Delhi District Court
Sh.Chandra Pratap Singh vs Union Of India on 24 May, 2014
IN THE COURT OF SH. REETESH SINGH
ADDITIONAL DISTRICT JUDGE-01 (NORTH-EAST)
KARKARDOOMA COURTS, DELHI
LAC No. 1/2009
Date of Institution of case : 28.4.2009
Date on which Reserved for Judgment : 3.5.2014
Date of Judgment/Order : 24.5.2014
Case I.D. Number : 02402C0135812009
IN THE MATTER OF:-
SH.CHANDRA PRATAP SINGH
SON OF SH. B.P.SINGH
THROUGH HIS GENERAL ATTORNEY SH. B.P SINGH
SON OF LATE SH. RAJINDER SINGH
RESIDENT OF D-241, ANAND VIHAR DELHI
......PETITIONER
VERSUS
1. UNION OF INDIA
THROUGH LAND ACQUISITION COLLECTOR
DISTT NORTH EAST
DELHI
2. DELHI METRO RAIL CORPORATION
THROUGH ITS CHAIRMAN
N.B.C.C. BUILDING
BHISHAM PITAMA MARG, LODI ESTATE
NEW DELHI 110 003
.......RESPONDENTS
J U D G M E N T
1. A reference under Section 18 of the Land Acquisition Act 1894 (hereinafter referred to as the said Act) has been made to this Court by the office of the Land Acquisition Collector (North-East) Delhi (hereinafter referred to as the LAC). The statement under Section 19 of the Act accompanying the same states that the petitioner had not accepted the award bearing No.2/2007-08 rendered by the LAC under Section 11 of the Act in respect of lands acquired in village Jhilmil Tahirpur LAC 1/2009 1/48 Delhi. As per the details mentioned in the statement under Section 19, the name of the project for which land was acquired in village Jhilmil Tahirpur was 'Construction of Shahdara-Dilshad Garden Corridor of Delhi MRTS Project Phase II at GT Road, Shahdara', for which notification under Section 4 was issued on 12.4.2006 and notifications under Sections 6 and 17 of the Act were issued on 22.5.2006 in respect of land measuring 16 bigha 16 biswas. Possession of the acquired lands was taken by the LAC on 17.8.2006. The details of the lands of the petitioner as mentioned in the statement under Section 19 of the Act are as under:
Sl. No. Name of the Petitioner Field No. Total Area Share Bigha Biswa
1. Chandra Pratap Singh 1183/20/1 97.40 sqmtr 100%
2. The statement under Section 19 of the Act is accompanied with a copy of award no.2/2007-08 of the LAC. The summary of the same is reproduced as under:-
"Summary of the Award
1. Rate of 1 Sq.Meter (Commercial) Rs.6,450/-
2. Market value of the land measuring Rs.9,07,38,600/- 16 Bigha 16 Biswas i.e. 14068 Sq.Mtr.
3. Solatium @ 30% of market value Rs.2,72,21,580/-
4. Additional amount @ 12% of market value w.e.f. 12.04.2006 (date of not. U/s 4) to 17.8.2006 (date of possession) (128 days) Rs. 38,18,479/-
5. Cost of Structures Rs. 7,35,83,520/-
6. Total amount of compensation Rs.19,53,62,179/-
7. Interest U/s 34 of L.A.Act @ 9% for one year Rs. 1,75,82,596/-
8. Interest U/s 34 of L.A.Act @ 15% for 106 days Rs. 85,10,298/-
9. Total Rs.22,14,55,073/-"
3. The statement under Section 19 of the Act is also accompanied with the copy of the petition filed by the petitioner before the LAC praying for a reference to this Court under Section 18 of the Act. The reference of the petitioner was received by this Court from the LAC on 28.4.2009. Court notices were issued to the LAC 1/2009 2/48 petitioner, LAC as well as the Delhi Metro Rail Corporation (herein after referred to as the DMRC), the beneficiary of the acquisition.
4. In response to the Court notices, the petitioner, Union of India (hereinafter referred to as the UOI/ LAC) and the DMRC appeared before this Court and filed their responses to the same.
PLEADINGS OF THE PARTIES:-
5. In the petition filed before the LAC, the petitioner has contended that the LAC has assessed the market value of the acquired lands on the basis of the lowest rates fixed for leasehold lands which had been prescribed by the Govt. of India, Ministry of Urban Affairs and Employment, Department of Urban Development (Land Division) vide notification dated 16.4.1999 for the period 1.4.1998 to 31.3.2000. It is submitted that the said rates had been prescribed for the purposes of charging lease money and transfer charges. It is submitted that the LAC allowed an increase of 10% and fixed the market value of approved industrial and commercial freehold land at a low rate of Rs.6,450/- per sqmtr., treating the land as residential. It is further submitted that the LAC has not treated the structures standing on such lands as 'land' as defined under the Act and has failed to grant 30% solatium on the market value of the structures as well as additional amount of 12% as provided under Section 23 of the Act on the same. It is submitted that the market value of the structures has also been incorrectly assessed at low rates.
6. In the grounds preferred in the petition, the petitioner has submitted that the LAC failed to take into consideration the instances of sale of similarly situated lands by open auction conducted by a bank for recovery of outstanding loans and other instances of sales of similar lands in the area. It is submitted that the LAC has based its award on the minimum rates fixed by the Government of India pertaining to leasehold residential lands. It is submitted that the LAC has failed to consider that such minimum rates were fixed about seven years prior to the date of notification under Section 4 of the Act while during this period there was LAC 1/2009 3/48 tremendous development and demand for approved industrial lands.
7. The petitioner has further contended that the LAC has failed to appreciate that his land was freehold land value of which was much higher than leasehold lands and that even the Government of India levied certain charges in the form of percentage while converting leasehold land to freehold. It is submitted that the LAC failed to appreciate that the acquired land was situated in an approved industrial cum commercial area where all amenities for running industrial establishments were available much prior to the date of notification under Section 4 of the Act. These facilities were in the form of grant of license to run a factory, branches of several banks in the area, proximity to a Railway Station, National Highway - 8 i.e. GT Road, availability of regular transport facilities, hospitals, educational institutions, supply of electricity and various forms of communication. It is submitted that the market value of the land if sold in the open market under the prevalent conditions of demand and supply, would not be less than Rs.50,000/- per sqmtr. which the petitioner claims to be the fair market value of his land. The petitioner therefore prayed that he be granted market value of his land at the rate of Rs.50,000/- per sqmtr. and Rs.5,00,000/- over and above the rate fixed by the LAC for the structures appurtenant to the land other besides other statutory benefits.
8. Written statement to the claim of the petitioner was filed by the LAC. The LAC in its reply made preliminary submissions to the effect that the compensation assessed by the LAC was sufficient and reasonable as the same reflected its true market value prevailing at the time of issuance of notification under Section 4 of the Act. It is stated that various factors were taken into account while assessing the market value and the petitioner was claiming an excessive and exorbitant market value of the land as well as the structures acquired. It is submitted that the LAC considered the "Schedule of Market Rates" of lands in various localities in Delhi issued by the Ministry of Urban Affairs and Employment, Govt of India circulated by notification dated 16.4.1999. It is stated that the notification under Section 4 of the Act was issued by 12.4.2006 but it was found that the schedule of market rates had LAC 1/2009 4/48 not been revised with effect from 1.4.1998. The LAC therefore permitted 10% escalation in respect of commercial / industrial rates to the proximate area of Jheel Kuranja and Geeta Colony with effect from 1.4.1998. It is averred that the rates announced for the said areas were Rs.5,865/- and upon escalation by 10% came to Rs.6,450/- per sqmtr (rounded off). It is submitted that the figure of Rs.6,450/-per sqmtr. for the acquired lands was held to be the true market value of the acquired lands, besides statutory benefits.
9. It is further submitted that the LAC assessed the fair market value of the lands after considering its current use, potentiality for future land use and proximity of land in the locality. It is submitted that market value of Rs.6,450/- per sqmtr also conforms to the land use of the area which was commercial / industrial as per the documents filed by the claimant as well as the DMRC. It is submitted that the structures appurtenant to the land were evaluated by the DMRC which were vetted by the PWD, Govt of NCT of Delhi and the same were accepted by the LAC after due consideration. It is submitted that the petitioner is not entitled to any enhancement of the compensation as assessed by the LAC.
10. The DMRC also filed its objections to the reference petition. In its preliminary submission, it has been averred that the DMRC is a joint venture of the Govt. of NCT of Delhi and the Govt. of India for the purposes of construction and implementation of the MRTS project in the National Capital Region. It is submitted that the said project being of immense public importance, the Government was under an obligation to provide land for the implementation of the project. It is submitted that the land in question was acquired for construction of the Shahdara Dilshad Garden Corridor of Phase II of the Project by the Land and Building Department. It is submitted that the LAC after affording opportunity to the claimants and the authorities to adduce evidence in support of their contentions passed the award in accordance with law, taking into consideration all the relevant facts and circumstances. It is submitted that the present petition is an attempt on the part of the petitioner to cover up his lacunae while adducing evidence before the LAC to LAC 1/2009 5/48 derive an undue advantage to which he is not entitled. In the reply on merits, the DMRC denied that the LAC had incorrectly assessed the market value on the basis of lowest rates. It is contended that the LAC treated the lands in question as commercial / industrial and not as residential as alleged by the petitioner. The grounds raised by the petitioner have also been denied.
11. The petitioner filed replications to the written statements of the LAC as well as DMRC in which he denied the averments made in the same and reiterated the contentions made by him made in his petition ISSUES:-
12. The following issues were framed on the pleadings of the parties by order dated 26.4.2010:-
1. What was the market value of the land in question on the date of notification under Section 4 of the Land Acquisition Act? OPP
2. Whether the petitioner is entitled to any enhancement in the compensation? If so, at what rate? OPP
3. Relief EVIDENCE LED BY THE PARTIES:-
13. The petitioner filed evidence by way of affidavit of Sh.BP Singh, his attorney as PW-1 but the same was not tendered in evidence. In other words, even though his affidavit was filed, Sh.BP Singh was not examined as a witness on behalf of the petitioner.
14. The petitioner examined Sh.Dalip Baijal, Manager from Zonal office of Punjab & Sind Bank, Siddhartha Enclave, New Delhi as PW-2. He produced the auction register, Ex.PW2/1, pertaining to Abhimanyu Hospital, property no.D-31, Man Sarovar Park, Shahdara Delhi 110 032 which was auctioned on 15.6.2005. He deposed that the bid for Rs.40,25,000/- was accepted as final. He deposed that the original sale certificate in respect of property was issued in favour of the LAC 1/2009 6/48 purchaser Sh.Rajinder Kumar. He produced the necessary record as Ex.PW-2/2 to which an objection was raised by the counsel for the respondent on the ground of mode of proof. However, this objection was not pressed at the time of final arguments.
15. PW-2 was cross examined by the counsel for the UOI wherein he deposed that the said auction was not conducted during his tenure. He deposed that he had not visited the auctioned property and was not aware about the advantages and disadvantages of the auctioned property during the year 2005. He deposed that his evidence was based on the basis of record only. He was also cross examined by the counsel for the DMRC wherein he deposed that the auction property was mortgaged with the bank and he was not aware about the dimensions of the said property. He was not aware about the extent of the construction existing on the property or whether any hospital was being run from the same. He deposed that as per the bank records the auctioned property was described as a hospital. He was not aware whether any fittings and fixtures or hospital equipment were also auctioned with the property. He denied the suggestion that the same were auctioned with the said property. He deposed that Sh.RK Jain had purchased the said property and admitted that he was a doctor by profession in their records. He was not aware whether the said Dr. Jain was previously working in the auctioned hospital or not. He was not aware whether Dr. Jain was set up as a dummy purchaser by the hospital or its owners to retain the hospital at any cost and at the same time to pay its outstanding dues and deposed that the auction was public.
