Gujarat High Court
Sharadchandra Chimanlal And Ors. vs State Of Gujarat And Ors. on 14 March, 1986
Equivalent citations: AIR1987GUJ55, (1986)2GLR1369, AIR 1987 GUJARAT 55
JUDGMENT B.K. Mehta, J.
1. A few facts need be noticed in order to appreciate the claim made in this appeal.
2. By notification issued by the State Government in the Revenue Department dt. Jan. 10, 1974 under S. 4 of the Land Acquisition Act the intention to acquire the property bearing city survey No. 3/3222 comprising the land bearing S. No. 126 and the building standing thereon situate within the town limits of Khambhat was declared for public purpose of Vegetable Market Yard. It should be recalled that the land in question is of the ownership of one religious public trust, namely, Galivara Panch and Kalka Mataji Temple Trust, Khambhat and permanent lease hold rights were granted in respect thereof to one Kavidas Parshottaindas who died during the pendency of these proceedings by registered lease deed of Mar. 31, 1924.The building consists of a bungalow and 9 rooms attached thereto which were constructed by the lessee, The State Government published a notification under S. 6 acquiring the said property on May 1, 1975. General notices under S. 9(1) and (2) of the said Act had been published on July 24, 1975. The individual notices as required under S. 9(3) and (4) have been served upon the concerned persons. In pursuance of notices under S. 9, the land owner preferred claim for compensation for the land at the rate of Rs. 35/- per sq. yard and prayed that the amount of compensation as determined may be apportioned in the proportion of 75 : 25 between the Trust (hereinafter referred to as the "landowner") and said Shri Kavidas Parshottamdas (hereinafter referred to as the "lessee"). They declared before the land Acquisition Officer that they had no concern with the construction of the superstructure and consequently for the compensation thereof. As far as the lessee was concerned, it appears from the award of the land Acquisition Officer that the lessee has not submitted any claim for compensation in respect of the land and/or structure. The I-and Acquisition Officer determined the price of the land which was admeasuring Are 26-30 sq. meters which is equivalent to 2630 sq. meters at Rs. 13150/- and granted additional compensation at the statutory rate of 15% of the market price amounting to Rs. 1972-50 which aggregated to Rs. 15122-50. Out of the aggregate amount of compensation as above, the Land Acquisition Officer apportioned the same between the land owner and the lessee in proportion of 60 :40. As regards the superstructure, the Land Acquisition Officer assessed the value of the construction as shown at "P" in the map prepared by the Deputy Engineer at Rs. 371 after deducting the amount of depreciation of Rs. 16 160 from the value of the construction of Rs. 16731, lie apportioned this amount between the land owner and the lessee in the same proportion and awarded Rs. 222-60 to the landlord and Rs. 148.40 to the lessee. He awarded additional compensation at the statutory rate of 15% on both these amount to the and owner and the lessee.
3. As regards the valuation of the structure shown at "Q" in the aforesaid map, the land Acquisition Officer assessed it at Rs. 652.00 after deducting the depreciation of Rs. 28342.00 from the value of the structure at Rs. 28994.00. Since this was constructed by the lessee, the entire amount of Rs-652/-together with additional compensation at the statutory rate of 15% thus aggregating to Rs. 749.30 to the lessee.
4. It appears that both, the land ownor and the lessee being dissatisfied with the offer made by the Land Acquisition Officer vide his award of J Line 30,1976, as aforesaid sought reference under S. 18 of the Land Acquisition Act which was granted and they were numbered as Land Acquisition Case No. 39 of 19716 by the land owner and Land Acquisition Case No. 40 of 1970 by the lessee. It should be noted that so far a the lessee was concerned though he had not preferred any claim of compensation before the Land Acquisition Officer, he claimed compensation for the land at the rate of Rs. 45/- per sq. yard and accordingly claimed compensation for th6 land in sum of R.s. 1,32,030.00 and claimed Rs. 50,000/- as compensation for building. lie also claimed solatium for acquisition at the statutory rate in sum of Rs. 20,000/-. In all he claimed Rs. 2,02,030 and after deducting the amount of compensation of Rs. 7054/- as awarded by the Land Acquisition Officer, he claimed additional compensation of Rs. 1,94,976/-. On the other hand, the land owner claimed compensation for the land at the rate of Rs. 381- per sq. meter amounting to Rs. 92,221 /- and after deducting the amount of compensation of Rs. 9073.50 as awarded by the Land Acquisition Officer, they claimed additional compensation of Rs. 83, 147.50 and on the basis of the proportion adopted by the Land Acquisition Officer, namely, 60 : 40 between the land owner and the lessee, they claimed that they should be awarded additional compensation of Rs. 50,000/-.
