosted claim for compensation. Taking us through the sales statistics and also the sale deeds infavour of Ashok Leyland Company, learned Additional Solicitor General has submitted that there was only slow increase in price of the lands and the sudden spurt in the value of the land was boosted as it was after the grant of administrative sanction for formation of bye-pass road to Namakkal town.
11. Learned Additional Solicitor General further argued that if the additional documents are received in evidence, it would be evident that Exs.C3 and C2-sale deeds were brought into existence boosting the value by Mahalingam and Mayilvaganan. It was further argued that when large extent of land is acquired, there cannot be determination of market value on square feet basis and the enhancement of compensation at Rs.75/- per sq. ft. is not supported by any objective assessment. It was also urged that for formation of highways, National Highways Authorities of India has spent huge amount for laying road and developing it and while so, Reference Court erred in not making any deduction for development charges.
12. We have also heard Mr.V.Ravi, learned Special Government Pleader [AS] appearing for the Appellants 1 and 2 submitted that LAO has taken the relevant sale deed which is prior to Sec.4(1) notification and has rightly fixed the market value at 0.79 Paise per sq. ft. and while so, Court below erred in relying upon Ex.C3-sale deed without any basis. Learned Special Government Pleader placed reliance upon (1997) 9 SCC 330 [P.Rajan and another v. Kerala State Electricity Board and another] and AIR 1995 SC 1004 [M/s.Neyveli Lignite Corpn. Ltd., v. Special Tahsildar (Land Acquisition], Neyveli and others]. Placing reliance upon (1996) 6 SCC 41 [Special Deputy Collector and another v. Kurra Sambasiva Rao and others], the learned Special Government Pleader contended that it is the bounden duty of the Court to determine the market value on an objective assessment of the conditions prevailing in the open market and the value fixed by the Reference Court is exorbitant.
13. Laying emphasis upon Ex.C3-sale deed, Ms. Nalini Chidambaram, learned Senior Counsel appearing for the Claimants contended that under Exs.C3-sale deed, the land was sold at the rate of Rs.75/- per sq. ft. and Reference Court has rightly taken the market value at Rs.75/- per sq. ft. and even in January 1993, it was sold for Rs.100/- per sq. ft. It was further argued that merely because some persons were agitating for forming bye-pass road, it cannot be the ground to hold that the value was boosted in Ex.C3 and C2-sale deeds. It was contended that Ex.C3-sale deed is said to have been preceded by an agreement - Ex.C12 dated 22.12.1992 under which Plot No.83 comprised in S.F.Nos.251.2A2, 2B2, 2A1, 2B1 measuring an extent of 600 sq. ft. was agreed to be sold for Rs.45,500/-. Stand of Respondents-Claimants is that Ex.C3-sale deed was preceded by an agreement which lends assurance to Ex.C3-sale deed. Learned Senior Counsel further argued that the potential value of the land has to be kept in view and no rebuttal evidence was adduced by the Appellants and the acquired lands are in the midst of developed area and the value prior to Sec.4(1) notification was rightly taken into consideration by the Reference Court. Learned Senior Counsel would submit that the lands situated nearby the acquired lands were already purchased by Ashok Leyland Company and therefore, the market value fixed by the Reference Court cannot be said to be exorbitant or on the higher side.
14. We have carefully examined the submissions of learned Additional Solicitor General and learned Special Government Pleader and also learned Senior Counsel for Claimants.
15. Lands measuring 11.47.0 Hectares in Vallipuram village in various sub-divisions comprised in S.F.Nos.123, 124, 125, 127, 128, 129, 131, 135, 136, 233, 235 237, 244, 245, 251, 253, 254 and 255 have been acquired for formation of bye-pass road to Namakkal town. Vallipuram is a ryotwari village. To determine the market value of the lands under acquisition, sale statistics for the period of three years from 25.10.1990 to 24.10.1993 were gathered and there were totally 95 sales during the said period in the village. Upon careful analysis of the said sales, it is seen that under Sl.No.5 sale deed dated 12.03.1991 an extent of 1258 sq. ft. comprised in S.F.No.251/2A1 and 2B1 was sold by Mahalingam and others to one Viswanath for Rs.1000/- i.e. 0.79 Paise per sq. ft. Analysis of various sale deeds contained in the sales statistics would show that there was only slow increase in the value of the lands as is seen from the following:-
Sl.No Doc. No. and Date S.F.No. Extent sold Name of Vendor Name of Vendee Sold at Rs.