16. PW-3 is Naresh Kumar, an LDC from the office of the Land & Development Office, Nirman Bhawan, New Delhi. He produced the record relating to the schedule of market rates issued by the Land Division Branch, Ministry of Urban Affairs and Employment, Government of India for the period 1.4.1998 to 31.3.2000 and proved the same as Ex.PW-3/1 (collectively). He deposed that the said rates had not been revised till date (till the date of examination of this witness i.e. 27.11.2010). In his cross examination, he deposed that he had no personal knowledge regarding LAC 1/2009 7/48 revision of rates prior to 1.4.1998. He deposed that he had no knowledge whether the rates were revised upwardly by 10% during each revision. The cross examination conducted by the counsel for the UOI was adopted by the counsel for the DMRC.
17. PW-4 is Sh.TD Jethwani, Branch Manager from Sate Bank of India, Anaj Mandi Shahdara Delhi. He produced the record relating to auction sale of property No.8/90, Gali Jain Mandir, Chhota Bazar Shahdara which was auctioned on 27.9.2006. He proved the same as Ex.PW-1/4 (collectively). In his cross examination on behalf of the UOI, this witness deposed that he had been posted as Manager in the said branch since 24.6.2010 and that auction of the said property was not conducted during his tenure. He deposed that he had not seen the actioned property and was not aware of its advantages and disadvantages in the year 2006. He stated that he was deposing on the basis of the record and did not have any knowledge about the distance of Jhilmil Tahirpur from the auctioned property.
18. PW-4 was also cross examined by the counsel for the DMRC when he deposed that he was not aware of the dimensions of the auctioned property and the extent of construction thereon. He deposed that the auction register which had been brought him was maintained annually for all auctions. A specific question was put to this witness that as per the register brought by him, another property was auctioned on 27.9.2006 in Shahdara by the bank for Rs,4,50,000/- to which he answered in affirmative. The witness was directed to file on record copy of the entry in is register pertaining to this auction. This question put to this witness was objected to by the counsel for the petitioner but at the time of final arguments, the said objection was not pressed. PW-4 deposed that he was not aware as to whether prior to 27.9.2006 the bank had auctioned other mortgaged property or not but deposed that he could verify the same from the record. He could not say whether the bank fixed minimum reserve prices of properties put to auction on the basis of outstanding dues of a borrower.
LAC 1/2009 8/4819. PW-5 is GK Bajwan, Patwari from the office of the LAC (North East). He brought the record relating to Award No.2/2010/2011 (Dist. North East) Jhilmil Tahirpur Delhi. He deposed that the said award was announced on 15.3.2011 and proved the record relating thereto as Ex.PW-5/1. He deposed that the said award related to the area of Jhilmil Tahirpur Industrial Area. He deposed that as per the record available with him, Friends Colony Industrial Area fell in category "G" and the compensation was settled by the LAC at the rate of Rs.27,400/- per sqmtr. by applying multiplicative factor of 2 to the circle rate. In cross examination by the UOI, PW-5 admitted that the award Ex.PW-5/1 was subsequent to 12.4.2006 which was the date of notification under Section 4 of the Act in the present case. He deposed that he was not posted in the office in the year 2006 and that notification under Section 4 of the Act in respect of the award Ex.PW-5/1 was issued on 9.3.2010. His cross examination conducted by the counsel for the UOI was adopted by the counsel for the DMRC.
20. PW-5 was summoned again and he produced record relating to award No.1/2011-12 Distt. North East Jhilmil Tahirpur Delhi and proved the same as Ex.PW-5/2. He deposed that the said award pertained to land in village Jhilmil Tahirpur. In his cross examination by the counsel for the UOI, he admitted that the date of notification under Section 4 of the Act was issued on 29.6.2009 and was prior to 12.4.2006. His cross examination conducted by the counsel for the UOI was adopted by the counsel for the DMRC.
21. PW-6 is Sh.PC Tiwari LDC from the office of the Sub Registrar, Nand Nagri. He produced the record relating to circle rates for valuation of land and properties in the year 2011 onwards and proved the same as Ex.PW-6/1. In his cross examination by the UOI, he deposed that the rates prescribed under Ex.PW-6/1 and as produced by him were applicable with effect from February 2011 and he was not aware of the category of the land in question. His cross examination conducted by the counsel for the UOI was adopted by the counsel for the DMRC.
LAC 1/2009 9/4822. PW-7 is Sh. Vijay Kumar UDC from the office of Sub Registrar VIII Geeta Colony Delhi. He produced and proved the records - an agreement to sell and purchase executed by M/s STC Developers (Private) Limited in favour of M/s Kay Three Estates Pvt. Ltd as Ex.PW-7/1, a registered Gift deed executed by Prabhu Dayal as Ex.PW-7/2 and a sale deed executed by M/s Friends Ice Private Limited in favour of M/s Capital Cars Pvt. Ltd as Ex.PW-7/3. In cross examination, he deposed that he was posted in the East Distt. office of the Sub Registrar and that he had produced record relating to properties situated in East District, Delhi. He was not aware whether Jhilmil Tahirpur fell in North East Distt., Delhi. He was not aware that the record brought by him did not pertain to any property falling in Jhilmil Tahirpur. The cross examination conducted by the counsel for the UOI was adopted by the counsel for the DMRC.
23. PW-8 is the Patwari from the office of the SDM Seemapuri. He was summoned to produce the 'Aks Shijra' or Map of Mansarovar Park and Jhiilmil Tahirpur but he deposed that the said record was available with the DDA, INA Vikas Sadan, New Delhi
24. PW-9 is Saleem Ahmad - Patwari from the office of SDM Vivek Vihar (LM Bandh Road) Shastri Nagar. He produced the 'Aks Shijra' of Aks Shijara of village Chandrawali @ Shahdara and deposed that as per the same the acquired property was at a distance of 2-½ kms (if measured aerially) from Bhola Nath Nagar and 3-½ kms. from Mansarovar Park. He deposed that Kanti Nagar was at an aerial distance of 3 kms from Mansarovar Park and Farsh Bazar was at an approximate distance of 1-2 kms from Mansarovar Park. In his cross examination by the counsel for the UOI he deposed that he was posted in the said office for the last 7-8 months and was not aware of the ground situation in the year 2006. He admitted that there was a railway line between Jhilmil Tahirpur and Mansarovar Park but denied that there was no connectivity between both the areas by road. He denied the suggestion that due to railway line there could not be any connectivity through road. He deposed that he was not concerned with village Jhilmil Tahirpur and not was aware about the LAC 1/2009 10/48 location of the same. He deposed that the there is a road connecting Farsh Bazar with Jhilmil Tahirpur and that there was a railway line which crossed the said road. He deposed that there was underpass beneath the railway line which is situated between GT Road and Subzi Mandi Shahdara. He deposed that the underpass was an old one and that there were two railway lines between Jhilmil Tahipur and Mansarovar Park - one line being the Delhi-Shamli line and the other being the Delhi-Aligarh line. He was not sure whether the underpass is on the Delhi-Shamli line or on the Delhi-Aligarh line. He deposed that the underpass was beneath both the lines, which were parallel to each other, and bifurcated after Delhi Shahdara Railway Station. He deposed that the railway line was not running through Jhilmil Tahirpur but ran through Chandrawali @ Shahdara.
25. PW-9 further deposed in cross examination that he had brought photocopy of Aks Shijra of village Jhilmil Tahirpur (Ex.PW-9/1). He deposed that Mansarovar Park was earlier connected with Jhilmil Tahirpur through a railway crossing (fatak) and now there was a flyover. He was not aware when the same was constructed and whether the railway crossing (fatak) had been demolished. He was not aware whether the flyover and railway crossing (fatak) were constructed at the same time or not. He denied the suggestion that the Mansarovar Park and Jhilmil Tahiprur were not well connected with each other or that Mansarovar Park and Jhilmil Tahipur had different potentialities. He pointed out an underpass at point A in Ex.PW-9/1 but denied the suggestion that Bhola Nath Nagar and Farash Bazar had different potential values as compared to Jhilmil Tahirpur. The cross examination conducted by the counsel for the UOI was adopted by the counsel for the DMRC.
26. PW-10 is Vijay Kumar Kanungo from the office of the DDA who produced the Aks Shijra (map) of village Jhilmil Tahirpur as Ex.PW-10/1. He deposed that Mansarovar Park was touching the area of Jhilmil Tahirpur which he pointed out as Mark A in Ex.PW-10/1. He admitted that the acquired properties fell on the main GT Road (at point B) including khasra No.1183/20 which he pointed out at point C on the said document. He deposed that both Geeta Colony and Jheel Kuranja were LAC 1/2009 11/48 approximately 10 kms away from Jhilmil Tahipur. He deposed that Shahdara was at a distance of 2 kms from the railway line going towards Loni which crossed Jhilmil. He further deposed that the said railway line was a bifurcating factor between the Jhilmil Tahirpur and Mansarovar Park. In his cross examination on behalf of the UOI, he deposed that Mansarovar Park was a village area. He deposed that he had joined his office in January 2011 and was not aware about situation existing in the year 2006. He deposed that there was no railway station in Village Jhilmil Tahirpur besides the railway line. The cross examination conducted by the counsel for the UOI was adopted by the counsel for the DMRC.
27. Petitioner Chander Pratap Singh was examined as PW-11 who deposed by way of affidavit Ex.PW-11/A and relied upon the following documents:
(i) Copy of the circle rates as mark 11/A;
(ii) Copy of the membership certificate of the petitioner as mark 11/B;
(iii) Copy of electricity bill for the period December 2002 - prior to the date of notification as mark 11/C;
(iv) Copy of the water bill for the year 2011 as mark 11/D;
(v) Copy of the complaint to the police regarding the industrial license issued by MCD in favour of the petitioner having been lost as mark 11/E;
(vi) Copy of the license issued by the Factory Licensing Department of the MCD in favour of tenant in part of the property as mark 11/F;
(vii) Copy of the receipt dated 29.12.2000 of security deposit of Rs.1,1,27,800/- made by the petitioner for installation of commercial electricity connection in the acquired property as mark 11/G;
(viii) Copy of the receipt dated 29.12.2000 of security deposit of Rs.1,1,27,800/- made by the tenant Yash Pratap Singh for installation of commercial electricity connection in the acquired property as mark 11/H; and
(ix) Copy of the permanent factory license issued by MCD as mark P.