5, Both these. compensation casts were consolidated for purposes of hearing by the learned Extra Assistant Judge, Nadiad before whom these matters reached for hearing. It should be noted that both the claimants led their oral evidence but as far as the documentary evidence was concerned. they produced and relied on the common evidence. The Land Acquisition Officer bas also led evidence and produced some documentary evidence of sale instances in support of the offer made. by him. So far as the claimants were concerned, they relied on the award made by the Court of learned Extra Assistant judge in Land Acquisition References Nos. 46, 47,48, of 1971 produced 25and also on the award made by the learned Extra, Assistant Judge in Land Acquisition Reference No.25 of 1974 produced at Ex. 63. Besides these two awards, the, claimants placed reliance on sale instances evidenced by the sale deed dt. July 29,1971 produced at Ex. 43 and agreement of sale produced at Ex. 38/1 before the Court. The acquiring Body on the other hand produced and relied on two sale instances evidenced by sale deeds of July 30, 1975 and sale deed of Dec. 15, 1975 produced at Fxs. 90and 91. The learned Judge rejected the evidence produced and relied upon by the acquirer's body since they were post notification sales and were not comparable in point of time with the relevant date of the acquisition since the relevant date of the notification under Section 4 for the acquisition in question was Nov. 21, 1983 white the sale deed on which reliance was placed by the acquiring body was of July and Dec., 1975. The learned Assistant Judge also could not persuade himself to consider the sale instance evidenced by sale deed dt. July 29, 1971 produced at Ex. 43 at the instance of the claimants since it was also not comparable in point of time since a long period elapsed between the date of the said sale deed and the date of 4 notification for the present acquisition. As regards the award of the learned Assistant Judge, Nadiad produced at Ex. 25 by the claimants and which was rendered in land acquisition Cases Nos. 46, 47 and 48 of 1971 and which was heavily relied upon by the claimants, it did not impress the learned Assistant Judge because according to him since they were merely awards they could not be considered better than offers and, therefore, that evidence is not worthy of acceptance and, therefore, could not assist the case of the claimants. As regards another award rendered in Land Acquisition Reference No. 25/74 of the same Court produced at Ex. 63, the learned Assistant Judge surprisingly failed to refer to this important evidence since it was so nearer in point of time and therefore we have no benefit of his view in that behalf. The learned Assistant Judge in the circumstances, therefore, thought fit to assess the market value of the laud by capitalising it. He found that the amount of compensation offered by the Land Acquisition Officer on the method of capitalisation of annual value would give 25 years purchase, but in his opinion, the capitalisation should have been made by working out on 20 years purchase basis which would.give less than what has been offered by the Land Acquisition Officer and, therefore, he did not think fit to grant any additional compensation on account of the land. However, as regards the structure, the learned Assistant Judge was not impressed by the evidence of the claimants nor by the evidence of the Deputy Engineer of the State Government who was cited as a witness of the acquiring body, but having regard to the admission made by the Chairman of the Market Committee, Khambhat for which this acquisition was made that the market value of the structure would be about Rs. 12,000/-, decided to enhance the, compensation of Rs. 120 as offered by the Land Acquisition Officer to Rs. 12000/- as admitted by the Chairman of the Acquiring body. lie accordingly awarded additional compensation and apportioned the same in the proportion of 60 : 40 between the land owner and the lessee. He granted solatium at the statutory rate. then prevailing at 15% of the market price of the building on the amounts respectively coming to the share of the land owner and the lessee. He awarded interest at the rate of 41/2% per annum from the date of taking over possession that is 30th June 1976 till payment of this enhanced compensation. lie made an award accordingly by his order of Mar. 31, 1978. It is this award of the learned Assistant Judge which has been challenged in this appeal at the instance of the lessee.
