Allahabad High Court
Krishi Utpadan Mandi Samiti, vs Kanahaiya And 44 Othrers on 3 December, 2018
Author: Surya Prakash Kesarwani
Bench: Surya Prakash Kesarwani
HIGH COURT OF JUDICATURE AT ALLAHABAD A.F.R. Court No. - 59 1. Case :- FIRST APPEAL No. - 659 of 2014 Appellant :- Krishi Utpadan Mandi Samiti, Respondent :- Kanahaiya And 44 Othrers Counsel for Appellant :- Satish Mandhyan,Mahesh Chandra Chaturvedi,Suresh C. Dwivedi Counsel for Respondent :- Manish Goel 2. Case :- FIRST APPEAL No. - 53 of 2014 Appellant :- Krishi Utpadan Mandi Samiti Respondent :- Lalman And Anohter Counsel for Appellant :- Satish Mandhyan,Mahesh Chandra Chaturvedi,Suresh C. Dwivedi Counsel for Respondent :- Manish Goyal 3. Case :- FIRST APPEAL No. - 59 of 2014 Appellant :- Krishi Utpadan Mandi Samiti, Respondent :- Lal Singh And 3 Others Counsel for Appellant :- Satish Mandhyan Counsel for Respondent :- Manish Goyal 4. Case :- FIRST APPEAL No. - 109 of 2014 Appellant :- Krishi Utpadan Mandi Samiti Respondent :- Mohan And 4 Others Counsel for Appellant :- Satish Mandhyan Counsel for Respondent :- Manish Goyal 5. Case :- FIRST APPEAL No. - 548 of 2014 Appellant :- Krishi Utpadan Mandi Samiti, Respondent :- Ganga Ram And 6 Others Counsel for Appellant :- Satish Mandhyan,Mahesh Chandra Chaturvedi,Suresh C. Dwivedi Counsel for Respondent :- Manish Goyal 6. Case :- FIRST APPEAL No. - 550 of 2014 Appellant :- Krishi Utpadan Mandi Samiti, Respondent :- Net Ram (Deceased) And 4 Others Counsel for Appellant :- Satish Mandhyan,Mahesh Chandra Chaturvedi,Suresh C. Dwivedi Counsel for Respondent :- Maish Goyal 7. Case :- FIRST APPEAL No. - 551 of 2014 Appellant :- Krishi Utpadan Mandi Samiti Respondent :- Ganga Ram And 15 Others Counsel for Appellant :- Satish Mandhyan,Mahesh Chandra Chaturvedi,Suresh C. Dwivedi Counsel for Respondent :- Manish Goyal 8. Case :- FIRST APPEAL No. - 660 of 2014 Appellant :- Krishi Utpadan Mandi Samiti, Respondent :- Ganga Ram And 9 Others Counsel for Appellant :- Satish Mandhyan,Mahesh Chandra Chaturvedi,Suresh C. Dwivedi 9. Case :- FIRST APPEAL No. - 661 of 2014 Appellant :- Krishi Utpadan Mandi Samiti Respondent :- Chet Ram And 2 Others Counsel for Appellant :- Satish Mandhyan,Mahesh Chandra Chaturvedi,Suresh C. Dwivedi Counsel for Respondent :- Manish Goel 10. Case :- FIRST APPEAL No. - 686 of 2014 Appellant :- Krishi Utpadan Mandi Samiti Respondent :- Mohan And 5 Others Counsel for Appellant :- Satish Mandhyan Counsel for Respondent :- Manish Goyal 11. Case :- FIRST APPEAL No. - 687 of 2014 Appellant :- Krishi Utpadan Mandi Samiti, Respondent :- Budhan And Another Counsel for Appellant :- Satish Mandhyan,Mahesh Chandra Chaturvedi,Suresh C. Dwivedi Hon'ble Surya Prakash Kesarwani,J.