Rate per Hectare Rs.5 369
12.03.1991 251/2A1, 2B1 1258 sq. ft.
Mahalingam and others Viswanath 1000/-
0.79 Paise 6 371 12.03.1991 251/2A1, 2B2 3500 sq.ft.
Kaliammal and others Jeganathan 12,000/-
3.43 8 625 25.04.191 251/2A1, 2B1, 2B2 3000 sq.ft.
Mayilvaganam and others Kambalathan Chettiar 10,000/-
3.33 10 677 03.05.1991 251/2A1, 2B1 1600 sq.ft.
Mahalingam and others Aushgar Basha 5600/-
3.50 11 713 08.05.1991 251/2A1, 2B2, 2A1, 2B1 1500 sq.ft.
Mayilvaganam and others Raju 5000/-
3.33 19 883 14.06.1991 251/2A1, 2B1 1500 sq.ft.
Mahalingam Saravanan 6000/-
4.00 32 1005 12.07.1991 251/2A2,2B1, 2B2, 2A2 1475 sq.ft.
Mahalingam Gnanasekaran 15,000/-
10.16 36 1205 05.09.1991 251/2A2, 2B2, 2A1, 2B1 1500 sq.ft.
Mayilvaganam Subramanian 15,000/-
10.00 48 1507 30.10.1991 251/2A1,2B1, 2A2, 2B2 412= sq.ft.
Mahalingam and others Saravanan 6,200/-
15.05 65 898 15.06.1992 251/2A2, 2B2, 2A1, 2B1 1500 sq.ft.
Mayilvaganam and others Kumarasamy 22,500/-
15.00 71 1554 21.10.1992 251/2A2, 2B2 1500 sq.ft.
Mayilvaganam Kanagaraj 30,000/-
20.00 By analysis of the above sales, it is clear that there was only very slow increase in the value of the lands. Most of the sale transactions pertaining to house sites were sold only by Claimants-Mahalingam and Mayilvaganan and rest of the transactions were predominantly of agricultural lands.
16. Serial No.76 [Ex.C2] of sales statistics is the sale deed dated 19.1.1993 in which an extent of 500 sq. ft. comprised in S.F.No.251/2A1, 2B1, 2A2, 2B2 was sold by Saravanan and others to one Jawahar for Rs.50,000/- i.e. Rs.100/- per sq. ft. Like wise, Serial No.93 [Ex.C3] is the sale deed dated 25.8.1993 in which an extent of 600 sq. ft. was sold by Ramachandran infavour of Marimuthu for Rs.45,000/- i.e. Rs.75/- per sq. ft. Leaving all the documents for a period of three years where the land value was lesser ranging from Rs.3/- to Rs.20/-, curiously the Reference Court has taken Ex.C3-sale deed as basis for fixing the market value. For taking Ex.C3-sale deed, Reference Court has observed that Ex.C3 is prior to Sec.4(1) notification and therefore, Ex.C3-sale deed is taken as basis for fixing the market value. The value fixed by the Reference Court is not based on any objective assessment.
17. Under Ex.C6 (24.04.1991), Mahalingam has obtained Power of Attorney from one Kaliammal and others. Like wise, under Ex.C7 (30.1.1991), Mayilvaganan has obtained Power of Attorney from one Parvathi and others. As pointed out earlier, by analysis of sales statistics, Claimants-Mahalingam and Mayilvaganan who got power from land owners were selling small extent of house sites and most of the sale transactions in the sales statistics are sale deeds executed by Claimants-Mahalingam and Mayilvaganan. In Serial No.29 sale deed dated 01.07.1991, an extent of 600 sq. ft. comprised in S.No.251/2A2, 2B2, 2A1, 2B1 was sold by Mayilvaganam infavour of Doss for Rs.6000/- i.e. Rs.100/- per sq. ft. Under Ex.C3 [sale deed dated 25.8.1993], Power Agent of the said Doss viz., Ramachandran had sold an extent of 600 sq. ft. in S.F.No.251/2A2, 2B2, 2A1, 2B1 to one Marimuthu for Rs.45,000/- i.e. Rs.75/- per sq. ft.