6. The landowners have filed their cross objections.
7. Mr. S. R. Shah, learned Advocate, appearing for the appellant-claimants urged two contentions in support of this appeal. In the first place he submitted that the learned Assistant Judge was clearly in error on the matter of principal in refusing to consider the evidence of a comparable sale instance evidenced by the award made particularly in Land Acquisition Reference No. 46/71 which was in connection with the acquisition of and for tire very market yard by notification ,under S. 4 of the Land Acquisition Act dt. 9th Jan. 1969 where the same Court of the learned Extra Assistant Judge, Nadiad has fixed the market price of the land in question which was admeasuring about Are 23-21 sq. meters equivalent to 2321 sq. meters at Rs. 38/- per square meter. In submission of Mr. Shah this instance is comparable in the point of time with the .and under acquisition inasmuch as the purpose of the acquisition of the said piece of land was this very Vegetable Market Yard to be set up in Khambhat and having regard to the situation of the land which is Just in the vicinity of the land under acquisition. Secondly, he made a grievance that the learned Judge completely lost sight of another award made by that very Court in Land Acquisition Reference No. 25/74 in respect of a piece of land admeasuring 13-15 sq. meters of S.No. III which was also acquired for the very market yard under S. 4 notification dt. June 28. 1973 which was belonging to the lessee before us where the Court has fixed the market price of the said land at Rs. 15/-per sq. yard. Mr. Shah urged that the learned Judge was in error on matter of principle in apportioning the compensation in the way in which he did. In submission of Mr. Shah, the learned Judge was required to apply correct principle in the matter of apportionment applicable in cases between landlord and permanent tenant where the landlord has merely right to receive a rent and the right of the reversion of the leas& hold rights at the end of the stipulated period and there cannot be any fixed strait-jacket formula for apportioning the amount of compensation. In any case, Mr. Shah urged that the teamed Judge was in error on matter of authority since this Court has held that the rough method of apportioning compensation in cases of permanent lease hold rights is to divide the compensation in the proportions of 75 : 25 between the permanent tenant and the landlord as held in Bai Saraswati v. Bharatkhand Textile Mfg. Co., AIR 1967 Guj 36. Mr. Shah also claimed that the appellant claimants are, entitled to the benefit of the amended provisions of S. 23(2) and 28 of the Land Acquisition Act, 1984.
8. On behalf of the respondents, it was claimed that the appellant-claimants are not entitled to any compensation in excess of the offer made by the Land Acquisition Officer inasmuch as the appellant-claimants have not preferred any claim whatsoever after notice to them under S. 9(3) and (4) as prescribed by S. 25 of the Land Acquisition Act before its amendment in 1984 where the Court was not entitled to grant any additional compensation in excess of the compensation claimed before die Land Acquisition Officer and, therefore, the , present appeal is incompetent on that ground.
9. We may first of all dispose of the preliminary contention raised by the learned Assistant Government Pleader about the competency of the appeal by the appellant claimants. It is no doubt true that under S . 25, as it stood before its amendment by S. 17 of the Amending Act (No. 68 of 1984), where the applicant has made a claim to the compensation pursuant to any notice given under S. 9, the amount awarded to him by the Court shall not exceed the amount so claimed or be less than the amount awarded by the Collector under S. 11. The legal position before the amendment of S. 25 was that not only the person interested on receiving a notice under S. 9 was to lay a claim but he was under an obligation to claim a specific amount and consequently' therefore, the award of the Court could not exceed the sum so claimed (See : Goverdhan Mahto v. State of Bihar, (1979) 4 SCC 330 : (AIR 1979 SC 1246)). In other words, if no claim has been preferred by a person interested in the land acquired, the Court would be precluded from awarding any compensation higher than that offered by the Land Acquisition Officer. It is -with a view to remove the mischief contained in this provision that S. 17 of Act No. 68 of 1984 deleted S. 25 as it then stood and substituted the following section in its place :
"25. The amount of compensation awarded by the Court shall not be less than the amount, awarded by the Collector under S. 11".
10. Section 25 as it stands now obviates the necessity of any claim being led in response to the notice under S. 9 of the Act, because the only limitation on the power of the Court which has now been prescribed under the amended S. 25 is that the amount of compensation awarded by the Court shall not be less than the amount offered. In other words, the Court cannot in a reference application reduce the amount of compensation as offered by the Land Acquisition Officer. The resultant position emerging from the amended section is that even without any such claim the Court can award compensation in excess of what has been awarded by the Collector, which position was not available prior to 1984 since there was a limitation also on the power of the Court in the preamended section that the Court would not award compensation beyond that claimed by a person interested. In other words, the position prior to 1984 was that failure to make a claim despite receiving notice under S. 9 without sufficient cause precluded the Court from awarding a sum in excess of the Collector's award. The learned Assistant Government Pleader, therefore, urged that this benefit of the amended section would not be available to the present appellants since at the time when the award was made by the Court, that is, on Mar. 31, 1978, the amended provision was not on the statute book and since this provision is not retrospective, the benefit of the amended provision cannot be pressed into service by the appellant-claimants in appeal before us which is an appeal from the award of the Court. We do see some force in this contention but we find that no objection has been raised on behalf of the Land Acquisition Officer as well as the acquiring body to the jurisdiction on the Court in reference under S. 18 of the Act on the ground that no claim was laid by the appellant-claimants in response to the notice served on them under S. 9 and, therefore, this plea cannot be raised for the first time in, this appeal (See : Punjab State v. Lachhman Dass, AIR 1964 Punj 68 and Land Acquisition Collector v. Parvati Devi, AIR 14 Him Pra 32). It should be further noted that since this plea was not raised in the 'written statement, no appropriate issue has been raised consequently, since this would be a question of fact as to whether the Government has been able to dischar8c the burden of proof of establishing that a given claimant has not laid a claim in response to S. 9 notice which plea requires to be investigated, inter alia. Into the question as to whether notice under S. 9(3) and (4) has been property served on the claimant or not. In that state of the pleadings, we do not think that this plea can be now available and pressed into service on behalf of the respondents.