1. Heard Sri Shiv Sagar Singh, learned counsel for the Cross Objectors-claimants/respondents and Sri Mahesh Chandra Chaturvedi, learned Senior Advocate assisted by Sri S.C. Dwivedi, learned counsel for the appellants On Delay Condonation Applications, Civil Misc. Applications,Cross Objections and appeals.
2. In all these appeals cross objections alongwith delay condonation applications and the Misc. Applications have been filed by the claimants-respondents. Facts and grounds for delay condonation in all the objections are similar. Under the circumstances, the delay condonation application filed alongwith cross objection in leading First Appeal No. 659 of 2014 is reproduced below:
"1. That the deponent is the pairokar of the claimant-respondent in the above cross objection and as such he is well acquainted with the facts deposed to below.
2. That the appellant filed the present appeal as defective appeal before this Hon'ble Court.
3. That the delay in filing the appeal as condoned by this Hon'ble Court on 14.11.2013 and the Hon'ble Court was thereafter pleased to admit the present appeal.
4. That the claimant-applicant after admission of the appeal collected papers relating to the reference Court and came to Allahabad on 05.01.2014 for seeking advise about future course of action.
5. That in the conference of the deponent with the local counsel at Moradabad namely Sri Raju Sultan Advocate and with the counsel at Allahabad Sri Manish Goyal, Advocate the claimant-applicant decided to file the cross objections for remaining amount that was not awarded by the reference Court in its award dated 20.05.2013.
6. That upon instruction given by the claimant-applicant to the counsel present cross objections were drafted and are now being filed without any further delay.
7. That the delay if any is not deliberate. Prior to 05.01.2014 the claimant-applicant was not aware of the fact that he can prefer cross objections for the remaining amount and as such could not approach this Hon'ble Court earlier for instituting the present cross objections.
8. That the claimant will suffer irreparably if the delay in filing the cross objections is not condoned and the cross objections are not considered and decided on merits.
9. That under such circumstances it will be necessary in the interest of justice that the delay in filing the present cross objections may be condoned by this Hon'ble Court and the cross objections may be considered and decided on merits."
3. Perusal of the Delay Condonation Application as aforequoted, clearly shows that the Cross Objectors have not offered any explanation for delay for the period subsequent to 5.1.2014 till 24.2.2016. Thus, the long delay of 2 years and 73 days in filing all the cross objections filed in aforenoted First Appeals are wholly unexplained . Under the circumstances, all the Delay Condonation applications for condonation of delay in filing cross objections in the aforenoted First Appeals are hereby rejected. Consequently, all the Civil Misc. Applications and Cross Objections in all the aforenoted First Appeals also stand rejected.
On Appeals
4. Facts in all these First Appeals are common. All the First Appeals arise from the common judgment dated 20.5.2013, passed by the Additional District & Sessions Judge, Court No.13, Moradabad. Acquisition was made under one and the same Notification from which the references arose. Therefore, with the consent of learned counsels for the parties all these First Appeals are being heard together. Paper book has been filed by the appellants in the connected First Appeal No.53 of 2014.
Facts
5. Briefly stated facts of the present case are that by Notification No.516/12-5-87-600(103)-86, dated 1.5.1987, land measuring 23.525 acres of Village - Amroha, Tahsil - Amroha, District - Moradabad was acquired for construction of Krishi Utpadan Mandi. Notification under Section 6(1) of the Land Acquisition Act 1894 (hereinafter referred to as "the Act") was issued on 25.9.1987. Possession was taken on 30.11.1987. Award was made by the S.L.A.O. On 11.1.1988/22.12.1987. Aggrieved with the award, all the claimants-respondents filed reference application under Section 18 of the Act which was registered as L.A.R. Nos.129 of 1988 (Lalman Vs.State), 118 of 1988 (Budhan Vs. State), 119 of 1988 (Net Ram Vs. State), 120 of 1988 (Ganga Ram Vs. State), 122 of 1988 (Lal Singh Vs. State), 123 of 1988 (Ganga Ram Vs. State), 124 of 1988 (Dharm Singh Vs. State), 126 of 1988 (Mohan & others Vs. State), 127 of 1988 (Ganga Ram Vs. State), 159 of 1988 (Kanahaiya Vs. State), 160 of 1988 (Chet Ram Vs. State) & 161 of 1988 ( Ganga Ram Vs. State) which have been decided by the impugned common judgment dated 20.5.2013, passed by the Additional District & Sessions Judge, Court No.13, Moradabad, enhancing the compensation to Rs. 90 per sq. meter alongwith statutory benefits and interest.