28. PW-11 was cross examined by the counsel for the UOI wherein he admitted that he had not produced any revenue record about the ownership of the acquired land. He deposed that he was employed in industrial activity of fabrication of machine parts from his acquired property prior to acquisition. He admitted that apart from industrial license issued by the MCD, electricity and water connections, he had not produced any document to show the land use of the acquired property. He LAC 1/2009 12/48 could not remember whether the acquired land was Nazul land or DDA had jurisdiction over the same. He admitted that he had not filed any document issued by the DDA regarding land use of the acquired land. He admitted that he had not seen any sale deed relating to the year 2006 in respect of the land in the vicinity of the acquired land. He could not remember whether he received notices under Sections 9 and 10 of the Act. He could not remember whether he had filed any claim before the Land Acquisition Collector in pursuance of the notices. He could not remember whether he had produced on record any documentary evidence before the LAC. He deposed that he had filed notification regarding circles rates with effect from 2007 but could not remember if he had filed any other document regarding market value. He denied the suggestion that the LAC had rightly assessed the market value of the acquired land after considering all the factors prevalent at the time of issuance of notification under Section 4 of the LA Act. He denied the suggestion that he had not placed on record any other document regarding market value of the land as the market value assessed by the LAC was more than the actual market value prevalent at the time of issuance of notification under Section 4 of the LA Act. His cross examination conducted by the counsel for the UOI was adopted by the counsel for the DMRC.
29. Next witness examined by the petitioner was Vijay Singh - Office Incharge Factory License North Delhi Municipal Corporation. He was referred to as PW-11 (although it should have been PW-12). He produced the record relating to factory license No.18443 issued in the name of the petitioner Chandra Pratap Singh. He deposed that the said license was issued on 28.9.1998 and that only one copy of the license was issued which was handed over to him. No copy of the same was retained in the office file. He identified copy of the license on the court record (Mark A) as the one issued to the petitioner. He deposed that as per the on-line computer data base available on the MCD website, the said license was renewed up to 31.3.2005 and there was no order or cancellation of the license on the file. He deposed that he had also checked the record of license no.2006 issued in the name of Yash Pratap Singh in respect of property No.340-A/3,Ground floor, Friends LAC 1/2009 13/48 Colony Industrial Area GT Road Shahdara Delhi for engineering works. As per the on-line computer data base available on the MCD website, the said license was renewed up to 31.3.2007 and there was no order or cancellation of the license on the file.
30. In his cross examination by the UOI he deposed that he was posted in the department since June 2011 and the licenses in question were not issued in his tenure. He admitted that copies of the license were not available in their record but their details of issuance were available. He deposed that he had brought license issuance file and that records relating to renewal of license were maintained in the office computers. He deposed that he had brought extract of the data available on- line regarding renewal of license after verifying the same personally. He also deposed that he had no personal knowledge of the matter. His cross examination conducted by the counsel for the UOI was adopted by the counsel for the DMRC.
31. PW-12 is Anil Sharma, LDC from the Factory Licensing Department of the East Delhi Municipal Corporation (EDMC) who deposed that a factory license pertaining to a conforming area had been issued in the name of the petitioner in respect of property No.340-A/3 Friends Colony, Shahdara Delhi in the year 1998 and the said license was granted for the purpose of carrying on engineering works. This witness was cross examined on behalf of the DMRC wherein he deposed that as per the office noting dated 22.9.1998 the license was ordered to be issued subject to submission of NOC from DPCC within six months but as per record no such NOC was submitted. He deposed that the said license could be renewed but the record brought by him did not contain information regarding renewal of the license since the same is carried out by Citizen Service Bureau of the MCD. He deposed that the record of renewal would be available with the said Bureau. This witness was not cross examined on behalf of UOI.
32. PW-13 is Babu Shanker, AG-I, BSES YPL Division - Dilshad Garden Delhi. He produced the record relating to electricity connection having K No.623139988 LAC 1/2009 14/48 and deposed that the same was installed in property No.340-A/3 Friends Colony, GT Road Shahdara Delhi in the name of the petitioner on 8.1.2001 under commercial category. He deposed that a commercial electricity connection is issued only after proper commercial formalities are approved. He placed on record the entire record relating to issuance of the electricity connection in the acquired property as Ex.PW-12/1 (collectively). This witness was cross examined on behalf of the DRMC wherein the witness deposed that he had no personal knowledge of the matter and his deposition is based on the knowledge derived from the records maintained in the office.
33. PW-13 is Pawan Kapoor Factory Inspector EDMC, 419 Udyog Sadan, Patparganj, Industrial Area Delhi who deposed that the summoned record was still lying with the North Delhi Municipal Corporation and was yet to be transferred to EDMC and for this reason he was unable to produce the summoned record. He deposed that the desired record could be summoned from the office of the Deputy Commissioner Factory Licensing Department of the North DMC, Civic Center, Delhi.
34. Thereafter the petitioner closed his evidence.
35. On behalf of the UOI, Sh.Sachin Nawani Advocate for the LAC tendered in evidence copy of the award No.2/2007-08 as Ex.R-1 and tendered certified copies of the following sale deeds in evidence:-
(i) sale deed dated 13.2.2004 as per which property situated at Friends Colony Industrial Area measuring 65 sqyds was sold for a consideration of Rs.1,50,000/- as Ex.R-2;
(ii) sale deed dated 22.3.2004 as per which property situated at Friends Colony Industrial Area measuring 60 sqyds was sold for a consideration of Rs.1,20,000/- as Ex.R-3;
(iii) sale deed dated 22.4.2004 as per which property situated in the abadi of Jhilmil Tahipur measuring 100 sqyds was sold for a consideration of Rs.3,00,000/- as Ex.R-4;LAC 1/2009 15/48
(iv) sale deed dated 17.5.2004 as per which property situated in the abadi of Jhilmil Tahirpur measuring 170 sqyds was sold for a consideration of Rs.4,80,000/- as Ex.R-5;
(v) sale deed dated 29.7.2004 as per which property situated at Friends Colony Industrial Area measuring 80 sqyds was sold for a consideration of Rs.1,60,000/- as Ex.R-6;
(vi) sale deed dated 28.9.2004 as per which property situated in the abadi of village Jhilmil Tahirpur measuring 50 sqyds was sold for a consideration of Rs.1,50,000/- as Ex.R-7; and
(vii) sale deed dated 27.10.2004 as per which property situated in the abadi of Jhilmil Tahipur measuring 110 sqyds was sold for a consideration of Rs.3,00,000/- as Ex.R-8.
36. UOI thereafter closed their evidence. The DMRC did not lead any evidence in support of its contentions and its counsel adopted the evidence adduced on behalf of the UOI.
37. In support of her contentions, Ms. Dimple Dhamija learned counsel for the petitioner has relied upon the following case law:-
(i) Kapil Mehra (Major General) versus UOI & Others reported as 176 (2011) DLT 361
(ii) Ajay Kumar versus GNCT of Delhi & Others passed in WP(C) 2109/2008
(iii) GNCTD versus Ajay Kumar & Others reported in 2013(14) SCALE 155
(iv) PG Industries versus UOI & Others passed in WP(C) 3511/2008 and CM Application No.6730/2008
(v) Om Prakash versus State of Haryana reported in 2011 IV AD (SC) 384
(vi) Thakur Kuldeep Singh versus UOI & Others reported in 2010(2) SCALES 705
(vii) Rupinder Handa versus UOI being RFA 270/1972
(viii) Sant Gurbax Singh versus UOI & Others reported in 2005(80) DRL 559 (DB) LAC 1/2009 16/48
(ix) Karan Singh & Another versus UOI & Another
(x) A Vembusekaran versus Special Tehsildar Namakkal Civil Appeal No.(S) 6899/2002
(xi) Shub Ram versus State of Haryana & Another reported in 2010 (I) AD (SC) 619
(xii) Rameshwar Solanki versus UOI reported in AIR 1995 DEL 358
(xiii) Mehrawal Khewaji Trust Faridkot & Another versus State of Punjab & Another reported in 2012 V AD (SC) 110
(xiv) Sunder versus UOI reported in 93(2011) DLT 569
(xv) Patel Joitaram Kalidas & Others versus Special LAO & Another reported in 2006(13) SCALES 420 (xvi) State of West Bengal versus Seey Union Club reported in AIR 1972 Cal 225 (xvii) Collector Eraigarh versus Chaturbhuj reported in AIR 1964 MP 196 (xviii) Baboo Ram versus State reported in AIR 1980 All 324 (xix) State versus Mohd Yasim reported in AIR 1982 J&K 23 (xx) Rajeshwari versus Sub Collector Behrampur reported in AIR 1964 Orissa 12 (xxi) Collector Bilaspur versus Lachman reported in AIR 1965 HP 18 (xxii) State of Kerala versus Valliyana Ponnamma reported in AIR 1985 Ker. 01
38. On the other hand, to rebut the contentions of the petitioner, counsel for the UOI has relied upon the following case law:-
(i) Union of India versus Pramod Gupta reported in 2005 (12) SCC 1
(ii) ONGC versus Sendhabhai Vastram Patel reported in 2005(6) SCC 454
(iii) RP Singh versus UOI reported in 2005(7) SCC 24 LAC 1/2009 17/48
(iv) Gafar & Others versus Moradabad Development Authority reported in 2007(7) SCC 614
(v) Ranvir Singh & Others versus UOI reported in 2005(12) SCC 59
(vi) UP Jal Nigam versus M/s Kalra Properties Pvt Ltd reported in AIR 1996 SC 1170
(vii) Land Acquisition Officer versus Morisetty Satyanarayana reported in 20-02 (10) SCC 570
(viii) Printers House Pvt Ltd versus Cold Storage & Food Products & Others reported in 1994(2) SCC 134
(ix) Topan Dass Kundamal versus State 1995(5) SCC 336
(x)Shakuntala Bai & Others versus State of Maharastra reported in 1996(2) SCC 152
(xi) Kanwar Singh & Others versus UOI reported in 1998(8) SCC 136
(xii) MB Gopal Krishna & Others versus The Special Duty Collector reported in AIR 1996 SC 3149
(xiii) Lal Chand versus UOI reported in 163(2009) DLT 299 (SC)
(xiv) Bhule versus UOI reported in 170(2010) DLT 371
39. Counsel for the DMRC adopted the arguments of the UOI. I have heard counsel for the parties, perused the record of the case and have gone through the written submissions filed by the parties. My findings issue wise are as under:-
FINDINGS ON ISSUES 1 AND 2:-
40. I shall first deal with the case law relied upon by the Ld. Counsel for the parties. From a consideration of the same, the ratio laid down can be culled out as under:
• While determining the amount of compensation payable in respect of lands acquired by the State, market value of the same is to be determined. The basic principle is that market value means the price that a willing purchaser would pay to a willing seller for a property having due regard to its existing condition with all existing advantages LAC 1/2009 18/48 and its potential possibility when laid out in the most advantageous manner excluding any advantage due to carrying out of the scheme for which the property had been compulsorily acquired.
• There are different methods ascertaining market value. The methods of valuation which may be adopted are (i) opinion of experts (ii) price paid within reasonable time (ii) any bonafide transaction of purchase of land acquired or land adjacent having similar advantages (iii) capitalization method or its potential value for acquisition or developed or developing colonies or nearness to roads etc. • The comparable sales method is the preferred mode over other methods of valuation. The most relevant piece of evidence which can form basis of determining market value are sale deeds pertaining to portion of land belonging to the same area which has been acquired, executed prior to the date of notification under Section 4 of the Act. Factors to be kept in mind for determining market value on comparable sale method are that (i) sale must be a genuine transaction (ii) sale must have been executed at a time proximate to the date of issuance of notification under Section 4 of the Act, (iii) land covered by the sale must be in the vicinity of the acquired land, (iv) land covered by the sale must be similar to the acquired land and (v) the size of the plot of land covered by the sale must be comparable to the and acquired. If all the factors are satisfied then there is no reason why sale value of the land covered by the sales be not given for the acquired land. However if there is dissimilarity regarding location, sale, site or nature of land between the land covered by sale and lands acquired, it is open to the Court to proportionately reduce the compensation for the acquired lands than what is reflected in the sale depending upon advantages attached to the land.