11. That takes us to the question of adequacy of the compensation awarded by the learned Assistant Judge, the apportionment thereof and the benefit of the amended Ss. 23 and 28 of the Land Ac4qu:sition Act. Before we take up this question, we must note one fact that the appellant-claimants have in this appeal restricted their claim to the additional compensation of Rs. 36,000/- and paid court fees accordingly. It is in this context of the restricted claim that we shall be required to consider as to whether additional compensation is justified and, if so, to what extent.
Re : Adequacy of compensation of land & building :
12. The learned Advocate for the appellant-claimants has in support of the additional claim of compensation heavily relied upon the two documents, namely, award in Land Acquisition References Nos. 46,,47 and 48 of 1971 on the file of the Assistant Judge, Nadiad and produced at Ex. 25 and another award in Land Acquisition Case No. 251/74 on the file of the Assistant Judge, Nadiad and produced at Ex. 63. Now, so far as the instance at Ex. 25 is concerned, the learned Assistant Judge could not persuade himself to accept this evidence as a comparable one since in his opinion this award was no better than an offer made by the Land Acquisition Officer. We will, therefore, set out what the learned Assistant Judge has observed in this behalf while refusing to accept the evidence at Ex. 25 relied upon by the appellant-claimants on Ex. 25.
"However in this case the claimants have relied on instance of compensation and therefore the question of prominence or potential of the acquired land is only academic. On behalf of the claimants reliance is placed on judgment Ex. 25. This is a judgment of this Court awarding compensation in Compensation Cases. Nos. 46, 47 and 48 of 1971. It is in evidence of the applicant Panachand Ex. 24 that it is in respect of the acquisition of the lands of vegetable market which is near the acquired property and by this judgment the compensation awarded was Rs. 31/- per square meter. However, there is nothing on the record to show whether the award by this judgment was accepted by both the parties or whether any appeal is preferred against the same. An award is a mere offer and unless it is accepted by both the parties, it cannot be relied on for the determination of the compensation of the acquired property in the present case. 1, therefore, do not propose to rely on the judgment Ex. 25."
13. We agree with the learned Advocate for the appellant-claimants that the learned Assistant Judge was clearly in error on matter of principle as well as authority is discarding this important evidence in the nature of an award made by the Civil Court in a reference under S. 18 of the Land Acquisition Act 'as of no consequence since it is no better than an offer made by the Land Acquisition Officer. In fixing compensation for land acquired, the market price fixed in respect of contiguous land which is also acquired can be taken into consideration and compensation is to be fixed in light thereof after comparing the relative situation and importance of the two plots (See - Daisy v. State of Kerala, AIR 1971 SC 2272). It does not require much of logic to support this principle since one of the principles which govern the question of assessment of market value is that the value of the land in general can be measured by consideration of prices that it is obtained in the past for land of similar quality and in similar position (See : Collector of Jabalpur v. Babulal, (1977) 4 SCC 471) (State of Karnataka v. Ranganath Reddy ?). This Court has also in Udayan Girja Prasad v. Special Land Acquisition Officer, Ahmedabad, (1976) 17 Guj LR 668 has ruled that the market I price is that price which a normal and prudent buyer would pay after evaluating the prices prevailing in the round about area and which a normal and prudent seller is willing to accept. The actual transaction with respect 'to a specific land of recent date is a safe guide which the Courts should not disregard when called upon to fix the amount of compensation. The best evidence is that of ,sale of a land similar in quality and the characteristic which is proximate in point of time to the date of notification under S. 4. (See : Dollar & Co., Madras v. Collector of Madras, AIR 1975 SC 1670). If the Court has to assess the market price on the basis of the sale instances of land proximate in point of ,:time to the date of S. 4 notification for ,acquisition and of similar nature in quality and its peculiarities, we have not been able to appreciate as to how the learned Assistant Judge thought fit to disregard the evidence of most comparable instances where the-market price was fixed under the awards of the learned Judge in reference under S. 18 of the Land Acquisition Act. The learned Judge was, therefore, clearly in error in rejecting in a cryptic manner one of the best pieces of evidence which was available on the record and thereby falling back on another method of assessing the fair market price, namely, capitalising it on a number of years purchase. If we look to Ex. 25, we find that the very Court of the Assistant Judge of Nadiad has in respect of a piece of land measuring about ' 23-21 sq. meters equivalent to 2321 sq. meters awarded compensation of Rs. 35/- per sq. meter in Land Acquisition Case No. 46/71. It should be recalled that the acquisition was for the very purpose of vegetable market yard with which we are concerned. The relevant notification under which the intention for acquisition in respect of the