18. For quite some time, from May 1991 there was a demand for bye-pass road to Namakkal town. From one of the pamphlets filed by National Highways Authorities of India as additional documents, it is seen that from 1991, there were protest and demonstrations in and around Namakkal for forming bye-pass road to Namakkal town. Additional documents are also produced in Petitions filed under Or.41, Rule 27 CPC to show that administrative sanction [C.No.45/93/JDO dated 09.01.1993] was granted for the estimate of Rs.83.11 lakhs for formation of Namakkal bye-pass road. When the above Proceedings of administrative sanction was issued in January 1993 giving details of extent of lands to be acquired in various villages, by the said Proceedings dated 09.01.1993 the project has taken final shape. In such circumstances under Serial No.76, a small extent of 500 sq. ft. in S.F.Nos.251/2A1, 2B1, 2A2, 2B2 was sold by one Saravanan and others infavour of Jawahar under Ex.C2 sale deed dated 19.1.1993 for Rs.50,000/- i.e. Rs.100/- per sq. ft. As rightly contended by Mr.M.Ravindran, learned Additional Solicitor General, serious doubts arise as to genuineness of the transaction of Exs.C3 and C2-sale deeds. Reference Court appears to have fixed the value unmindful of fact that there was long standing agitation to form bye-pass road from 1991.
19. Laying emphasis upon the sale deeds infavour of Ashok Leyland Company, the learned Senior Counsel for Claimants contended that Ashok Leyland Company and TVS Group have purchased the property in S.F.Nos.276, 277 and 278, the value of the lands nearby the acquired lands has gone up and Reference Court has rightly fixed the value of the land at Rs.75/- per sq. ft.
20. There is no force in the contention that the value of the land had substantially gone up after Ashok Leyland Company had purchased the property. In the sales statistics, Serial Nos.80 to 86 are the sale deeds dated 29.03.1993 under which an extent of land ranging from 4.40 acres to 2.61 acres was sold by Namakkal Auto Nagar Association to Ashok leyland Company and as per the said sale deeds, rate per Hectare is Rs.1,11,000/-. The details of lands sold to Ashok Leyland Company are as under:-
Sl.No Doc. No. and Date S.No. Extent sold in acres Name of Vendor Name of Vendee Sold at Rs.
Rate per Hectare Rs.80 544
29.03.1993 274/7, 3, 2C, 9 275/1, 2 276/13B 4.40 Namakkal Auto Nagar Association Ashok Leyland Company 1,97,838/-
1,10,000/-
81 54529.03.1993 276/11, 12A 277/13B 4.35 Namakkal Auto Nagar Association Ashok Leyland Company 1,95,624/- [After enquiry value was fixed at 2,36,260/-
1,11,000/-
82 54629.03.1993 276/2B, 13A 277/3B 3.63 Namakkal Auto Nagar Association Ashok Leyland Company 1,63,391/-
1,11,000/-
83 54729.03.1993 277/1, 2, 5A & 5B 3.51 Namakkal Auto Nagar Association Ashok Leyland Company 1,57,829/-
1,11,000/-
84 54829.03.1993 278/2 293/2 3.98 Namakkal Auto Nagar Association Ashok Leyland Company 1,78,947/-
1,11,000/-
85 54929.03.1993 278/3 2.61 Namakkal Auto Nagar Association Ashok Leyland Company 1,17,261/-
1,11,000/-
86 55029.03.1993 278/3 2.62 Namakkal Auto Nagar Association Ashok Leyland Company 1,17,819/-
1,11,000/-
21. The sale deed [Document No.545 dated 29.03.1993] presented for registration by Ashok Leyland Company was not registered on the ground that it was undervalued. After enquiry, the land value was fixed at Rs.2,36,260/- i.e. Rs.1.25 per sq. ft. and deficit stamp of Rs.4149/- and registration fee of Rs.345/- were collected from Ashok Leyland Company. So even after enquiry for under valuation, the value fixed was only Rs.1.25 per sq. ft. and not a higher value as contended by the Claimants.
22. By analysis of the sale deeds infavour of Ashok Leyland Company, three things are emerge:-
Large extent of lands were sold on the basis of value per Acre.
Per Hectare value is Rs.1,11,000/- that means Rs.44,939/- rounded to Rs.44,940/- per acre which means more or less Rs.1.03 per sq. ft.
Even after enquiry, the value was fixed at Rs.2,36,260/- i.e. Rs.1.25 per sq. ft.
If we examine Exs.C3 and C2-sale deeds where the consideration is stated as Rs.75/- and Rs.100/- respectively per sq. ft. vis-a-vis purchases by Ashok Leyland Company, without any fear of contradiction, it can be concluded that Exs.C3 and C2 are nothing but boosted value.