• Where there were several exemplars with reference to similar land it was a general rule that highest exemplar, if the Court was satisfied that the same was a bonafide transaction, has to be considered and accepted. When land is being compulsorily taken away from a person, he is entitled to the highest value which similar land in the locality is shown to have fetched in a bonafide transaction between a willing purchaser and a willing seller near about the time of acquisition.
• Market value of the land is to be determined as on the date of publication of notification under Section 4 (1) of the Act and not as it prevails on the date on which land has been fully developed. In the absence of any direct evidence, the Court may take recourse to other methods. Admissible evidence in which cases would be the judgments and awards passed in respect of acquisition of land made in the same village or neighbouring village. Such judgments and awards in the LAC 1/2009 19/48 absence of any other evidence like sale deeds reports of experts and other relevant evidence, would be evidentiary value where notification under Section 4 of the Act is subsequent to a judgment or an award in respect of an earlier acquisition of land in the same or neighbouring villages. Increase in the market value as determined in the previous award can be given. The converse i.e. where notification under Section 4 (1) of the Act is subsequent, then a decrease can also be effected for arriving at a market value.
• Compensation cannot be ascertained with mathematical accuracy. Comparable instances have to be identified having regard to proximity of time as well as proximity with respect to situation. In order to determine market value of land acquired suitable adjustment will have to be made for various positive and negative factors which have been described as under:-
Positive factors Negative factors
(i) smallness of size (i) largeness of area
(ii) proximity to a road (ii) situation in the interior at a distance from
the road
(iii) frontage on a road (iii) narrow strip of land with very small
frontage compared to depth
(iv) nearness to developed area (v) lower level requiring the depressed
portion to be filled up
(v) regular shape (v) remoteness from developed locality
(vi) level vis-à-vis land under acquisition (vi) some special disadvantageous
factors which would deter a purchaser
(vii) special value for an owner of an
adjoining property to whom it may have
some very special advantage"
• Section 23 of the Act lists the factors to be considered by the Court to determine compensation. It provides that the claimant will be entitled to market value of the land as on the date of publication of notification under Section 4(1) of the Act. He would also be entitled to damages if any suffered by him because of acquisition of land. The function of the Court in determining the amount of compensation is to ascertain market value of the land as on the date of notification under Section 4 of the Act. The burden is on the claimant to establish that the amount awarded to him by the Land Acquisition Collector is inadequate and that he is entitled to more. Only if the initial burden is discharged the burden shifts on the State to justify the award.
• Section 24 of the Act precludes subsequent developments from being taken into considerable to determine compensation.
• Need to take into consideration the value of the land adjacent to the acquired land or near-about area which possess same potentiality to LAC 1/2009 20/48 work out the price fetched for determination of market value of the acquired land arises only when there is no evidence of value of the acquired land. Where evidence regarding value of the acquired land itself is on record, it is unnecessary to travel beyond that evidence in considering market value particularly for the adjacent land.
• The lands which are freehold and lands which are burdened with encumbrances make a difference while attracting a willing purchaser. Freehold land commands a higher compensation as compared to lands which are burdened with encumbrances. The effect of tenants in occupation would be an encumbrance and no willing purchaser would offer the same price as would be offered for freehold land.
• The guideline value or circle rates fixed by the authorities under the Stamp Act for determination of market value of the property are not final but are only prima facie rates prevalent in the area. The guideline value or circle rate cannot be taken to be of such worth on the aspect of market value of the land. However such guideline factors which are contained in non-statutory basic value registers are different when compared to the guideline market value and circle rates as determined by expert committees constituted under State Stamp law. Determination of guideline value or circle rates by expert committees constituted under a State Stamp Act are effected after following detailed a procedure laid down in the relevant rules and publication in the State Gazette after inviting objections or suggestions from the members of public. Such guidelines value or minimum rates for registration of properties determined under statutory procedure can form a relevant piece of evidence for determining market value.
• If the sale deeds relied upon the State reveals a lesser market value than the compensation awarded by the Collector, the same cannot be ignored but Section 25 of the Act provides that the Court should not award an amount which is lesser than what was awarded by the Collector.
• In the case of Om Prakash versus State of Haryana & Others (supra) it was held by the Hon'ble Supreme Court that the question of potentiality or potential value of acquired land can be recognized only some time in future and it was open to the land owners to contend that potential can be examined firstly at the time of reference under Section 18 of the Act, first appeal before the Hon'ble High Court or even in the Hon'ble Supreme Court as well. It was held that the collector is an agent of State Government and they are extra ordinarily chary in awarding compensation and land owners have to fight for decades before they are able to get their dues. It was held that although the Act provided for payment of solatium, interest and LAC 1/2009 21/48 additional about it was common knowledge that even these payments do not keep pace with the astronomical rise in prices in many parts of India and most certainly in North India and these payments cannot fully compensate for acquisition of land and payment of compensation in driblets. It was held that 12% per annum increase which courts have often found to be adequate in compensation matters hardly does justice to those land owners whose lands have been acquired as judicial notice can be taken of the fact that the increase is not 10 or 12 or 15 per cent per annum but is often up to 100% in a year for the land which has the potential of being urbanized or commercialized. The Hon'ble Supreme Court further held that there is wide spread tendency to undervalue the sale price and provision of Collector's rates has only marginally corrected the anomaly as these rates are also abnormally low and do not reflect the true value.
• In the case of Shub Ram versus State of Haryana & Another (supra) the Hon'ble Supreme Court found that the sale deeds relied upon by the LAC reveals consideration which was far less than the compensation offered by the LAC. In view of large variance in the market value disclosed by the sale deeds relied upon by the LAC and those by the claimants and the fact that value of the land disclosed in the sale deed relied upon by the LAC was even less than it was offered by itself. The inference which was drawn by the Hon'ble Supreme Court was that the sale deeds relied upon by the LAC were undervalued or were distress sales and are to be excluded from consideration as being unreliable.
41. The principles of law as enunciated are now to be applied to the facts and circumstances of this case order to ascertain market value of the land of the petitioner which have compulsorily been acquired by the State. Before proceeding further, it will be first appropriate to ascertain the nature of the lands which were acquired by the LAC. For this purpose one can straight away refer to the contents of the award of the LAC relevant portion of which is reproduced hereunder:
"The market value of the land under acquisition is to be determined with reference to the date of notification U/s 4 of the Land Acquisition Act, 1894 i.e. 12.04.2006. To arrive at a fair market value of the land under acquisition, the locality of the site, its current land use, the situation of the area, the quality, potentiality of future land use of the land are to be taken into consideration the L.A. Act. The properties under acquisition are situated adjacent to Shahdara Flyover and have commercial as well as industries activities in the vicinity. To ascertain the land use of the land under present acquisition the report of the joint survey conducted by the officials of Land LAC 1/2009 22/48 Acquisition Collector, Land & Building Department & Delhi Metro Rail Corporation were kept in mind. Papers submitted by the claimants also shows that it is an Commercial / Industrial area. The evaluation report as submitted by the D.M.R.C. and vetted by P.W.D. regarding the properties also confirm the above and use. As required under section 50(2) of the L.A.Act, the representative of the D.M.R.C. was also called to adduce evidence for the purpose of determining the amount of compensation and the said use of the land under acquisition was confirmed.
Keeping the above facts in mind, method of valuation of land under acquisition was examined. In the method, the schedule of rates circulates by Ministry of Urban Affairs @ Employment, Department of Urban Development (Land Division) vide No.J-22011/4/95-LD dated 16.04.99 for the period from 01.04.98 to 31.03.2000 was referred which are reproduced below :
Zone-V East Delhi S. Name of the locality Residential Commercial No. (Rs.per Sq.Mtrs) (Rs.per Sq.Mtrs)
---------------------------------------------------------------------------------------------
1. Jheel Khuranja 2805/- 5865/-
2. Geeta Colony 2805/- 5865/-
3. Narela & other outlying colonies 1980/- 4140/-
The area at Sl.No.3 falls in District North West and is located far off from location of the land under acquisition. The area at Sl.No.1& 2 though not in immediate proximity of the land under acquisition, are the nearest in terms of distance. Accordingly, the rates in respect of Jheel Khuranja and Geeta Colony for commercial land are being considered. The schedule of market rate of land in Delhi/New Delhi were originally notified for the period 1.04.1991 to 31.03.1992 were as per Ministry of Department of Urban Development (Land Division) vide No.J-22011/1/91-LD dated 24.01.1992 and were later on extended upto 341.03.1994 vide order No.J-22011/1/91-LD dated 03.03.1993, further extended upto 31.03.1996 vide Ministry of Urban Development vide order No.J-22011/1/93-LD dated 11.11.1994 and still further extended upto 31.03.1998 vide Ministry of Urban Affairs & Employment, Department of Urban Development (Lands Division) vide No.J-22011/1/4/95-LD dated 16.04.1999.
Notification under section 4 was issued on 12.04.2006. It has been pleaded that since L & DO rates have not been raised w.e.f.
01.04.1998 and escalation @ 10% be allowed w.e.f. 01.04.1998 till the date of notification under section 4. The land rates effective w.e.f. 01.04.1991 were continued till 31.03.1998 when they were revised LAC 1/2009 23/48 vide letter dated 16.04./1999 since the rates prevailing till 31.03.1998 were brought into force way back in 01.04.1991.The escalation of 10% in the rates announced w.e.f. 01.04.1991 to 31.03.1998 has to be calculated over the rates effective on 01.04.1991. Similarly the escalation of 10% was allowed in the rates announced w.e.f. 01.04.99 to 31.03.2000, hence I am of the view that there is also justification in allowing escalation of 10% over the rates effective w.e.f. 01.04.98 to 31.03.2000. The rates announced for Jheel Khuranja and Geeta Colony were Rs.5865/- and thereafter escalation @ 10 % it will come to Rs.6451/50 i.e. round off to Rs.6450/-.
In view of the above discussion and keeping in view the land use of the land under acquisition i.e. commercial/industrial, I am of the opinion that Rs.6,450/- per Sq.Mtr., after allowing escalation of 10% in the rates notified by the Ministry, for the entire land is fair and reasonable market value of the land and award the same accordingly."
(emphasis supplied)
42. From the contents of the Award of the LAC, it is apparent that the lands which have been acquired have been classified by the LAC to be commercial / Industrial. The LAC has used the terms commercial / Industrial interchangeably. As per the LAC, the valuation report submitted by the DMRC and vetted by the PWD confirms the said land use. It is therefore not in dispute that the land acquired by the LAC were commercial / industrial in nature.
43. Let us now consider the manner in which the LAC has arrived at the market value of the land. In the award, relevant portion of which has been reproduced above, the LAC has placed reliance on the schedule of rates circulates by Department of Urban Development (Land Division), Ministry of Urban Affairs & Employment, vide No.J-22011/4/95-LD dated 16.04.99 for the period from 01.04.98 to 31.03.2000. The LAC has observed that the schedule of rates prescribed in the said document pertains to East Delhi or Zone V for Jheel Khuranja, Geeta Colony and Narela. The LAC excluded the rates prescribed for Narela on the ground that the said area was very far from the acquired land. He further observed that Jheel Khuranja and Geeta Colony though were not in immediate proximity of the land under acquisition but nearest in terms of distance. He therefore considered the LAC 1/2009 24/48 rates prescribed for Jheel Khuranja and Geeta Colony for commercial land which was prescribed to be Rs.5,865/- per sqmtr. The LAC observed that notification under Section 4 of the Act had been issued on 12.4.2006 and that seven years had already passed after the said rates were announced which prevailed up to 31.3.2000. The LAC allowed escalation of 10% over the rate of Rs.5,865/- and determined the market price of the acquired land taken to be Rs.6,450/- per sqmtr.