said land was declared was of Jan. 9, 1969. It is no doubt true that the land under acquisition which is admeasuring about Are 26-30 sq. meters is situated on the back of the land with which the Court was concerned in Land Acquisition Reference No. 46/71. It is also true that the land under acquisition is slightly at a higher, level than that piece of land with which that Court was concerned in the said reference case. None-the-less these two de-similarities. namely, being on the back of the marketing yard and at a higher level than the road level is off-set by the increase in the prices during the period between the date of S. 4 notification declaring the intention of acquiring the land involved in that reference and the date of S. 4. notification in respect of the present acquisition. The land which was subject matter of reference in Case No. 46/71 was sought to be acquired by notification under S. 4 dt. 9th Jan. 1969 while the date of S. 4 notification in the present case~ before us is 21st Nov. 1973. Thus, there is a difference of about five years between these two acquisitions. We can take. a judicial notice of the fact that the prices have gone up appreciably during this period of five years intervening between the said two acquisition. Of course, we have no evidence as to by what precise percentage the market have gone up but want of evidence on that count would not be an impediment in our way here because the appellant-claimants are claiming additional compensation at the rate of Rs. 38 per sq. meter in the present appeal before us. We are, therefore. of the opinion that the learned Assistant Judge was clearly in error in refusing to consider the evidence furnished by the award made by the Civil Court in reference under S. 18 of the Land Acquisition Act, namely, Ex. 25 and refusing to fix the market price accordingly. We are of the opinion that we can safely assess the market price of the land under acquisition before us on the basis of the important evidence furnished by Ex. 25 where the very Court of the Assistant Judge Nadiad had fixed compensation in respect of the land notified to be acquired under S. 4 notification of 9th Jan. 1969 at the rate of Rs. 38 per sq. meter. We are, therefore, of the opinion that the market price of the land under acquisition would be Rs. 38/- per sq. meter.
14. In that view of the matter we need not go into the question as to how far another award rendered by the very Court in Land Acquisition Case No. 25/74 in respect of a piece of land of S.No. 10 11 acquired for this very market yard and produced at Ex. 63 is of any assistance to the case of the appellants. It is no doubt true that the market price fixed under the said award Was in respect of a land intended to be acquired by S. 4 notification of June 28,1973and the market price assessed by the learned Assistant Judge, Nadiad was Rs. 15/- per sq. meter. It is no doubt true that the relevant date of S. 4 notification is proximate in point of time to the date of notification under S. 4 with which we are concerned in the present appeal. But the important point which must be emphasised is that the kind with which the learned Assistant Judge was concerned in the said reference No. 25/74 was agricultural land while the land with which we are concerned is a nonagricultural land bearing city survey number. We, therefore, do not think that the award at Ex. 63 can be pressed into service justifiably for purposes of urging that the market price which should be fixed must be on the basis of the price as determined under Ex. 63. In that view of the matter, therefore, we fix the market price of the land under acquisition at Rs. 38/- per sq. meter and on that basis the amount of compensation would be to the tune of Rs. 99940/-.
15. This will take us to the consideration as to what should be the compensation of the superstructure. In Udayan Girijaprasad case (1976-17 Guj LR 668) (supra) the Division Bench of this Court consisting of J. B. Mehta and T. U. Mehta, JJ. (as they then were) in a situation where a composite property was to b~! evaluated, ruled that the property in question should ordinarily be valued as whole composite unit and aggregate of valuations of its different components such as land and structure would normally not give an idea of its market value. We are required ordinarily, on matter of principle, to evaluate the composite property with which we are concerned as a whole. But in our opinion that exercise would be academic for the obvious and simple reason that in that case the price of the composite property would ordinarily be more than the price of the land and having regard to the fact that the appellant-claimants have restricted their claim to Rs. 36,000/-, we need not undertake that elaborate exercise. We, therefore, proceed on the basis that the market price of the composite property is that equivalent to the market price of the land for purposes of this appeal having regard to the fact that there is a restricted claim. The question which would, therefore, immediately arise would be that what should be the appropriate percentage in the matter of apportionment of this compensation. The learned Assistant Judge has proceeded on the basis as if there is a strait-jacket formula for apportionment of the compensation. Sections 23 and 24 of the Land Acquisition Act lay down the principle of compensation and there is no provision in the Act or in the Rules indicating the principles of apportionment. We have, therefore, to fall back on the principles as enunciated by the Court in that behalf.