23. Our view is fortified by another sale deed where the land was sold for industrial purpose. If we take Serial No.78 sale deed dated 05.03.1993, an extent of 0.38= cent in S.F.No.303/2 was sold by one Muthusami to Nallusami for industrial purpose for Rs.20,000/- which means per Hectare Rs.1,29,000/- i.e. Rs.52,226/- per acre [Rs.1.19 rounded to Rs.1.20 per sq. ft.].
24. Ex.C11 [26.02.1993] is an agreement by Mayilvaganan and others agreeing to sell 0.75.0 Hectares in S.F.Nos.251/2A1, 2A2, 2B1, 2B2 at the rate of Rs.200/- per sq. ft. Claimants have produced number of agreements of sale Exs.C8 to C11 (23.2.1993 and 26.2.1993) by Mayilvaganan and Mahalingam who got Power of Attorney agreeing to sell the properties at the value of Rs.200/- per sq. ft. Placing reliance upon 1996 LACC 232 [Puvvada Nageswara Rao and others v. The Land Acquisition Officer and Revenue Divisional Officer, Ongole], it was contended that reliance can be placed on the agreements to sell and the Reference Court ought to have fixed the value at Rs.200/- per sq. ft. In the said decision, the Division Bench of Andhra Pradesh High Court held that reliance can be placed upon the agreements to sell if they are found to be not merely for claiming higher compensation. In the said case before the Andhra Pradesh High Court, the agreements were registered much prior to issuance of notification and not merely for claiming higher compensation. In the instant case, Ex.C11 is an unregistered agreement by Mayilvaganan and others. National Highways Authorities of India had no chance to meet the agreement [Ex.C11] to bring home the point whether Ex.C11 could be relied upon or not.
25. Under Sec.23(1) of the Act, the Court has to determine the market value of the land. One of the methods of valuation is the price paid, within a reasonable time, in bonafide transactions of purchase of land acquired, or of the land adjacent to the land acquired having similar advantages. Such transactions of sale indicate the price of the land acquired on the date of the notification. The Court has to consider whether or not any particular transaction of sale affords a fair criterion of the market value of the land acquired.
26. By perusal of documents now filed as additional documents, there had been protests and demonstrations even from 1991 for forming bye-pass road to Namakkal town. Administrative sanction was granted vide Proceedings C.No.45/93/JDO dated 09.01.1993 . Exs.C3 and C2-sale deeds are after the administrative sanction. All the agreements Exs.C8 to C11 were entered in February 1993. Exaggeration of value is evident from the fact that from January to February 1993, the value shoot up by double the time i.e. Rs.100/- to Rs.200/- per sq. ft. Reference Court was swayed by Exs.C3 and C2-sale deeds and does not appear to have carefully examined Exs.C3 and C2-sale deeds which are not compatible with the trend of slow increase of the land value.
27. In this case, large extent of lands were acquired for formation of bye-pass road to Namakkal town. In his evidence, RW1 has stated that the lands acquired are very far away from the village and that the layouts are un-approved layouts. RW1 further stated that the data land and the acquired lands are of the same taram and quality and the value fixed by the Land Acquisition Officer is just and reasonable one.
28. Viewed from any angle, the value fixed by the Reference Court at Rs.75/- per sq. ft. is exorbitant and very much on the higher side. The various aspects like demonstration for formation of bye-pass road to Namakkal town from 1991 and other relevant aspects would have been brought forth before the Reference Court had the Beneficiary/Requisitioning Body - National Highways Authorities of India been was impleaded. Without impleading the National Highways Authorities of India in the LAOPs and without any basis, Reference Court had fixed the market value of the acquired lands on the higher side unmindful of financial implications.
29. Yet another material aspect is relevant to be noted. When large extent of lands were acquired for formation of bye-pass road to Namakkal town and when the acquired lands are far away from Namakkal town, Reference Court erred in determining the value of the land per square feet. Holding that when large extent of lands are acquired, determination of value on the square feet basis is a wrong principle and market value could be fixed only per acreage or per cent, in (1997) 9 SCC 330 [P.Rajan and another v. Kerala State Electricity Board and another], the Supreme Court held as under:-
"When a large extent of land is acquired, determination of compensation on the foot of a cent, square yard or square foot is a wrong principle. The principle of fixation on acreage basis would be the correct principle. If the land acquired is situated in a developed area and is converted into buildings in a colony after obtaining sanction from the competent authority or is situated in a well-developed area like in the heart of a commercial centre, determination of the compensation could be on square yard basis after giving due deduction according to law. Determination on square foot basis would be confined only to highly developed commercial land or land situated at a place in the heart of a city like Nariman Point in Bombay or Connaught Place in Delhi."
