Supreme Court - Daily Orders
State Of Haryana And Ors Etc Etc vs Chetin Kaur And Anr. Etc. Etc. on 26 October, 2017
Bench: Arun Mishra, Mohan M. Shantanagoudar
1
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL No(s). OF 2017
(Arising out of SLP(C) Nos.2542-2553 of 2017
STATE OF HARYANA AND ORS ETC. ETC. ..APPELLANTS(S)
VERSUS
CHETIN KAUR AND ANR. ETC. ETC. ..RESPONDENT(S)
O R D E R
1. Leave granted.
2. Heard learned counsel for the parties.
3. For determination of compensation in the evidence the various sale deeds were placed on record in the instant case. The sale deeds have not been considered either by the reference court or by the High Court.
4. A chart of the sale deeds on record has been filed before us by the learned counsel appearing for the State evincing sale of land in village Shergarh and Dabwali of the year 1994-2006. Certain sale deeds are also of Signature Not Verified 2004-2006 in close proximity to Section 4 notification.
Digitally signed by ASHWANI KUMAR Date: 2017.11.02 15:45:05 IST Reason:Sale deeds after the notification issued under Section 4 of the Land Acquisition Act, 1894 ( in short 'the Act') 2 have to be excluded and the sale deeds which are in close proximity of the time of issuance of Notification under Section 4 of the Act were required to be considered. The method of granting compensation on the basis of cumulative increase as done was not permissible in the facts of the case, in view of the sale deeds. The method of working out compensation without considering evidence on record and without making any deduction for the smallness of the area and development could not be said to be justifiable. The award that had been relied upon price was determined as it prevailed in 1994 that would not be safe criteria to assess compensation in this case and more so in view of the exemplar evidence placed on record that ought to have been considered in the instant case thereafter the compensation ought to have been worked out duly considering the cut to made as laid down by this Court in Major General Kapil Mehra & Ors. vs. Union of India & Anr.[(2015) 2 SCC 262] thus:
“33. In Haryana State Agricultural Market Board vs. Krishan Kumar, (2011) 15 SCC 297, it was held as under:
“10. It is now well settled that if the value of small developed plots should be the basis, appropriate deductions will have to be made therefrom towards the area to be used for roads, drains, and common facilities like park, open space, etc. Thereafter, further deduction will have to be made towards the cost of development, that is, the cost of leveling the land, cost of laying roads and 3 drains, and the cost of drawing electrical, water and sewer lines.”
35. Reiterating the rule of one-third deduction towards development, in Sabhia Mohammed Yusuf Abdul Hamid Mulla vs. Special Land Acquisition Officer, (2012) 7 SCC 595, this Court in paragraph 19 held as under:-
“19. In fixing the market value of the acquired land, which is undeveloped or underdeveloped, the courts have generally approved deduction of 1/3rd of the market value towards development cost except when no development is required to be made for implementation of the public purpose for which land in acquired. In Kasturi vs. State of Haryana (2003) 1 SCC 354) the Court held: (SCC pp. 359-60, para 7) "7… It is well settled that in respect of agricultural land or undeveloped land which has potential value for housing or commercial purposes, normally 1/3rd amount of compensation has to be deducted out of the amount of compensation payable on the acquired land subject to certain variations depending on its nature, location, extent of expenditure involved for development and the area required for road and other civic amenities to develop the land so as to make the plots for residential or commercial purposes. A land may be plain or uneven, the soil of the land may be soft or hard bearing on the foundation for the purpose of making construction; may be the land is situated in the midst of a developed area all around but that land may have a hillock or may be low-lying or may be having deep ditches. So the amount of expenses that may be incurred in developing the area also varies. A claimant who claims that his land is fully developed and nothing more is required to be done for developmental purposes must show on the basis of evidence that it is such a land and it is so located. In the absence of such evidence, merely saying that the area adjoining his land is a developed area, is not enough, particularly when the extent of the acquired land is large and even if a small portion of the land is abutting the main road in the developed area, does not give the land the character or a developed area. In 84 acres of land acquired even if one portion on one side abuts the main road, the remaining large area where planned development is 4 required, needs laying of internal roads, drainage, sewer, water, electricity lines, providing civic amenities, etc. However, in cases of some land where there are certain advantages by virtue of the developed area around, it may help in reducing the percentage of cut to be applied, as the developmental charges required may be less on that account. There may be various factual factors which may have to be taken into consideration while applying the cut in payment of compensation towards developmental charges, may be in some cases it is more than 1/3rd and in some cases less than 1/3rd. It must be remembered that there is a difference between a developed area and an area having potential value, which is yet to be developed. The fact that an area is developed or adjacent to a developed area will not ipso facto make every land situated in the area also developed to be valued as a building site or plot, particularly when vast tracts are acquired, as in this case, for development purpose."