6. Aggrieved with the aforesaid common judgment, the appellant Krishi Utpadan Mandi Samiti, Amroha (J.P. Nagar) has filed the present First Appeals.
7. Before the Reference Court the Claimants-respondents led documentary evidence being paper No.35 Ga (information submitted under RTI application), 36 Ga (information submitted under RTI application), 37 Ga (exemplar sale deed, dated 13.11.1989), 38 Ga decision dated 31.5.1995, 39 Ga judgment of High Court dated 21.4.2006, 40 Ga, judgment of High Court dated 5.2.2009 and 41 Ga order of Hon'ble Supreme Court dated 19.10.2009, 42 Ga, 43 Ga, 44 Ga, 45 Ga (maps), 46 Ga (gazette notification dated 19.10.1982), 49 Ga and 50 Ga (information submitted under RTI application). They led oral evidence of P.W. 1 - Lalman. The appellant - Krishi Utpadan Mandi Samiti, led the only evidence of one Sri Jaipal Singh who is the Secretary of the Samiti.
8. The main ground taken by the claimants-respondents for enhancement of compensation were the sale deed exemplar as per which the rate of land was Rs.154 per sq. yard, another acquisition made by the State Government in the year 1982 for Development of Residential colonies by Awas Vikas Parishad under which lands of the other side of the main road were acquired, the distance between the land acquired for the above noted two departments is about 500-600 meters in First Appeal No.229 of 1996 Uttar Pradesh Avas Vikas Parishad Vs. Kamlesh Chandra & others) and in First Appeal No.984 of 1989 Awas Vikas Parishad Vs. Jamil Ahmad & others), this Court determined the compensation @ Rs.52 per sq. yard which was with respect to the acquisition made in the year 1982 for U.P. Awas Vikas Parishad and the S.L.P. filed against these judgments of High Court were dismissed by Hon'ble Supreme Court.
9. The court below while determining the compensation of the land acquired under the present acquisition, relied upon the pleadings of the parties and the evidences led by them as well as the report of the Advocate Commission (paper No.60 Ga) and on that basis held that the lands acquired under the present acquisition is about 600 meters from the land acquired for U.P. Awas Vikas Parishad and situation of both the lands is almost similar. It has been observed that both the lands adjoin the residential abadi of city and geographically there is no dissimilarity. As per Advocate Commissions report the residential houses were existing adjacent to the acquired land. Consequently, the court below, instead of relying upon the sale deed exemplar filed by the claimants indicating market value of Rs.154/- per sq. yard, followed the market value determined by this Court as affirmed by Hon'ble Supreme Court in respect of the lands acquired for U.P. Awas Vikas Parishad i.e. Rs. 52 per sq. meter and adding the escalation @ Rs.10% per annum determined the market value of the acquired land @ Rs.90 per sq. meter. While granting escalation as aforesaid the court below relied upon the judgment of Hon'ble Supreme Court in Delhi Development Authority Vs. Bali Ram Sharma & others, 2004 (6) SCC 533.
10. Appellants - Krishi Utpadan Mandi Samiti has not led any documentary evidence. It led only one oral evidence i.e. evidence of D.W. 1 Sri Jaipal Singh, Secretary, Krishi Utpadan Mandi Samiti, Amroha, who stated in his cross examination on 6.8.2012 that he was working as Secretary since since 7.5.2012 and before that he was not working in Mandi Samiti, Amroha, and he was not present when possession of the acquired land was taken on 30.11.1987. He also stated that he made the statement about pits in acquired land on the basis of information received from office. No evidence could be filed by the appellants either to establish that the land is uneven or it is different from locational point of view or the market value point of view as compared to the adjacent huge land acquired for U.P. Awas Vikas Parishad. Admittedly the acquired land and the land acquired for U.P. Awas Vkikas Parishad are very close to the city. No sale deed exemplar or any other evidence were filed by the appellants with respect to the market value of the acquired land as against the documentary evidences led by the claimants-respondents.