30. Yet another infirmity in the Judgment of Reference Court is also to be noted. Large block of land will have to be developed for formation of bye-pass road. Even though, Highways is a strip for which common space like roads, drainage and other common space may not be required yet like any other scheme, huge amount will have to be spent for formation of road i.e. place has to be treated and side ways are to be formed and for forming Highways and developing proper infrastructure huge amount will have to be spent. This factor can be balanced only by making a deduction by way of allowance at an appropriate rate ranging approximately between 20% to 50% to account for the land required to be set apart for forming bye-pass road. As pointed out earlier, though the Reference Court has fixed the market value at Rs.75/- per sq. ft. no percentage of deduction for development charges was made. More over, we do not find that any development had taken place in the acquired land as on 4(1) notification. No piece of evidence has been produced by the Claimants showing that the alleged layout has been approved by the competent authority and that the lands were converted as house sites prior to 4(1) notification. Ex.C19 is not an approved layout plan but just a plan. In our considered view, the reasons assigned by the Reference Court for not making deduction towards the development charges is not convincing and cannot be sustained.
31. National Highways Authorities of India necessary party : non-impleading of Beneficiary/NHAI in LAOPs:-
In the LAOPs, the Respondent was only the State Government i.e. the Land Acquisition Officer and the Divisional Engineer, National Highways, Salem. Requisitioning Body National Highways Authorities of India who has to pay compensation was not made a party. Only if National Highways Authorities of India had been made as a party being Requisitioning Body, NHAI would have put forth their objection by filing counter and by adducing evidence.
32. Learned Senior Counsel Ms.Nalini Chidambaram submitted that Divisional Engineer was already a party and even though opportunity was given, the Government neither chose to file any documents showing lesser land value nor elaborately cross examined the Claimants. It was further contended that after the purchase of lands by Ashok Leyland Company and TVS Group, the value of the land had naturally gone up and based upon Ex.C3-sale deed, Reference Court has rightly fixed the market value at Rs.75/- per sq. ft.
33. The contention of National Highways Authorities of India is that the acquisition not having been for Tamil Nadu State Government but for the National Highways Authorities of India and therefore, it was incumbent on the Reference Court to issue notice to the 3rd Appellant National Highways Authorities of India before considering the claim of the Claimants for enhancement of compensation. Even though, the Divisional Engineer, National Highways, Salem was shown as 2nd Appellant, the said Divisional Engineer is stated to be to the Divisional Engineer of National Highways who was represented by State Government Pleader himself. It cannot be disputed that Requisitioning body National Highways Authorities of India was not made as a party in the LAOPs nor any opportunity was afforded to National Highways Authorities of India to adduce evidence.
34. Section 20 (c) makes it obligatory for the Court to issue notice to the person or authority for whose benefit the acquisition is made. Sec.20 of Land Acquisition Act reads as follows:
20. Service of notice. - The Court shall thereupon cause a notice, specifying the day on which the Court will proceed to determining the objection, and directing their appearance before the Court on that day, to be served on the following persons, namely :
(a) the applicant;
(b) all the persons interested in the objection, except such (if any) of them as have consented without protest to receive payment of the compensation awarded; and
(c) if the objection is in regard to the area of the land or to the amount of the compensation, the Collector.
35. The Court having seisin of the reference is empowered under Sec.20 of the Act to direct appearance before him not only of the: (a) applicant that is applicant for reference but also; (b) all persons interested in the objection except such (if any) of those as have consented without protest to receive payment of the compensation awarded. The term "interested" in Clause (b) is wide enough to include both, the persons interested in supporting, or opposing the applicant, that means, Cl. (b) must have reference to parties having conflicting claims to the compensation either whole or partly, as against the applicant and otherwise. The Court therefore, had power, irrespective of any reference in that behalf, to investigate the claims.
36. The scheme of the Act makes it clear that when the land is acquired for the Government, it is only the Requisitioning Body is expected to participate in the proceedings and to safeguard the interest of the Government for whom the land is acquired. If the Government for whom the land is acquired can be regarded as a "person interested" in the reference, there is no need to have an independent provision like Clause (c) of Section 20 giving right to the person or authority other than the Government of being notified and participating in the proceedings. Further, it is not reasonable to presume that the legislature intended to make a redundant provision in Clause (c) of Section 20 of the Act.