44. The question which arises is whether the market value as assessed by the LAC and methodology the applied was correct or not. It is apparent that the market value was arrived at by the LAC on the basis of the Schedule of rates prescribed by the Government of India vide notification dated 16.4.1999 for the period 1.4.1998 to 31.3.2000. The notification under Section 4 of the Act in this matter was issued on 12.4.2006, i.e. more than seven years after the issuance of the said schedule of rates and the LAC was conscious of this fact. In order to ameliorate any price rise which may have taken place in these seven years, the LAC granted a onetime 10% escalation over the prescribed rate of Rs.5,865/-. The escalation granted by the LAC was not annual for each of the seven years but a onetime increase by 10%. As per the LAC the value of commercial / Industrial properties i.e. the acquire property would have increased by only 10% over a period of seven years. It is inconceivable that market value of commercial / industrial land will remain frozen for such a long time.
45. In the case of Om Prakash versus State of Haryana & Others (supra) the Hon'ble Supreme Court observed that grant of solatium, interest and additional amount do not keep pace with the astronomical rise in prices in many parts of India and most certainly in North India. It was held that 12% per annum increase which courts have often found to be adequate in compensation matters hardly does justice to those land owners whose lands have been acquired as judicial notice can be taken of the fact that the increase is not 10 or 12 or 15 per cent per annum but is often up to 100% in a year for the land which has the potential of being urbanized or commercialized. Further in the case of Mehrawal Khewaji Trust v. State of LAC 1/2009 25/48 Punjab reported in (2012) 5 SCC 432 the Hon'ble Supreme Court observed as under:-
"18. Based on the above principles, the market value as per Ext. A-61 dated 22-7-1977 was Rs 1,39,130.43 per acre (26pprox.. Rs 1.40 lakhs per acre). The said sale deed was two-and-a-half years prior in time than Section 4(1) Notification dated 22-12-1979. There is no reason to eschew the above sale transaction. It is also pointed out that the lands covered under Ext. A-61 are nearer to the lands of the appellants under acquisition.
19. This Court has time and again granted 10% to 15% increase per annum. In Ranjit Singh v. UT of Chandigarh5 this Court applied the rule of 10% yearly increase for award of higher compensation. In DDA v. Bali Ram Sharma6 this Court considered a batch of appeals and applied the rule of annual increase for grant of higher compensation. In ONGC Ltd. V. Rameshbhai Jivanbhai Patel7 this Court held that where the acquired land is in urban/semi-urban areas, increase can be to the tune of 10% to 15% per annum and if the acquired land is situated in rural areas, increase can be between 5% to 7.5% per annum. In Union of India v. Harpat Singh8, this Court applied the rule of 10% increase per annum.
20. Based on the above principle, we fix the annual increase at 12% per annum and with that rate of increase, the market value of the appellants' land would come to Rs 1,82,000 per acre as on the date of notification."
(Emphasis supplied)
46. Hence wherever market rate is determined on the basis of any particular method, i.e. comparable sales method or as per awards or judgements of similar lands, an annual increase in terms of percentage is always granted to provide for escalation of value of land between the date of the particular exemplar and the date of notification under Section 4 of the Act. Where lands are situated in urban or semi- urban areas, increase can be to the extent of 10 to 15% annually. In the present case undisputedly, the lands are commercial / industrial. They are situated and abutting GT road and a railway line.
47. In case of Om Prakash versus State of Haryana & Others (supra) the Hon'ble Supreme Court observed that collectors are agents of the State and are extra ordinarily chary in awarding compensation. The Ld. LAC in the present matter has demonstrated just that. Even though he was aware that more than seven years LAC 1/2009 26/48 had passed since the schedule of rated were issued on 16.4.1999, he granted a onetime increase of 10% assuming that market value of the land would remain static for seven years. On this ground alone the market value as determined by the LAC is fit to be rejected.
48. The onus to prove that the petitioner has been granted an inadequate value lies upon the claimant. In the present matter the LAC himself has demonstrated that market value determined by him was more than inadequate. In support of his contentions, the petitioner has relied upon sale transactions of certain properties and circle rates notified by the Govt. of NCT of Delhi under the provisions of Delhi Stamp (Prevention of Undervaluation of Instruments) Rules 2007 and awards passed by the LAC in respect of similar lands. I shall deal with the same one by one.
49. The first document relied upon by the petitioner is the record relating to auction of property B-31, Mansarovar Park, Shahdara, Delhi 110 032 which is Ex.PW-2/2 (collectively). As per the said records, the said property was auctioned for Rs.40,25,000/-. However there is nothing on record to indicate the size or dimensions of the said property to determine its value in terms of square meters. PW-2 in his cross examination has deposed that that he had not visited the auctioned property and was not aware about its advantages and disadvantages or the dimensions of the said property. Same is the case with respect to Ex.PW-4/1 (collectively), i.e. the records relating to auction of property No.8/90 Gali Jain Mandir, Chhota Bazar, Shahdara Delhi. The said property was auctioned for Rs.23,50,000/- but there is no record relating to the size of the said property. Further PW-4 in his cross examination deposed that he was not aware about the advantages or disadvantages of the said property or its dimensions. Thus in the absence of any record relating to the dimensions of both these auctioned properties, they cannot be considered for the purposes of determination of market value of the acquired lands.
LAC 1/2009 27/4850. Ex.PW-5/1 is the award of the LAC in case No.2/2010-11 (Distt North East) Jhilmil Tahirpur Delhi. The said award pertains to lands in Jhilmil Tahirpur Industrial area in which the LAC has granted compensation at Rs.27,400/- per sqmtr. Perusal of the award reveals that the lands under the said acquisition fell in khasra No.1185/20/2 which is similar to the properties acquired under the present acquisition. The LAC in the said matter placed reliance on three sale deeds of the same area / khasra number which were executed at Rs.27,400/- per sqmtr. and on the circle rates prescribed for category G - Industrial land use under notification dated 18.7.2007 issued by the GNCTD under the provisions of the Delhi Stamps (Prevention of Undervaluation of Instruments) Rules 2007. Under the said award, the notification under Section 4 (1) of the Act was issued on 9.3.2010 while in the present case the said notification was issued on 12.4.2006.
51. Ex.PW-5/2 is the award of the LAC bearing No.1/2011-12 Distt North East, Delhi. The same pertains to land falling in Dilshad Garden Industrial Area pertaining to khasra No.1183/220/1 min, 1183/220/2 min, 1183/220/3 min and 1183/220/4 min etc. The LAC has relied upon the circle rates prescribed for category G - Industrial land use under notification dated 18.7.2007 issued by the GNCTD under the provisions of the Delhi Stamps (Prevention of Undervaluation of Instruments) Rules 2007 and has determined the market value to be Rs.27,400/- per sqmtr. The notification under Section 4 (1) of the Act was issued on 29.6.2009.
52. Ex.PW-6/1 are the circle rates prescribed under notification dated 4.2.2011 issued by the GNCTD under the provisions of the Delhi Stamps (Prevention of Undervaluation of Instruments) Rules 2007. As per the same, the minimum value for residential use of land in category "G" was prescribed to be Rs.27,400/- per sqmtr. and a multiplicative use factor of "2" was prescribed for Industrial land and of "3" for commercial land. Applying the multiplicative use factor for industrial land, the minimum circle rates would come to Rs.54,800/- per sqmtr. However, the said notification was issued on 4.2.2011 whereas notification under Section 4 of the Act was issued on 12.4.2006.
LAC 1/2009 28/4853. Ex.PW-7/1 is the certified copy of a registered agreement to sell dated 6.2.2006 for property described as shop No.G-13 measuring 2340.48 sqft of super area and 1404.29 of covered area in the shopping cum multiplex Cross River Mall at 9-B and 9-C Central Business District Shahdara Delhi which was executed for a consideration of Rs.2,10,64,320/-. Ex.PW-7/2 is a certified copy of a registered Gift Deed dated 16.5.2006 in respect of 2nd floor measuring 15720 sqft (super built up area) or 12576 sqft (covered area) in the shopping cum multiplex Cross River Mall at plot No.3, Central Business District Shahdara Delhi. The stamp duty on the transaction was valued at Rs.3,61,56,000/-. Ex.PW-7/3 is a certified copy of a registered sale deed dated 20.3.2006 executed for Rs.9,25,00,000/- for property measuring 2,000 sqmtrs in plot No.1 Patparganj Industrial Complex, Delhi 110 092. Applied by the said rate the value per sqmtr. comes to Rs.46,250 sqmtr. PW-7 in his cross examination had deposed that all the documents produced by him pertained to Distt East, Delhi. He deposed that none of the documents brought by him pertained to Jhilmil Tahirpur Delhi.
54. These three deeds pertain to a commercial property known as "Cross River Mall" which is situated within Central Business District, Shahdara, Distt East, Delhi. The said property forms part of a developed Business District carved out under the Delhi Master Plan and Sub Zonal plan. The location of Central Business District Shahdara is not proximate to the acquired properties which fall along GT Road. Central Business District Shahdara is on the other side of the Ghaziabad-Old Delhi railway line. Hence these three documents Ext.PW7/1 to PW7/3 are excluded from consideration.
55. Ex.PW-9/1 is the Aks Shijara or map of village Chandrawali @ Shahdara. Ex.PW10/1 Aks Shijra of village Jhilmil Tahirpur. The maps indicate that the acquired lands fall between the Ghaziabad-Old Delhi railway line and the GT Road. The acquired lands are in very close proximity and have access to GT Road as well as the said railway line. Although there may not be a railway station just near or abutting the acquired lands, but judicial notice can be taken of the fact that the LAC 1/2009 29/48 acquired lands are in close proximity to the Vivek Vihar and Shahdara Railway Stations.
56. On the other hand, in order to justify market value arrived at by the LAC, the UOI has relied upon the following documents which are certified copies of the sale deeds of this very area from which the lands were acquired by the LAC. The same are as under:-
(i) certified copy of the sale deed dated 13.2.2004 as per which the property situated at Friends Colony Industrial Area measuring 65 sqyds was sold for a consideration of Rs.1,50,000/- as Ex.R-2
(ii) certified copy of the sale deed dated 22.3.2004 as per which the property situated at Friends Colony Industrial Area measuring 60 sqyds was sold for a consideration of Rs.1,20,000/- as Ex.R-3
(iii) certified copy of the sale deed dated 22.4.2004 as per which the property situated in the abadi of Jhilmil Tahipur measuring 100 sqyds was sold for a consideration of Rs.3,00,000/- as Ex.R-4
(iv) certified copy of the sale deeds dated 17.5.2004 as per which the property situated in the abadi of Jhilmil Tahirpur measuring 170 sqyds was sold for a consideration of Rs.4,80,000/- as Ex.R-5
(v) certified copy of the sale deed dated 29.7.2004 as per which the property situated at Friends Colony Industrial Area measuring 80 sqyds was sold for a consideration of Rs.1,60,000/- as Ex.R-6
(vi) certified copy of the sale deed dated 28.9.2004 as per which the property situated in the abadi of village Jhilmil Tahirpur measuring 50 sqyds was sold for a consideration of Rs.1,50,000/- as Ex.R-7 and
(vii) certified copy of the sale deed dated 27.10.2004 as per which the property situated in the abadi of Jhilmil Tahipur measuring 110 sqyds was sold for a consideration of Rs.3,00,000/- as Ex.R-8.