11. In the case of Bhupal Singh Vs. State of Haryana, (2015) 5 SCC 801 (Para-27), Hon'ble Supreme Court held as under:
"27. As rightly argued by learned counsel for the respondent, the fair market value of the acquired land is required to be determined under Section 23 of the Act on the basis of the market rate of the adjacent lands similarly situated to the acquired lands prevailing on the date of acquisition or/and prior to acquisition but not subsequent to the date of acquisition. In appropriate cases, addition of 10% per annum escalation in the prices specified in the sale deeds (if filed and relied on) in relation to adjacent similarly situated lands for fixing the market value of the acquired land may be permitted. Such is, however, not the case in hand. Here is the case where firstly, no sale deeds were filed by the appellants to prove the fair market value of the acquired land and secondly, what they now want this Court to do is to take into consideration the rate of those lands which were acquired ten years after the date of acquisition in question and then reduce the value of such land by 10% every year so as to determine the fair market value of the acquired land in question. In our view, such procedure for determination is not provided in the Act."
(Emphasis supplied by me)
12. Similar view was taken by Hon'ble Supreme Court in the case of Delhi Development Authority (supra).
13. The facts as briefly noted above, particularly the fact that the acquired land is about 600 meters away from the residential colony of U.P. Awas Vikas Parishad as well as very close to the city; there remains no doubt that the acquired land is in urban/semi urban area.
14. In the case of Oil and Natural Gas Corporation Limited v. Rameshbhai Jivanbhai Patel and another 2008 (14) SCC 745 (paras 12 to 19), Hon'ble Supreme Court considered the question of escalation in prices and held as under:
12. We have examined the facts of the three decisions relied on by the respondents. They all related to acquisitions of lands in urban or semi-urban areas. Ranjit Singh VS. UT of Chandigarh 1992(4) SCC 659 related to acquisition for development of Sector 41 of Chandigarh. Land Acquisition Officer Vs.Ramanjulu 2005(9) SCC 594 related to acquisition of the third phase of an existing and established industrial estate in an urban area. Krishi Utpadan Mandi Samiti ... vs Bipin Kumar & Anr 2004(2) SCC 283 related to an acquisition of lands adjoining Badaun-Delhi Highway in an semi-urban area where building construction activity was going on all around the acquired lands.
13. Primarily, the increase in land prices depends on four factors - situation of the land, nature of development in surrounding area, availability of land for development in the area, and the demand for land in the area. In rural areas unless there is any prospect of development in the vicinity, increase in prices would be slow, steady and gradual, without any sudden spurts or jumps. On the other hand, in urban or semi-urban areas, where the development is faster, where the demand for land is high and where there is construction activity all around, the escalation in market price is at a much higher rate, as compared to rural areas. In some pockets in big cities, due to rapid development and high demand for land, the escalations in prices have touched even 30% to 50% or more per year, during the nineties.
14. On the other extreme, in remote rural areas where there was no chance of any development and hardly any buyers, the prices stagnated for years or rose marginally at a nominal rate of 1% or 2% per annum. There is thus a significant difference in increases in market value of lands in urban/semi-urban areas and increases in market value of lands in the rural areas. Therefore, if the increase in market value in urban/semi-urban areas is about 10% to 15% per annum, the corresponding increases in rural areas would at best be only around half of it, that is about 5% to 7.5% per annum. This rule of thumb refers to the general trend in the nineties, to be adopted in the absence of clear and specific evidence relating to increase in prices. Where there are special reasons for applying a higher rate of increase, or any specific evidence relating to the actual increase in prices, then the increase to be applied would depend upon the same.