37. Sec.54-A of Land Acquisition Act was inserted by the Tamil Nadu State by the Land Acquisition (Tamil Nadu Amendment) Act, 1996 (Tamil Nadu Act 16 of 1997), so as to enable to implead the requisitioning body as a party in the cases filed before the High Court. Sec.54-A reads as under:-
"54-A. Service of notice by High Court.- Notwithstanding anything contained in the Code of Civil Procedure, 1908 (Central Act V of 1908), the High Court, before which an appeal has been filed under Section 54, shall cause a notice, specifying the date on which such Court will proceed to hear the case and directing the appearance before such Court on that day, to be served on the person or authority also, other than the Government, for whom the acquisition is made."
Only if the requisitioning body is impleaded as party, it could put forth its point/objection through counter-affidavit.
38. Observing that it was mandatory on the part of Reference Court to have caused a notice on the Requisitioning Body before proceeding to determine the compensation, in (1990) 3 SCC 617 [Neelagangabai and another v. State of Karnataka and others], the Supreme Court has held as under:-
"Admittedly the land was acquired for the purpose of the Respondent-Corporation and the burden of payment of the compensation is on the Corporation. In this background the High Court has held that it was mandatory for the Court of reference to have caused a notice served on the respondent-Corporation before proceeding to determine the compensation claim. Since no notice was given to the respondent-Corporation and it was thus deprived of an opportunity to place its case before the Court, the judgment rendered ion the reference case was illegal and not binding on the Corporation".
39. The Authority or Company for whose benefit the land was acquired who is a beneficiary is necessary party. Holding that beneficiary is a necessary party, in AIR 1995 SC 1004 [M/s.Neyvely Lignite Corporation Ltd., v. Special Tahsildar (Land Acquisition), Neyvely and others], the Supreme Court has held as under:-
"11. ....... The beneficiary, i.e. the local authority or company, a co-op society registered under the relevant State law, or statutory authority is a person interested to determine just and proper compensation for the acquired land and is an aggrieved person. The beneficiary has the right to be heard by the Collector or the Court. If the compensation is enhanced it is entitled to canvass its correctness by filing an appeal or defend the award of the Collector. If it is not made a party, it is entitled to seek leave of the Court and file the appeal against the enhanced award and decree of the Civil Court under Section 26 or of the judgment and decree under Section 54 or is entitled to file writ petition under Art.226 and assail its legality or correctness. When the award made under Section 11 of the Collector is vitiated by fraud, collusion or corruption, the beneficiary is entitled to challenge it in the writ petition apart from the settled law that the conduct of the Collector or Civil Judge is amenable to disciplinary enquiry and appropriate action. These are very valuable and salutary rights. Moreover, in the language of Order 1, Rule 10, CPC in the absence of the beneficiary who ultimately is to bear the higher compensation, no complete and effectual determination of binding just and proper compensation to the acquired land would be made. So it is concomitantly a proper party if not a necessary party to the proceedings under Order 1, Rule 10 CPC. The denial of the right to a person interested is in negation of fair and just procedure offending Art.14 of the Constitution."
40. By perusal of the records of Reference Court, it is seen that the State Government Pleader appeared for Land Acquisition Officer also represented the Divisional Engineer, Highways. We do not think that the State Government Pleader can effectively represent the Union of India or National Highways Authorities of India. As held by the Supreme Court, the LAO who was represented by the State Government Pleader do not generally adduce evidence much less proper and relevant evidence to rebut the claim for higher compensation. Even the cross-examination will be formal and ineffective or at time, no evidence at all would be adduced. Observing that Government Agencies remain insensitive even if stakes involved run into several crores of public money, in AIR 1995 SC 1004 [M/s.Neyvely Lignite Corporation Ltd., v. Special Tahsildar (Land Acquisition), Neyvely and others], the Supreme Court held as under:-
"12. The reasons are not far to seek. It is notorious that though the stakes involved are heavy, the Government Pleader or the Instructing Officer do not generally adduce, much less proper and relevant, evidence to rebut the claims for higher compensation. Even the cross-examination will be formal, haulting and ineffective. Generally, if not invariably the Governmental agencies involved in the process take their own time and many a time in collusion, file the appeals after abnormal or inordinate delay. They remain insensitive even if the stakes involved run into several crores of public money. The Courts insist upon proper explanation of every day's delay. In this attitudinal situation it would be difficult to meet strict standards to fill the unbridgeable gaps of the delay in filing the appeals and generally entail with dismissal of the appeals at the threshold without adverting to the merits in the hike in the compensation. On other hand, if the notice is issued to the local authority etc. it/they would participate in the award proceedings under Sections 11 and 18 adduce necessary and relevant evidence and be heard before determining compensation. For instance that without considering the evidence in the proper perspective, the Court determined the compensation.