57. A perusal of value of the land sold under the above sale deeds varies between Rs.2,398/- to Rs.3,597/- per sqmtr. The dates of these sale deeds are between 13.2.2004 to 27.10.2004. Submission was made before this Court on behalf of the UOI the LAC has awarded more than double of the market value of the land prevailing at a time proximate to the issuance of notification under Section 4 of LAC 1/2009 30/48 the Act.
58. In the case of Lal Chand versus UOI (supra) the Hon'ble Supreme Court was pleased to hold that merely because sale deeds relied upon by the LAC / UOI reveal a lesser value of the acquired land cannot be a ground to exclude the same from consideration. Such documents are relevant pieces of evidence but on account of the bar contained in Section 25 of the Act the Reference Court cannot award any amount lesser than that awarded by the LAC. At the same time, the Hon'ble Supreme Court in the case of Shub Ram (supra), while taking into consideration its earlier judgment in the case of Lal Chand (supra) was pleased to exclude the sale deeds relied upon by the LAC from consideration on the ground that the sales revealed a price of land which was much lesser than that offered by the LAC and inference which was to be drawn was that the same were either grossly undervalued or were distress sales. The relevant portion of the observations of the Hon'ble Supreme Court in the case of Shub Ram (supra) are reproduced as under:-
"4. Ex.R-2 dated 27.1.1984 relied on by the LAC relates to sale of one acre of land for a price of Rs.30,000/- per acre. This is fr less than the compensation that was offered by the LAC. Having regard to the large variance between the market value disclosed by the twelve sale deeds exhibited and relied upon by the claimants (average of which is Rs.78/85) and the market value disclosed by Ex.R-2 (Rs.6/19 per sq yd) relied upon by KLAC and having regard to the fact that the value disclosed by Ex.R-2 was even less than what was offered by the LAC, it has to be inferred that Ex.R2 was either grossly undervalued or was a distress sale and has to be excluded from consideration, as being unreliable."
(emphasis supplied)
59. The value of the land revealed in the said sale deeds relied upon by the UOI are lesser than half of the amount offered by the LAC to the petitioner. In the case of Om Prakash (Supra) the Hon'ble Supreme Court held that there is a wide spread tendency to undervalue sale prices. In view of the judgment in the case of Shub Ram versus State of Haryana (supra) as well as Om Prakash (Supra), it can be inferred that these sale deeds were either grossly undervalued or were distress LAC 1/2009 31/48 sales. The same are therefore excluded for the purposes of consideration for determination of market value in these proceedings.
60. The exemplars relied upon by the petitioner as well as the UOI have been found to be unreliable for the purposes of determination of the market value of the acquired lands. What are we left with now to determine the market rate of the acquired lands?
61. As recorded above, the LAC has relied upon the rates prescribed on 16.4.1999 for commercial lands in Geeta Colony and Jheel Khuranja and has granted a onetime increase of 10% considering that the date of notification under section 4 of the Act was 12.4.2006. The market value as adopted by the LAC has been rejected by this Court as the same does not provide for an annual increase in reference to the schedule of rates relied upon by the LAC. Admittedly, the lands acquired are of industrial / commercial nature. It has been held by the Hon'ble Supreme Court repeatedly that where there is a time lag between the value under a particular exemplar and the date of notification under Section 4 of the Act, an annual increase in percentage terms must be applied to provide for escalation in value. In the case of Om Prakash versus State of Haryana & Others (supra) the Hon'ble Supreme Court was pleased to reiterate that Courts have often been giving 12% increase per annum but observed that judicial notice can be taken of the fact that increase can be sometimes not 10 or 12 or 15% per annum but often up to 100% per annum. Further in the case of Mehrawal Khewaji Trust v. State of Punjab (supra) the Hon'ble Supreme Court reiterated that where lands are situated in urban or semi-urban areas, increase can be to the extent of 10 to 15%.
62. Keeping in view that the lands in question were classified as industrial / commercial by the LAC, if an annual increase of 15% is applied to the rates prescribed by the UOI for Jheel Khuranja and Geeta Colony to Rs.5865/- per sqmtr., then the annual increase between 16.4.1999 to 12.4.2006 i.e. for seven years @15% per annum compounded would come as under:
LAC 1/2009 32/48 YEAR RATE
16.4.1999 Rs.5865/-
16.4.2000 Rs.6,725/-
16.4.2001 Rs.7,757/-
16.4.2002 Rs.8,921/-
16.4.2003 Rs.10,259/-
16.4.2004 Rs.11,798/-
16.4.2005 Rs.13,578/-
12.4.2006 Rs.15,615/-
63. Therefore while providing for an annual increase for 15% over the value of Rs.5,865/- as per the rates dated 16.4.1999, the market value of the acquired land would come to Rs.15,615/- as on 12.4.2006. However it is to be noted that both Jheel Khuranja and Geeta Colony are not be found anywhere in the documents Ex.PW-9/1 and Ex.PW-10/1. As per the evidence of PW-10, Jheel Khuranja and Geeta Colony are at distances of more than 10 kms. from the acquired lands. No evidence has been led by the UOI to demonstrate that the nature of the lands at Jheel Khuranja and Geeta Colony are similar to the acquired lands in any manner. The only similarity is that the both have been treated as commercial lands but there is no evidence regarding similarity of potentiality. It is to be noticed that the acquired lands are adjacent to and have access to GT Road and a railway line.
64. The petitioner has placed reliance on the circle rates notified under the provisions of the Delhi Stamp (Prevention of Undervaluation of Instruments) Rules 2007. In the case of Lal Chand versus UOI reported in (2009) 15 SCC 769 the Hon'ble Supreme Court observed in para 41 to 44 as under:-
"41. It should however be noted that as contrasted from the assessment of market value contained in non-statutory basic valuation registers, the position may be different, where the guideline market values are determined by Expert Committees constituted under the State stamp law, by following the detailed procedure laid down under the relevant Rules, and are published in the State Gazette. Such State Stamp Acts and the Rules thereunder, provide for scientific and methodical assessment of market value in different areas by Expert Committees.
42. These statutes provide that such Expert Committees will be constituted with officers from the Department of Revenue, Public Works, Survey & Settlement, Local Authority and an expert in the field of LAC 1/2009 33/48 valuation of properties, with the Sub-Registrar of the sub-registration district as the Member-Secretary. They also provide for different methods of valuation for lands, plots, houses and other buildings. They require determination of the market value of agricultural lands by classifying them with reference to soil, rate of revenue assessment, value of lands in the vicinity and locality, nature of crop yield for a specified number of years, and situation (with reference to roads, markets, etc.).
43. The rates assessed by the Committee are required to be published inviting objections/suggestions from the members of the public. After considering such objections/suggestions, the final rates are published in the gazette. Such published rates are revised and updated periodically. When the guideline market values, that is, minimum rates for registration of properties, are so evaluated and determined by the Expert Committees as per statutory procedure, there is no reason why such rates should not be a relevant piece of evidence for determination of market value.
44. One of the recognised methods for determination of market value is with reference to the opinion of experts. The estimation of market value by such statutorily constituted Expert Committees, as expert evidence can therefore form the basis for determining the market value in land acquisition cases, as a relevant piece of evidence. It will be however open to either party to place evidence to dislodge the presumption that may flow from such guideline market value. We, however, hasten to add that the guideline market value can be a relevant piece of evidence only if they are assessed by statutorily appointed Expert Committees, in accordance with the prescribed assessment procedure (either streetwise, or roadwise, or areawise, or villagewise) and finalised after inviting objections and published in the gazette. Be that as it may."
65. The Delhi Stamp (Prevention of Undervaluation of Instruments) Rules 2007 were framed under the provision of Sections 75 of the Indian Stamp Act 1899. In exercise of powers under Rule 4 of the said Rules and Sections 27 and 47-A of the Indian Stamp Act 1899 the Govt of NCT of Delhi notified the minimum rates (circle rates) for valuation of lands and immovable properties in Delhi. Perusal of the Rules reveal that under Rule 4 (a), the Government is empowered to notify minimum rates for valuation of land through a notification in the official Gazette for various Districts / areas forming part of a district. Such notification is to be issued on the recommendation of the Deputy Commissioner concerned. Rule 4 (b) provides that before notifying such rates the Government may in its discretion place these LAC 1/2009 34/48 rates in the public domain for a period of 15 days for inviting objections / suggestions and take a decision on the same, if so received.
66. Rule 4(2) provides that the Deputy Commissioner of each District shall undertake the exercise of valuation of immovable properties in consultation with the MCD, NDMC, Cantonment Board, DDA, L&DO (as appropriate) and such other land owning authorities of the Government of India and Govt. of NCT of Delhi. Rule 4(3) provides that valuation so fixed by the Government shall act as guide/indicator for the purposes of assessing duty chargeable on the value or the consideration of any immovable property.
67. The Deputy Commissioner of each District is entrusted with the task of framing the circle rates in consultation with the land owning agencies. Suggestions are also invited from members of the general public after consideration of which the circle rates are assessed and notified in the official Gazette. The entire exercise is thus statutory in nature and involves experts and members of the general public. Therefore, in terms of the judgment of the Hon'ble Supreme Court in the case of Lal Chand (supra) such estimation of market value by statutorily constituted expert committees under the provisions of the Delhi Stamp (Prevention of Undervaluation of Instruments) Rules 2007 are a relevant piece of evidence for determination of the market value of the acquired lands.
68. Counsel for the petitioner had relied on the judgment of the Hon'ble High Court in the case of Ajay Kumar versus Government of NCT of Delhi Writ Petition (C) 2109/2008. In the said matter the Hon'ble High Court of Delhi had found that while the Government fixed circle rates for registration of sale deeds, compensation granted by the LAC which was under consideration and challenge before the Hon'ble High Court, was much below the circle rates. The Hon'ble High Court through a series of orders observed that it would be justified if the Land Acquisition Collector be directed to determine the compensation at least on the basis of circle rates. The Govt of NCT of Delhi therefore issued a notification dated 23.2.2011 to LAC 1/2009 35/48 this effect. The Hon'ble High Court vide order dated 12.5.2011 disposed of the said Writ petition in view of the same with the observations and directions that the said notification would apply to all acquisitions made after the said order or where acquisitions were prior to the date of the said notification but reference or appeal was pending before the Competent Courts as the same were in continuation of acquisition proceedings.
69. The Govt. of NCT of Delhi being aggrieved by the said order, filed Civil Appeal No.8864/2013 before the Hon'ble Supreme Court which came to be decided on 23.9.2013 and as reported in 2013 (14) SCALE 155. The Hon'ble Supreme Court in the said matter was pleased to frame the following question for determination in para 2 of its judgment which reads as under:
"2.Whether the Division Bench of the Delhi High Court could while deciding the Writ petitions filed by the respondents for quashing the acquisition of their land, pass interim orders and compel respondent No.1 - Government of NCT of Delhi to issue notification making circle rates as prime criteria for determination of the compensation payable under Land Acquisition Act 1894 (for short the 1894 Act) and then direct that the same shall have made applicant to the acquisitions made prior to issuance of notification is the question which arises for consideration in these appeals."