15. Normally, recourse is taken to the mode of determining the market value by providing appropriate escalation over the proved market value of nearby lands in previous years (as evidenced by sale transactions or acquisition), where there is no evidence of any contemporaneous sale transactions or acquisitions of comparable lands in the neighbourhood. The said method is reasonably safe where the relied-on-sale transactions/acquisitions precedes the subject acquisition by only a few years, that is up to four to five years. Beyond that it may be unsafe, even if it relates to a neighbouring land. What may be a reliable standard if the gap is only a few years, may become unsafe and unreliable standard where the gap is larger. For example, for determining the market value of a land acquired in 1992, adopting the annual increase method with reference to a sale or acquisition in 1970 or 1980 may have many pitfalls. This is because, over the course of years, the `rate' of annual increase may itself undergo drastic change apart from the likelihood of occurrence of varying periods of stagnation in prices or sudden spurts in prices affecting the very standard of increase.
16. Much more unsafe is the recent trend to determine the market value of acquired lands with reference to future sale transactions or acquisitions. To illustrate, if the market value of a land acquired in 1992 has to be determined and if there are no sale transactions/acquisitions of 1991 or 1992 (prior to the date of preliminary notification), the statistics relating to sales/acquisitions in future, say of the years 1994-1995 or 1995-1996 are taken as the base price and the market value in 1992 is worked back by making deductions at the rate of 10% to 15% per annum. How far is this safe? One of the fundamental principles of valuation is that the transactions subsequent to the acquisition should be ignored for determining the market value of acquired lands, as the very acquisition and the consequential development would accelerate the overall development of the surrounding areas resulting in a sudden or steep spurt in the prices. Let us illustrate. Let us assume there was no development activity in a particular area. The appreciation in market price in such area would be slow and minimal. But if some lands in that area are acquired for a residential/commercial/industrial layout, there will be all round development and improvement in the infrastructure/ amenities/facilities in the next one or two years, as a result of which the surrounding lands will become more valuable. Even if there is no actual improvement in infrastructure, the potential and possibility of improvement on account of the proposed residential/commercial/ industrial layout will result in a higher rate of escalation in prices. As a result, if the annual increase in market value was around 10% per annum before the acquisition, the annual increase of market value of lands in the areas neighbouring the acquired land, will become much more, say 20% to 30%, or even more on account of the development/proposed development. Therefore, if the percentage to be added with reference to previous acquisitions/sale transactions is 10% per annum, the percentage to be deducted to arrive at a market value with reference to future acquisitions/sale transactions should not be 10% per annum, but much more. The percentage of standard increase becomes unreliable. Courts should therefore avoid determination of market value with reference to subsequent/future transactions. Even if it becomes inevitable, there should be greater caution in applying the prices fetched for transactions in future. Be that as it may.
17. In this case, the acquisition was in a rural area. There was no evidence of any out of ordinary developments or increases in prices in the area. We are of the view that providing an escalation of 7.5% per annum over the 1987 price under Ext.15, would be sufficient and appropriate to arrive at the market value of acquired lands.
Whether the increase should be at a cumulative rate or a flat rate?