16. In Re Pestanji Jahangir Hormasji, (1912) 14 Bom LR 507, the Bombay High Court ruled that what the Collector and the Courts have to do is to apportion the sum awarded amongst the persons interested in proportion to the value of their interest and that it was not possible to lay down any general rule which can be followed. The market value of any interest, if ascertained, may afford some guidance towards ascertaining the amount to be apportioned in respect of that interest. But that can only be considered in relation to the total sum awarded as compensation. We must bear in mind the factual context in which we have been called upon to apportion the amount of compensation. The factual context is that the apportionment is to be made in respect of, a large piece of plot of land given on a long term lease of about 999 years to the lessee. In other words, the lessee is a permanent tenant. In the matter of apportionment between landlord and a permanent tenant it is settled principle that the- landlord should get the capitalised value of the land plus something more on account of the right of reversion vested in him and the balance must go to the permanent tenant in whom the rest of the rights in the land is vested. There is, however, no fixed basis on winch the right of possible reversion can be valued in terms of money (Vide : Thakur Govinddasji Maharaj v. Thakur Raniji Maharaj, ILR (1962) 2 All 453). In Bharatkhand Textile's case, (AIR 1967Guj 36) (supra), the Division Bench of this Court consisting of Miabhoy and M.U. Shah, JJ. as they then were) was concerned with the question of apportionment between the landlord and permanent lessee where the District Judge held that the landlords were entitled to 1/4th of the amount of compensation while lessee was entitled to balance of Y'4th of the compensation. The Division Bench in that factual context ruled that in determine the question of apportionment between a landlord and a tenant, the task which has got to be performed by the Court is to conitvnsate the landlord and the tenant for the value of the interest that is lost by the acquisition, and there is no question of any windfall in determination of the amount of compensation at all; the amount of compensation is determined with reference to the market value of the land as prevailing on the date of the notification and the question is what is the portion of that market value which is attributable to one or the other party and which that party has lost. If the interest of the landlord and tenant cart be valued in tenns of money with a reasonable precision and exactness that would be the best method of computing the compensation. It in a given case the totality of the amount of compensation does not coincide with the totality of the two interests separately valued, then, the question would further arise for determination as to how the excess or the shortfall is to be apportioned between the two interests. Some judges have resolved this problem by dividing the excess or the shortfall in the proportion of the values separately determined in respect of each interest. But whichever of the aforesaid two methods is employed the condition precedent for the employment of such a method is that the Court must be in a position to value in more or less a precise and exact manner each interest. The Division Bench, on consideration of the facts and circumstances of the case before it, held that since it was not possible to evaluate the interest of the landlord and tenant with reasonable precision in terms of money the first two methods referred to above could not be adopted and, therefore, the third method of evaluating the interest of the claimants in terms of fraction of the total amount of compensation regarded as a single unit has to be adopted and, therefore, the, proportion fixed by the learned District Judge at 25 and 75 per cent could not be stated to be unreasonable.
17. In Dossibai Nanabhoy Jeejeebhoy v. P. M. Wharucha, (1958) 60 Born LR 1208, the Division Bench of the Bombay High Court in the matter of apportionment of the amount of compensation between lessor and lessee held as under :
"In apportioning the compensation, the Court has to give to each claimant the value of the interest which he has lost by compulsory acquisition. So stated, the proposition may appear simple; but in it, practical application numerous complicated problems arise in apportioning the compensation awarded. The difficult, experienced is due to the nature of a variety of interests, rights and claims to land which have to be valued in terms of money. The compensation awarded for compulsory acquisition is the value. of all the interest which are extinguished and that compensation has to be distributed equitably amongst persons having interest therein and the Court must proceed to apportion the compensation so that the aggregate value of all interests is equal to the amount of compensation awarded. In disputes between landlords and tenants about apportionment, different methods of apportionment have been adopted. The methods which are generally adopted fall into three broad divisions. Under the first method the value of the lessor's and the lessee's interest may be separately ascertained in terms of money and then out of the total amount awarded the value of the interest of one may be taken out and the remainder awarded to the other. The second method is to value the interest of the lessor and the lessee separately, and if the aggregate of these two values does not reasonably correspond to the amount of compensation available for distribution, the amount may be distributed in the proportion of the two amounts. If reasonably precise valuation of the competing interests is not possible the Court may proceed to evaluate the interests of the claimants in terms of fractions of the total amount of compensation regarded as a single unit, That is the third method. Theoretically the aggregate value of the interests acquired must be equal to the amount of compensation to be distributed. But in the valuation of competing infer6sts,, which from its very nature is dependant to poll indefinite factors and uncertain data considerable difficulty is encountered Indisputably in apportioning compensation the Court cannot proceed upon hypothetical considerations but must proceed as far as possible to make an accurate determination of the value of the respective interests which are lost. The Court must, in each case, having regard to the circumstances and the possibility of a precise determination of the value having regard to the materials available, adopt that method of valuation which equitably distributes the compensation between the persons entitled thereto."