70. The Hon'ble Supreme Court determined the said question and disposed of the said appeal with the following observations:-
"9.In the result, the appeals are disposed of by making it clear that the circle rates referred to in notification dated 23.2.2001 issued by appellant no.1 shall not constitute the sole criteria for fixing market value of the acquired land and the Land Acquisition Collector shall be free to make determination by taking into consideration the relevant factors and evidence which may in an appropriate case include circle rates."
71. The Hon'ble Supreme Court was therefore pleased to hold that circle rates could not form the 'sole' criteria for fixing market value of acquired lands and the LAC was free to determine the same by taking into consideration all relevant factors and evidence. It was however observed that in appropriate cases circle rates can LAC 1/2009 36/48 also be considered.
72. Thus as per the judgments of the Hon'ble Supreme Court in the case of Lal Chand (supra) and in the case of GNCTD versus Ajay Kumar (supra) circle rates are relevant evidences and can be considered for determination of market value of acquired lands.
73. In the case of Udho Dass v. State of Haryana reported in (2010) 12 SCC 51 the Hon'ble Supreme Court was pleased to hold as under:-
"16. Although, in the present matter, sale instances around or nearabout the date of the notification of the present acquisition are available yet these cannot justify or explain the potential of a particular piece of land on the date of acquisition as the potential can be recognised only sometime in the future and it is open to a claimant landowner to contend that the potential can be examined first at the time of the Section 18 reference, the first appeal in the High Court or in the Supreme Court in appeal as well. We must also highlight that Collectors, as agents of the State Government, are extraordinarily chary in awarding compensation and the landowners have to fight for decades before they are able to get their due. We take the present case as an example.
17. The land was notified for acquisition in May 1990. The Collector rendered his award in May 1993 awarding a sum of Rs. 2,00,000 per acre. The Reference Court by its award dated January 2001 increased the compensation to Rs. 125 per square yard for the land of the road behind ECE Factory and Rs. 150 per square yard for the land abutting the road which would come to Rs. 6,05,000 and Rs. 7,26,000 respectively for the two pieces of land. This itself is a huge increase vis-à-vis the Collector's award. The High Court in first appeal by its judgment of 24-9-2007 enhanced the compensation for the two categories to Rs. 135 and 160 respectively making it Rs. 6,53,400 and Rs. 7,74,400. In other words, this is the compensation which ought to have been awarded by the Collector at the time of his award on 12-5- 1993. This has, however, come to the landowner for the first time as a result of the judgment of the High Court which is under challenge in this appeal; in other words, a full 17 years from the date of notification under Section 4 and 14 years from the date of the award of the Collector on which date the possession of the land must have been taken from the landowner.LAC 1/2009 37/48
18. Concededly, the Act also provides for the payment of the solatium, interest and an additional amount but we are of the opinion, and it is common knowledge, that even these payments do not keep pace with the astronomical rise in prices in many parts of India, and most certainly in North India, in the land price and cannot fully compensate for the acquisition of the land and the payment of the compensation in driblets. The 12% per annum increase which courts have often found to be adequate in compensation matters hardly does justice to those landowners whose lands have been acquired as judicial notice can be taken of the fact that the increase is not 10 or 12 or 15% per year but is often up to 100% a year for land which has the potential of being urbanised and commercialised such as in the present case. Be that as it may, we must assume that the landowners were entitled to the compensation fixed by the High Court on the date of the award of the Collector and had this amount been made available to the landowners on that date, it would have been possible for them to rehabilitate their holdings in some other place. This exercise has been defeated for the simple reason that the payment of compensation has been spread over almost two decades.
19. In this view of the matter, we are of the opinion that a landowner is entitled to say that if the compensation proceedings continued over a period of almost 20 years as in the present case, the potential of the land acquired from him must also be adjudged keeping in view the development in the area spread over the period of 20 years if the evidence so permits and cannot be limited to the near future alone.
20. We, therefore, feel that in the circumstances, the appellants herein were fully entitled to say that the potential of the acquired land had not been fully recognised by the High Court or by the Reference Court. We must add a word of caution here and emphasise that this broad principle would be applicable where the possession of the land has been taken pursuant to proceedings under an acquiring Act and not to those cases where land is already in possession of the Government and is subsequently acquired.
21. There is another unfortunate aspect which is for all to see and to which the courts turn a Nelson eye and pretend as if the problem does not exist. This is a factor which creates an extremely grim situation in a case of compensation based exclusively on sale instances. This is the widespread tendency to undervalue sale prices. The provision of the Collector's rates has only marginally corrected the anomaly, as these rates are also abnormally low and do not reflect the true value. Where does all this leave a landowner whose land is being compulsorily acquired as he has no control over the price on which LAC 1/2009 38/48 some other landowner sells his property which is often the basis for compensation?"
74. The Hon'ble Supreme Court in the case of Udho Dass (supra) was pleased to hold that "potential" can be examined first at the time of the Section 18 reference, the first appeal in the High Court or in the Supreme Court in appeal as well.
75. The Govt of NCT of Delhi, for the first time, through notification dated 18.7.2007 notified the minimum rates (circle rates) under the provisions of Delhi Stamp (Prevention of Undervaluation of Instruments) Rules 2007. Under the said notification, localities in Delhi have been divided into 8 categories (A to H) and minimum rates for valuation of land for residential use have been notified category wise. The area of Jhilmil Tahirpur, where the acquired properties are situated, falls in category 'G'. The minimum rates category G is prescribed at Rs.13,700/- per sqmtr. The same is however for land meant for residential use. The notification also provides for a 'multiplicative use factor' to be applied to the rates for residential use for land having different uses. Multiplicative use factor of "2" is prescribed for industrial land and "3" for commercial land. If the multiplicative use factor of 2 is applied to category G then the minimum circle rates prescribed for lands with industrial use in category G would come to Rs.13,700/- x 2 i.e. Rs.27,400/- per sqmtr. Thus as on 18.7.2007, the circle rates for industrial land in category G i.e. where the acquire property is situated was Rs.27,400/- per sqmtr.
76. The LAC in its award has categorized the land use as industrial / commercial. The notification dated 18.7.2007 gives a multiplicative factor of 3 for commercial land. If multiplicative factor of 3 is applied to the rate of Rs.13,700/- the same comes to Rs.41,100/- per sqmtr. However the Delhi Stamps (Prevention of Undervaluation of Instruments) Rules as well as notification dated 18.7.2007 provide for different circle rates for lands with different uses. Industrial lands have a multiplicative use factor of 2 whereas commercial land have multiplicative use factor of 3. As these rules are statutory in nature, with different multiplicative use factors prescribed for different categories of land use, land for industrial use cannot be LAC 1/2009 39/48 taken to be synonymous with commercial lands. Moreover the petitioner himself has stated that his property was put to industrial use and he has proved on record his factory license as well. Thus if circle rates have to be applied to the acquired lands, multiplicative use factor of 2 for industrial category will alone be applicable. Therefore as on 18.7.2007 the minimum value of the acquired lands as per provisions of Delhi Stamp (Prevention of Undervaluation of Instruments) Rules 2007 was Rs.27,400/- per sqmtr.
77. The circle rates issued under the said Rules have been revised by the government at regular intervals. On 8.2.2011 the circle rates for residential land were doubled from Rs.13,700/- to Rs.27,400/- per sqmtr. The same were upwardly revised on 16.11.2011, within a span of nine months, to Rs.31,500/- and thereafter with effect from 5.12.2012 i.e. after one year to Rs.38,500/-. It is noticed that there has been a considerable increase of almost 300% in the circle rates fixed by the government within a span of five years. Rs.38,500/- when applied to the multiplicative factor of 2 for industrial lands comes to Rs.77,000/- per square meter. Thus as on 5.12.2012 the circle rate of the acquired lands was Rs.77,000/- per square meter.
78. The LAC has granted compensation at the rate of Rs.6450/- per sq.mtr. If an annual increase of 15% is applied to the base rate of Rs.5865/- as per the rates notified on 16.4.1999, the value as on 12.4.2006 comes to Rs.15,615/-. The circle rates notified on 18.7.2007 in respect of the same lands were Rs.27,400/- per sqmtr. It is inconceivable that there would be such an increase in the market value of the acquired lands between the date of the notification under Section 4 of the Act i.e. 12.4.2006 and the date of notification of circle rates i.e. 18.7.2007. Moreover as observed by the Hon'ble Supreme Court in the case of Udho Dass v. State of Haryana (supra) even the circle rates do not reflect the accurate rate as there is a wide spread tendency to undervalue sale deeds. The only inference which arises in these circumstances is that the market value of the acquired lands as on 12.4.2006 was most certainly not Rs.6450/- per sq.mtr. as awarded by the LAC or even LAC 1/2009 40/48 Rs.15,615/-, but somewhere near Rs.27,400/- per sqmtr as per the circle rates.
79. Although the notification under Section 4 of the Act was issued on 12.4.2006, as on date i.e. today the circle rates for category G are Rs.38,500/- per sqmtr. and when multiplicative factor of 2 for industrial use is applied, the same comes to Rs.77,000/- per sqmtr. In the case of Udho Dass v. State of Haryana (supra) the Hon'ble Supreme Court was pleased to observe that potentiality of land can be assessed at the stage of reference under Section 18 of the Act, at the stage of appeal before the Hon'ble High Court as well as before the Hon'ble Supreme Court. Applying the said ratio to the minimum rates prescribed under the provisions of Delhi Stamp (Prevention of Undervaluation of Instruments) Rules 2007, as on date the circle rates of the acquired lands are Rs.77,000/- per sqmtr. However the consistent view has been that the market value of the acquired land has to be determined with respect to the date of notification under Section 4 of the Act in reference proceedings under Section 18 of the Act.
80. The notification under Section 4 of the Act was issued on 12.4.2006. The circle rates under the provisions of Delhi Stamp (Prevention of Undervaluation of Instruments) Rules 2007 were notified for the first time on 18.7.2007. Is it permissible to rely upon statutory circle rates which have been framed about 1 year 3 and months after the date of issuance of the notification under Section 4 of the Act? The Hon'ble Supreme Court has held that in the absence of any other suitable evidence, awards and judgments in respect of similar lands acquired can be taken into consideration and appropriate increase or decrease depending upon proximity to the date of notification under Section 4 of the Act can be applied. By the same analogy, the statutory circle rates, which are relevant evidences as per the Hon'ble Supreme Court in the case of Lal Chand versus UOI (supra), can also be applied to determine the market value with appropriate decrease considering the date of notification under Section 4 i.e. 12.4.2006 and the date of notification of the circle rates i.e. 18.7.2007.