18. The increase in market value is calculated with reference to the market value during the immediate preceding year. When market value is sought to be ascertained with reference to a transaction which took place some years before the acquisition, the method adopted is to calculate the year to year increase. As the percentage of increase is always with reference to the previous year's market value, the appropriate method is to calculate the increase cumulatively and not applying a flat rate. The difference between the two methods is shown by the following illustration (with reference to a 10% increase over a basic price of Rs.10/- per square metre):
Year By flat rate increase method By cumulative increase method 1987 (Base Year) 10.00 10.00 1988 10 + 1= 11.00 10.00 + 1.00 = 11.00 1989 11 + 1= 12.00 11.00 + 1.10= 12.10 1990 12 + 1= 13.00 12.10 + 1.21= 13.31 1991 13 + 1= 14.00 13.31 + 1.33 = 14.64 1992 14 + 1= 15.00 14.64 + 1.46 = 16.10
19. We may also point out that application of a flat rate will lead to anomalous results. This may be demonstrated with further reference to the above illustration. In regard to the sale transaction in 1987, where the price was Rs.10 per square metre, if the annual increase to be applied is a flat rate of 10%, the increase will be Rs.1 per annum during each of the five years 1988, 1989, 1990, 1991 and 1992. If the price increase is to be determined with reference to sale transaction of the year 1989 when the price was Rs.12 per square metre, the flat rate increase will be Rs.1.20 per annum, for the years 1990, 1991 and 1992. If the price increase is determined with reference to a sale transaction of the year 1990 when the price was Rs.13 per square metre, then the flat rate increase will be Rs.1.30 per annum for the years 1991 and 1992. It will thus be seen that even if the percentage of increase is constant, the application of a flat rate leads to different amounts being added depending upon the market value in the base year. On the other hand, the cumulative rate method will lead to consistency and more realistic results. Whether the base price is Rs.10 or Rs.12.10 or Rs.13.31, the increase will lead to the same result. The logical, practical and appropriate method is therefore to apply the increase cumulatively and not at a flat rate."
15. Similar view was taken by Hon'ble Supreme Court in Valliyammal Vs. Special Tahsildar (Land Acquisition) 2011(8) SCC 91. The judgment in the case of Oil and Natural Gas Corporation Limited (supra) and Valliyammal (supra) were followed by Hon'ble Supreme Court in its judgment dated 2.7.2013 in Civil Appeal No.4843-4940 of 2013 (Haryana State Industrial Development Corporation Ltd. Vs. Udal & others etc. etc.
16. Fair market value of the acquired land is required to be determined under Section 23 of the Act on the basis of the market rate of the adjacent lands similarly situated to the acquired lands prevailing on the date of acquisition or/and prior to acquisition but not subsequent to the date of acquisition. In appropriate cases, addition of 10% per annum escalation in the prices specified in the sale deeds (if filed and relied on) in relation to adjacent similarly situated lands for fixing the market value of the acquired land may be permitted.
17. Primarily, the increase in land prices depends on four factors (i) situation of the land (ii) nature of development in surrounding area (iii) availability of land for development in the area and (iv) the demand for land in the area.
18. In rural areas unless there is any prospect of development in the vicinity, increase in prices would be slow, steady and gradual, without any sudden spurts or jumps. On the other hand, in urban or semi-urban areas, where the development is faster, where the demand for land is high and where there is construction activity all around, the escalation in market price is at a much higher rate, as compared to rural areas. Where there are special reasons for applying a higher rate of increase, or any specific evidence relating to the actual increase in prices, then the increase to be applied would depend upon the same.
19. Normally, recourse is taken to the mode of determining the market value by providing appropriate escalation over the proved market value of nearby lands in previous years (as evidenced by sale transactions or acquisition), where there is no evidence of any contemporaneous sale transactions or acquisitions of comparable lands in the neighbourhood. The said method is reasonably safe where the relied-on-sale transactions/acquisitions precedes the subject acquisition by only a few years, that is up to four to five years. Beyond that it may be unsafe, even if it relates to a neighbouring land. This is because, over the course of years, the `rate' of annual increase may itself undergo drastic change apart from the likelihood of occurrence of varying periods of stagnation in prices or sudden spurts in prices affecting the very standard of increase.
20. In view of the above discussion, I do not find any manifest error of law in the impugned judgment whereby the market value of the acquired land has been determined on the basis of the fair market value determined in the acquisition made for the adjacent land acquired for U.P. Awas Vikas Parisahd, granting escalation in price @ 10% per annum. Therefore, all these First Appeals deserve to be dismissed.
21. Learned counsels for the parties now submit that there is some calculation error in the impugned judgment. Be that as it may, if the parties finds that there is some calculation error while computing price per sq. meter it is open for them to approach the court below for rectification, provided such mistake is apparent on record.
22. With the aforesaid observations, all the aforenoted appeals and cross objections are dismissed.
Order Date :- 3.12.2018/vkg