18. The Division Bench following the Full Bench decision of Allahabad High Court in Shiamlal v. Collector of Agra, (1933) ILR 55 All-897: (AIR 1934 All 239) adopted the third method to evaluate the interest of the claimants in terms of fraction of the total amount of compensation regarded as single unit and held that having regard to the fact that the land in question was agricultural land given on a long lease of 99 years with the option to the tenant to renew it for another 99 years at enhanced rate, the apportionment of the compensation should be in proportion of 6 Anna and 10 Anna between the landlord and the tenant.
19. In Kachrulal Hiralal Dhoot v. Gurudwara Board, Nanded, AIR 1979-Bom 31, the High Court of Bombay held that the licence given in that case in respect of the land acquired was irrevocable and permanent, as provided in S. 60 of the Easements Act and, therefore, in the same position as that of a permanent tenant who remains in possession indefinitely with an obligation to pay the rent reserved either monthly, annually or periodically as the case may be and the right of the owners was only to receive every year a certain sum by way of rent and, therefore, the owners were entitled to claim compensation arrived at upon capitalisation of twenty years income.
In view of the above settled legal position so far as this Court is concerned, we agree with the learned Advocate for the appellants that the learned Assistant Judge was in error in apportioning the compensation in proportion of 60 : 40 between the lessee and the landowner before us. Assuming that the learned Judge was compelled to adopt the third method in apportioning the compensation in fraction of the respective interest, even then he was not justified in Pdopting 60 : 40 as the basis since this was not an agricultural land in the first instance, and secondly because the rent was fixed and the only right which the landowner has in this land is right to receive rent and the right of reversion. In that view of the matter, the learned Extra Assistant Judge ought to have adopted rough formula which has found favour with the Division. Bench in Bharatkhand Textile's case, (AIR 1967 Guj 36) (supra), particularly because the ground rent was fixed and the capitalised value thereof as done by the Bombay High Court in Kachrulal's case (supra) would not adequately compensate the landlord who has not only right to receive the rent but right to reversion also; may be that the latter right may not be of much significance, The learned Judge ought to have, therefore, apportioned the compensation in proportion of 25 : 75 between the landowner and the lessee, respectively. If that had been done by the learned Judge, the lessee would have got about Rs. 74955/- approximately while the landowner would have got Rs. 24985/-. The learned Judge has found that the lessee was entitled to total compensation including that awarded by the Land Acquisition Officer to the tune of Rs. 10,060/- and the landowner was entitled to Rs. 15,091/-. We are, therefore, of the opinion that even if we agree with the learned Advocate for the appellants that the learned Assistant Judge was in error in the matter of apportionment of compensation, and that he ought to have at least followed the rough and ready method of evaluating the respective interests as held by this Court in Bharatkhand Textile'scase (supra), even then having regard to the fact that the appellants have restricted their claim for the additional compensation in this appeal to the extent of Rs. 36000/-, the total compensation including that which has been already awarded by the Land Acquisition Officer and Civil Court and the additional compensation which we are inclined to grant in the present appeal would fall far short of the amount of ,compensation which the appellant-claimants are entitled to on apportionment of the compensation as indicated above, that is, Rs. 74955/-. It should be again recalled that the learned Assistant Judge has made apportionment of the total compensation as awarded by the Land Acquisition Officer and by the Court in the proportion of 60 : 40 between the landowner and the lessee which, in our opinion, is clearly wrong for obvious reason that apart from the decision of this Court even adopting 20 years purchase for capitalising the value of the interest. it would come to about Rs. 12,000/- since the fixed ground rent was Rs. 600/- per annum and even adding something on account of the reversion interest which is of no consequence in the present case, we do not think that the compensation to which the land owner would have been entitled on that basis would exceed the compensation which they now get under the apportionment made hereinabove where their share works out to Rs.24985/-.
20. That takes us to the question as to what would be the net result of the benefit of the amended provisions contained in Ss. 23(2) and 28 of the Land Acquisition Act.It is not capable of any debate that in the present case the claimants are entitled to the benefit of the amended provision under S. 30(2) of the Amending Act of 1984, since the proceedings were pending before this Court in April 1982.