LAC 1/2009 41/4881. As on 18.7.2007 the minimum rates for acquired land were Rs.27,400/- per sqmtr. How much decrease in percentage terms to circle rates are to be applied for determining the market value of the acquired lands is the question. Although the following judgment of the Hon'ble High Court of Delhi seems to have gone unreported, in the opinion of the Court, the ratio laid down in the same is relevant for the present matter. In the case of Seema Grover Seth versus Govt. of NCT of Delhi, Writ Petition (c) 13122/2009 decided on 8.11.2011, the petitioner challenged the order of the Court of the Addl. District Judge which decided an appeal under Section 47-A of the Indian Stamp Act against an order of the Collector of Stamps. The facts of the case were that one Chander Bhan Grover executed a registered Gift Deed dated 1.5.2006 in favour of his son Sh.Sanjay Grover. The property which was the subject matter of the gift deed was valued at Rs,.19,00,000/- and the same was executed on non-judicial stamp paper of Rs.1,52,000/-. Ms.Seema Grover who is the sister of Sanjay Grover made a complaint to the Collector of Stamps stating that the gift deed had undervalued the property in question causing a loss to the Government. On the said complaint, the Collector of Stamps initiated proceedings under the provisions of the Stamp Act. Vide order dated 19.8.2008, the Collector of Stamps found that as per the circle rates notified on 18.7.2007 under the provisions of the Delhi Stamp (Prevention of Undervaluation of Instruments) Rules 2007, the minimum value of the property in question would be Rs.1,25,92,351/-. The Collector observed that even the circle rates as notified on 18.7.2007 are not market rates which are much above the circle rates. The Collector found that the circle rates were notified on 18.7.2007 but the gift deed was registered on 1.5.2006 and that even if the circle rates were reduced by 20% per annum the market value would not be less than Rs.75,55,411/- on which the stamp duty payable would be Rs.6,04,480/-. The Collector of Stamps therefore directed payment of deficit stamp duty of Rs.4,52,480/- and also imposed a penalty of Rs.2,82,800/- under Section 35 of the Stamp Act.
82. Aggrieved by the order of the Collector, Sh.Sanjay Grover filed an appeal under Section 47-A of the Stamp Act. His sister Seema Grover also filed an appeal LAC 1/2009 42/48 on the ground that valuation of the property was more than that assessed by the Collector. The Court of the Additional District Judge vide order dated 1.7.2009 allowed the appeal of Sanjay Grover and dismissed that of Seema Grover. The learned Additional District Judge, amongst others, held that circle rates were guidelines and not the last word on valuation on the property.
83. Dissatisfied with the order of the Additional District Judge, Seema Grover as well as the Govt. of NCT of Delhi filed Writ Petition (C) 13122/2009 before the Hon'ble High Court. The judgment of the Hon'ble Supreme Court in the case of Lal Chand versus UOI (supra) was cited before the Hon'ble High Court. The Hon'ble High Court vide order dated 8.11.2011 was pleased to set aside the order of the learned Additional District Judge and allowed the petition. The Hon'ble High Court observed that it was unable to accept the reasoning of the Additional District Judge regarding market price. It was held that the Collector was a statutory authority empowered to determine valuation and the District Court ought not to interfere lightly with the findings of such expert. The Hon'ble High Court further held that the act of the Registrar in giving a rebate of 20% per year on the circle rates which were notified on 18.7.2007 after registration of the Gift Deed on 1.5.2006 was proper as such mode of valuation was not unknown. The relevant portion of the said judgment of the Hon'ble High Court is reproduced as under:
"18. The Collector of Stamps in the present case held the valuation of Rs. 19 lacs on which stamp duty was paid to be grossly inadequate in the light of the circle rates which had come into force a little over one year after the date of registration in the present case. The Registrar also gave a rebate at the rate of 20% per year for two years in such valuation though the transaction as aforesaid was only a little over one year old. Such mode of valuation is not unknown. The whole purpose of prescribing the circle rates was to address the malaise of undervaluation of properties. Sh. Sanjay Grover has not challenged the said circle rates. It is an admitted fact that with effect from the circle rates coming into force the instruments are being accepted for registration at valuation not below the said circle rates. The Additional District Judge has not given any reason whatsoever for disagreeing with the said formula applied by the Collector of Stamps. It cannot be lost sight of that the Collector of Stamps is the statutory body empowered to determine the valuation. Though the appeals against the orders of the Collector of Stamps have been provided under Section 47- A to the District Court but the District Court ought not to interfere lightly with LAC 1/2009 43/48 the findings of such expert. The Additional District Judge in the present case has given only the reason of the donee being in possession of the property for disagreeing with the valuation arrived at by the Collector of Stamps. It can also not be lost sight of that even the Tehsildar, though without giving any basis arrived at about the same valuation as arrived at by such backward calculation from the date of coming into force of the circle rates."
(emphasis aupplied)
84. In the opinion of this Court the ratio of the judgment of the Hon'ble High Court in the case of Seema Grover (supra) is that it is permissible to apply circle rates under the provisions of the Stamp Act to arrive at the market value of an instrument for the purposes of assessment of stamp duty payable in respect of transactions relating to immovable properties. If the circle rates are prescribed at a time after execution of an instrument, it is open for the Collector to grant appropriate reduction to the circle rates to arrive at the market value keeping in consideration the time lag between execution of the instrument and notification of the circle rates.
85. To my mind, market value for the purposes of assessment and recovery of Stamp duty payable on an instrument can be based on circle rates notified after execution of the instrument, there is no reason as to why the same analogy cannot be applied for the purposes of arriving at the market value of lands compulsorily acquired by the State. Different yardsticks cannot be applied to arrive at market value for the purposes of collection of revenue for the State and for the purposes of grant of compensation for lands compulsorily acquired from citizens. It will be invidious for the State to contend that while it will rely upon circle rates notified after the date of execution of an instrument for the purposes of Stamp duty, it will not be open for owners of acquired lands to do so.
86. Apart from the above, there is yet another reason which leans towards reliance on circle rates for the purposes of arriving at market value of the acquired lands. The Land Acquisition Act 1894 has been repealed and has been replaced by the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The 'Statement of Objects and Reasons' LAC 1/2009 44/48 preceding the Act contains an insight as to why it was thought necessary to repeal the 1894 Act. Relevant portion of the same is reproduced as under:-
"Statement of Objects and Reasons.--The Land Acquisition Act, 1894 is the general law relating to acquisition of land for public purposes and also for companies and for determining the amount of compensation to be made on account of such acquisition. The provisions of the said Act have been found to be inadequate in addressing certain issues related to the exercise of the statutory powers of the State for involuntary acquisition of private land and property. The Act does not address the issues of rehabilitation and resettlement to the affected persons and their families.
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7. There is an imperative need to recognise rehabilitation and resettlement issues as intrinsic to the development process formulated with the active participation of affected persons and families. Additional benefits beyond monetary compensation have to be provided to families affected adversely by involuntary displacement. The plight of those who do not have rights over the land on which they are critically dependent for their subsistence is even worse. This calls for a broader concerted effort on the part of the planners to include in the displacement, rehabilitation and resettlement process framework, not only for those who directly lose their land and other assets but also for all those who are affected by such acquisition. The displacement process often poses problems that make it difficult for the affected persons to continue their traditional livelihood activities after resettlement. This requires a careful assessment of the economic disadvantages and the social impact arising out of displacement. There must also be holistic effort aimed at improving the all-round living standards of the affected persons and families.
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13. To ensure comprehensive compensation package for the land owners a scientific method for calculation of the market value of the land has been proposed. Market value calculated will be multiplied by a factor of two in the rural areas. Solatium will also be increased up to 100 per cent of the total compensation. Where land is acquired for urbanization, 20 per cent of the developed land will be offered to the affected land owners.
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14. Comprehensive rehabilitation and resettlement package for land owners including subsistence allowance, jobs, house, one acre of land in cases of irrigation projects, transportation allowance and resettlement allowance is proposed.
15. Comprehensive rehabilitation and resettlement package for livelihood losers including subsistence allowance, jobs, house, transportation allowance and resettlement allowance is proposed.
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17. Twenty-five infrastructural amenities are proposed to be provided in the resettlement area including schools and play grounds, health centres, roads and electric connections, assured sources of safe drinking water, Panchayat Ghars, Anganwadis, places of worship, burial and cremation grounds, village level post offices, fair price shops and seed- cum-fertilizers storage facilities.
18. The benefits under the new law would be available in all the cases of land acquisition under the Land Acquisition Act, 1894 where award has not been made or possession of land has not been taken."
87. The statement of objects and reasons preceding the 2013 Act reveal that the legislature was aware that the 1894 Act has proved to be grossly inadequate when it came to assessment of compensation for lands which are compulsorily acquired. The 1894 Act also did not provide for rehabilitation and resettlement of persons affected by acquisition. Under the 2013 Act, solatium has been increased to 100 % as compared to 30% under the 1894 Act. Further, for rural areas, the market value arrived at is to be multiplied by a factor of "2". Where land is acquired for urbanization, 20% of the developed land will be offered to the land owners. It is further provided that the benefits under the 2013 Act were proposed to be available in all cases of acquisition under 1894 Act where award had not been passed or possession had not been taken over.
88. Section 26 of the 2013 Act provides the manner in which the Collector is to determine market value of lands. It lays down the criteria to be followed by the Collector and prescribes that the Collector shall adopt, amongst others, the market value, if any, specified in the Indian Stamp Act, 1899 (2 of 1899) for the registration of sale deeds or agreements to sell, as the case may be, in the area, where the land is situated. Thus the 2013 Act statutorily incorporated circle rates for consideration for determining market value. Section 24 of the 2013 Act provides that in certain cases, land acquisition process under the 1894 Act shall be deemed to have lapsed. It provides that in cases where the Collector has not rendered his award then the provisions of 2013 Act would apply. Section 24(2) further provides that where an award has been passed by the Collector five years or more prior than the commencement of the 2013 Act but physical possession of acquired lands has LAC 1/2009 46/48 not been taken over or the compensation has not been paid, the said proceedings shall be deemed to have lapsed. Thus the intent and purport of the 2013 Act was to provide the substantial benefits available under the 2013 Act to as many persons as possible. nfortunately for the petitioner herein, he does not fall within the parameters of Section 24 of the 2013 Act so as to be entitled to its benefits.
89. Hence for the foregoing reasons recorded above, this Court deems it proper to place reliance on the circle rates notified by the Govt. of NCT of Delhi on 18.7.2007 under the provisions of the Delhi Stamps (Prevention of Undervaluation of Instruments) Rules 2007. As per the same, the circle rates for category "G" in respect of lands with Industrial use has been prescribed to be Rs.27,400/- per sqmtr. As the date of notification under Section 4 of the Act is 12.4.2006 while the circle rates were notified on 18.7.2007, I deem it proper to deduct 20% from the prescribed rate of Rs.27,400/- per sqmtr. Hence the market rate of the acquired lands comes to Rs.21,920/- per sqmtr.
90. The LAC has awarded an amount of Rs.6,450/- per sqmtr. As the market value of the acquired lands has been found to be Rs.21,920/- per sqmtr, the petitioner will be entitled to enhancement of compensation by Rs.15,470/- per sqmtr.
RELIEF
91. In view of the findings on issue no. 1 and 2, the petitioner is held entitled to enhancement of compensation by Rs.15,470/- per sqmtr. In addition, the petitioner would also be entitled to all statutory benefits, being 30% solatium on the market value in view of the compulsory nature of acquisition as per section 23 (2) of the Act and an additional amount of 12% p.a. on the market value as provided under Section 23 (1A) from the date of notification till the date of possession or award whichever is earlier. He would also be entitled to interest on the enhanced compensation @ 9% per annum from the date of dispossession till expiry of one year and thereafter @ 15% per annum till payment.
LAC 1/2009 47/4893. Reference is answered accordingly. Statement under Section 19, which is duly admitted by the petitioner be annexed along with the same. Copy of the award be sent to the LAC North-East, Delhi for information and necessary compliance within three months. As the acquired land has been placed at the disposal of Delhi Metro Railway Corporation as the ultimate beneficiary the liability of both the respondents would be joint and several. File be consigned to Record Room.
Announced and dictated to the steno in open court today i.e. 24.5.2014 (REETESH SINGH) Addl. Distt. Judge-01 (NE) Karkardooma Courts, Delhi LAC 1/2009 48/48