13. If there is no right of hearing or appeal given to the beneficiary and if the State does not file the appeal or if filed with delay and it was dismissed, is it not the beneficiary who undoubtedly bears the burden of the compensation, would be the affected person? .......... But suffice it to state that when the beneficiary for whose benefit the land is acquired is served with the notice and brought on record at the state of enquiry by the Collector and reference Court under Section 18 or in an appeal under Section 54, it/they would be interested to defend the award under Section 11 or 26 or would file an appeal independently under Section 54 etc. against the enhanced compensation. As a necessary or proper party affected by the determination of higher compensation, the beneficiary must have a right to challenge the correctness of the award made by the Reference Court under Section 18 or in appeal under Section 54 etc. Considered from this perspective we are of the considered view that the appellant-company is an interested person within the meaning of Section 3(b) of the Act and is also a proper party, if not a necessary party under Order 1, Rule 10 of the CPC. The High Court had committed manifest error of law in holding that the appellant is not a person interested." [underlining added]
41. National Highways Authorities of India is a person or authority for whose benefit and for whom the land is being acquired and who may have to pay the compensation ought to have been impleaded as Respondent in the LAOP proceedings. Without being made as a party, National Highways Authorities of India was subjected to serious hardship in being deprived of an opportunity in putting forth its case. In the absence of beneficiary for whose benefit the land was acquired, who is ultimately to bear the higher compensation, there is no complete and effectual determination. Without impleading the beneficiary, there is no effective determination of binding just and proper compensation to the acquired lands could be made. In our considered view, without impleading the National Highways Authorities of India Requisitioning Body/Beneficiary, there is no effectual determination of compensation. Denial of right to a "person interested" is negation of fair and just procedure offending Article 14 of Constitution of India.
42. PETITIONS UNDER OR.41, RULE 27 CPC FILED BY NHAI:- CMP.No.1710 in A.S.No.386/2000 and C.M.P.No.1711/2009 in A.S.No.387/2000:
Stating that they have not been impleaded as party in the LAOP and that they have been deprived of opportunity of putting forth relevant evidence, the National Highways Authorities of India has filed applications to receive the documents as additional evidence. The National Highways Authorities of India has filed various documents which are as follows:-
S.No. Date Description of document 1 29.12.1992 Xerox copy of Representation of Makkal Development Council, Namakkal addressed to the Prime Minister of India. 2
-
Xerox copy of pamphlet 3 27.11.1992 Copy of Letter No.12014/272/92-TN by Government of India, Ministry of Surface Transport (Roads Wing) addressed to the Special Secretary to Government of Tamil Nadu.
409.01.1993 Xerox copy of Letter C.No.45/93/JDO addressed by Divisional Engineer (NH), Salem to the District Collector, Namakkal.
526.08.1997 Xerox copy of Decree in LAOP.No.63/1991 on the file of Sub-Court, Namakkal.
629.04.2003 Xerox copy of Judgment in A.S.No.34 of 2000 on the file of High Court of Judicature, Madras.
7-
Xerox copy of Award No.8/1998.
803.05.1991 Xerox copy of registration copy of sale deed executed by Mahalingam infavour of Aushgar Basha.
912.06.1991 Xerox copy of registration copy of sale deed executed by Mahalingam infavour of Saravanan.
1012.06.1991 Xerox copy of registration copy of sale deed executed by Mahalingam infavour of Saravanan.
43. There had been protests and demonstrations demanding bye-pass road to Namakkal town even from 1991. By perusal of the additional documents filed, it is also seen that on 09.01.1993, administrative sanction was given to the scheme for formation of bye-pass road. Thereafter, Ex.C2 sale deed [19.1.1993] and Ex.C3 sale deed [25.8.1993] came into existence. The evidentiary value of the recitals, particularly the consideration aspect, the documents will have to be examined in the light of the additional documents filed by National Highways Authorities of India and also other documents like other contemporaneous sale deeds executed.