21. The next question which then arises is as to how the provisions contained in the amended provisions of S. 23(2) are to, be applied. On plain reading of the gaid amended provisions, we are of the opinion that the enhanced rate for working out the compensation to be paid in consideration of the acquisition is 30% of the market price. There was some debate before us as to whether this 30% is for the additional claim made in appeal or 30% of the market price. market price We do not think that the matter is capable of any serious debate having regard to the provision contained in S. 23(2) -which even before the amendment entitled a claimant to receive additional compensation which we call solatium at the rate of 15% of the market price, and therefore even under the amended provision the additional compensation at the rate of 30% is of the (See : Ranchhodbhai Madhabhai v. Special Land Acquisition Officer, Ahmedabad, 1985 Guj LH 960). It is no doubt true that so far as the higher rate of interest which is permissible under the amended provision is on the difference claimed in the appeal. We must add here that the benefit of this amended provision is not of much advantage to the appellant claimants since in the ultimate analysis the exercise of ascertaining the amount of additional compensation under S. 23(2) at the higher rate of 30% also does not take the case of the appellants any further since they have restricted their claim to Rs. 36,000/- 1 in the appeal.
22. In the circumstances, therefore, we hold that the fair market price of the land under acquisition would be Rs. 39/- per sq. meter and on that basis the total compensation for the land would be Rs. 99940/-. With the consent of the parties, we have taken this amount as the price of the composite property for the obvious reason that there is a restricted claim in this appeal and we have not undertaken the exercise to find out as to what would be the price of the structure or what would be the price of the composite property as a whole. We are of the opinion that the apportionment should have on the facts and in the circumstances of the case, in proportion of 75 : 25 between the lessee and the landowners and accordingly the lessee would be entitled to Rs. 74955/ and the landowners would be entitled to Rs. 24985/-. We have not thought fit to undertake the exercise of what additional compensation the claimants would be entitled to under the amended provisions for the obvious reason of the restricted claim in the appeal. We therefore hold that the appellant claimants are entitled to additional compensation of Rs. 36000/- and interest at the enhanced rate of 9% and 15% as the case may be from the date of taking over possession till payment.
23. As regards the cross-objections, we are of the opinion that they are of no merits since the landowners are not entitled to claim apportionment at 60: 40 basis between the landlord and the lessee on the facts and in the circumstances of the case and as held by this Court in Bharatkband Textile's case (AIR M7 Guj 36) (supra) the cross-objections have no merit even if we adopt the method of capitalising by 20 years' purchase method since in that case also the landowners would not be entitled to Rs. 15,091/- which is a total amount awarded by the Land Acquisition Officer and the Court. Mr. J. B. Patel learned Advocate appearing for the landowners urged that in his cross-objections he has claimed apportionment from the enhanced compensation also and, therefore, he is 'entitled to compensation which is worked out by this Court on the basis of 75 : 25 between the lessee and the landlord. Though the submission appears to be attractive, it would not stand the scrutiny for the simple reason that the proceedings for compensation and proceedings for apportionment are two distinct proceedings under the Land Acquisition Act and a party aggrieved by the award of the Court in a reference under S. 18 in the matter of compensation has to prefer an appeal or cross-objections for that purpose and pay Court-fees accordingly. The landowners in the present case have not done so and, therefore, they cannot claim the benefit of enhanced compensation which we have awarded in the present appeal. However, we are of the opinion that the land owners would be entitled to the benefit of amended provisions under S. 23(2) since the appeal and the present cross-objections therein were pending at the relevant date, that is, 30th April 1982 and, therefore, the additional compensation in consideration of acquisition at the rate of 30% and the enhanced rate of interest on such difference can successfully be claimed by the landowners. We, therefore, hold that the land owners would be entitled to additional compensation at the rate of 30% of. the market price of the property as awarded by the Court viz. Rs. 15,091/- and the net additional amount of compensation would be worked out accordingly after adjusting the proportionate amount of solatium at the rate of 15% as awarded by the Court. They would be also entitled to interest at the enhanced rate of 9% and 15% as the case rnay be on the difference between the amount awarded by the Land Acquisition Officer and the amount awarded by the Court. To that extent the cross-objections are allowed.
24. The result is that the appeal is wholly allowed and the cross-objections are partly allowed to the extent indicated above. The appellants shall be entitled to the costs while the respondents shall be entitled to the costs to the extent to which they have succeeded. However, they would not be required to pay court-fees and they will furnish undertaking to the Court that they will pay court-fees if necessary in light of the decision of the Supreme Court in the appeal pending before it from the decision of this Court in Lady Tanumati's case, (1973) 14 Guj LR 537 (1713). The State shall bear its own costs and pay the costs of both the claimants as above. Decree to be drawn accordingly.
25. Order accordingly.