44. It is also seen from the additional documents filed along with the Petitions that for the lands acquired for Master Plan Complex and Neighbourhood scheme, the value of the land was fixed at very lesser rate and in our considered view that the additional documents are very relevant to be marked. We are of the view that National Highways Authorities of India has to be given an opportunity to adduce evidence and to demonstrate its stand in respect of Exs.C3 and C2-sale deeds.
45. In the light of the additional documents filed by the National Highways Authorities of India and having regard to the serious doubts that arise regarding genuineness of Exs.C3 and C2 sale deeds, we are of the view that the impugned order passed by the Reference Court in the LAOP Nos.7 and 8/1996 are to be set aside and the matters are to be remitted back to the Reference Court for consideration of the matter afresh.
46. We are conscious that the lands were acquired about 1= decades ago i.e., in the year 1995 and in the LAOPs, Judgment was pronounced in 1999. We are also conscious that under Or.41, Rule 27 CPC, the first Appellate Court can itself receive the documents produced as additional evidence and thereafter proceed to analyse the matter by receiving the additional documents. From the chart filed by the learned Additional Solicitor General, it comes to be known that as against the estimated cost of acquisition of about Rs.1 crore and odd, by the impugned Judgment, several crores were awarded by enhancement of compensation. Having regard to the higher stakes involved, we are of the view that National Highways Authorities of India has to be given sufficient opportunity to adduce oral and documentary evidence apart from the additional documents filed before us. In such view of the matter, having regard to the higher stakes involved, notwithstanding the passage of time, the matter has to be remitted back to the Reference Court for consideration of the matter afresh by affording sufficient opportunity to the Appellants to adduce oral and documentary evidence. Like wise, the Reference Court shall provide opportunity to the Claimants to let in additional oral and documentary evidence by means of examining the witnesses if they so desire.
47. In the result, the Judgment of the Reference Court/Sub-Court, Namakkal dated 28.04.1999 made in LAOP.Nos.7 and 8/1996 is set aside and these Appeals are allowed and the matters are ordered to be remitted back to the Reference Court for fresh disposal.
Reference Court is directed to implead the Project Director and General Manager, National Highways Authorities of India, Ministry of Shipping, Road Transport and Highways, No.10, Kamadhenu Nagar, Karur-639 001 as Respondent in LAOP.Nos.7 and 8/1996. Reference Court is directed to receive the documents filed by National Highways Authorities of India filed in these Appeals as well as other documents to be filed by National Highways Authorities of India. Reference Court is further directed to afford sufficient opportunity to National Highways Authorities of India and also to Appellants to adduce oral and documentary evidence. The Reference Court is directed to receive the additional documents filed by NHAI and other documents to be filed by NHAI and afford opportunity to adduce oral evidence. The Reference Court shall also afford opportunity to the Land Acquisition Officer and to the Respondents/Claimants who are already on record to adduce oral and documentary evidence if they so desire and consider the matter afresh and pass appropriate orders preferably within a period of six months from the date of receipt of copy of this Judgment.
As per the order in CMP Nos.16759 & 16760/2000 dated 14.11.2000, 25% of enhanced compensation was deposited to the credit of LAOP Nos.7 and 8/1996. The compensation amount so deposited shall continue to remain in the fixed deposit on reinvestment plan.
Cross Objection Nos.94/2002 and 54/2003:- In view of the conclusions in the Appeals, the Cross Objections filed by the Claimants are dismissed.
All the parties are directed to appear before the Reference Court on 19.04.2010.
In view of the remand of the matter and permitting the parties to adduce additional evidence, all CMPs including Petitions filed for reception of additional documents are closed.
In the circumstances of the case, there is no order as to costs in these Appeals.
Learned Special Government Pleader (AS) shall be entitled to legal fee as per Rule 12 of Legal Practitioners Fee Rules.
[R.B.I.,J] [M.V.,J] 06.04.2010 bbr Index: Yes/No Internet: Yes/No Note:-
(i) Office is directed to send copy of this Judgment and records to the Reference court Sub-Court, Namakkal forthwith.
(ii) Office is directed to return the additional documents filed by National Highways Authorities of India in CMP Nos.1710 and 1711 of 2009 to enable them to file before the Reference Court.
(iii) Issue order copy on : 12.04.2010.
To The Subordinate Judge, Namakkal.
The Registrar-Judicial to report compliance.
R.BANUMATHI, J.
and M.VENUGOPAL, J.
bbr
Common Judgment in
A.S.Nos.386 & 387 of 2000
and
Cross Obj.Nos.94/2002 &
54/2003
06.04.2010