The rule of 1/3rd deduction was reiterated in Tejumal Bhojwani v. State of U.P. ((2003)10 SCC 525, V. Hanumantha Reddy v. Land Acquisition Officer, (2003) 12 SCC 642, H.P. Housing Board v. Bharat S. Negi (2004) 2 SCC 184 and Kiran Tandon v. Allahabad Development Authority (2004)10 SCC 745”
36. While determining the market value of the acquired land, normally one-third deduction i.e. 33 1/3% towards development charges is allowed. One-third deduction towards development was allowed in Tehsildar(L.A.) vs. A. Mangala Gowri, (1991) 4 SCC 218; Gulzara Singh vs. State of Punjab, (1993) 4 SCC 245;
Santosh Kumari vs. State of Haryana, (1996) 10 SCC 631; Revenue Divisional Officer & L.A.O. vs. Sk. Azam Saheb, (2009) 4 SCC 395; A.P. Housing Board vs. K. Manohar Reddy, (2010)12 SCC 707; Ashrafi vs. State of Haryana, (2013) 5 SCC 527 and Kashmir Singh vs. State of Haryana, (2014) 2 SCC 165.
37. Depending on nature and location of the acquired land, extent of land required to be set apart and expenses involved for development, 30% to 50% deduction towards development was allowed in Haryana State Agricultural Market Board vs. Krishan Kumar (2011) 15 SCC 297; Director, Land Acquisition vs. Malla Atchinaidua 2006 (12) SCC 87; Mummidi Apparao vs. Nagarjuna Fertilizers & Chemicals Ltd., AIR 2009 SC 1506; and Lal Chand 5 vs. Union of India (2009) 15 SCC 769.
38. In few other cases, deduction of more than 50% was upheld. In the facts and circumstances of the case in Basavva v. Land Acquisition Officer, (1996) 9 SCC 640, this Court upheld the deduction of 65%. In Kanta Devi vs. State of Haryana (2008) 15 SCC 201, deduction of 60% towards development charges was held to be legal. This Court in Subh Ram vs. State of Haryana , (2010) 1 SCC 444, held that deduction of 67% amount was not improper. Similarly, in Chandrasekhar vs. Land Acquisition Officer, (2012) 1 SCC 390, deduction of 70% was upheld.
39. We have referred to various decisions of this Court on deduction towards development to stress upon the point that deduction towards development depends upon the nature and location of the acquired land. The deduction includes components of land required to be set apart under the building rules for roads, sewage, electricity, parks, and other common facilities and also deduction towards development charges like laying of roads, construction of sewerage."
5. This Court in the General Manager, Oil and Natural Gas Corpn. Ltd. V. Rameshbhai Jivanbhai Patel & Anr.
(2008) 14 SCC 745 has observed that mode of determining the market value by providing appropriate escalation over the market value is permissible when there is no evidence of any contemporaneous sale transaction or acquisition of comparable lands in the neighbourhood. The sale transaction/acquisition precedes by only a few years that is up to 4 or 5 years. Beyond that, it may be unsafe to act upon it and it is unsafe and unreliable standard where the gap is larger. To determine the market value in the year 1992 on a transaction of 1970 or 1980 may have 6 many pitfalls. The relevant portion is extracted hereunder:
"12. 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 precede the subject acquisition by only a few years, that is upto 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.
13. 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 1994-95 or 1995-96 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 7 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.”
6. This Court in Lal Chand v. Union of India & Anr.
(2009) 15 SCC 769 has relied upon the aforesaid decision in O.N.G.C.’s case and observed thus:
“18. The appellants contend that some lands in Rithala were acquired under Section 4(1) notification dated 24.10.1961 for the planned development of Delhi and compensation was awarded at the rate of Rs. 7000 per bigha. Their contention is that as the present acquisition is in the year 1981, the market value of the acquired land should be determined with reference to the market value determined for the 1961 acquisition by providing an appropriate increase at the cumulative/ compounded rate of 12% per annum.
19. … Even if the relied upon transaction is only two to three years prior to the acquisition, court should, before adopting a standard escalation, satisfy that there were no adverse circumstances. For example, if the acquisition is of this year 2009, it may not be possible to determine the market value, based on the 2007 or 2008 prices, by providing an increase of 12% or 15% per year, as the newspaper reports disclose that the price of immovable properties in most areas of the country came down by more than 40% to 50% from the 2007 rates. Caution is therefore necessary before increasing the price with reference to the old transactions. Be that as it may. It is clear that the award made in regard to a 1961 acquisition will not be of any use for determining the market value for a 1981 acquisition.
36. The learned Counsel for DDA contended that market value determined by the High Court required to be reduced with 8 reference to the market value of the acquired lands in the neighbouring village. He relied upon the decision of this Court in Union of India v. Ram Phool : 2003 (10) SCC 167, which related to acquisition of 5484 bighas of land in revenue village Poothkalan on the outskirts of Delhi, in regard to which the preliminary notification was issued on 11.12.1981. The reference court had, after referring to several sale transactions, determined the market value as Rs. 15,700/- per bigha in one case and Rs. 18,500/- per bigha in another case. On appeal by the claimants, the High Court excluded several sale transactions relied upon by the reference court as not inspiring confidence, and on the basis of a solitary transaction dated 10.9.1981 in regard to a small area of one bigha, increased the market value to Rs. 30,000/- per bigha. This Court held that the High Court erred in relying upon a single sale deed relating to a small extent of one bigha to determine the market value of a large extent of 5484 bighas. It further held that if that sale deed was excluded, there was no other evidence to support the increase in compensation made by the High Court. Consequently, this Court set aside the increase awarded by the High Court and restored the market value determined by the reference court. The learned Counsel for DDA submitted that a rate in that range (Rs. 15700 to Rs. 18500 per bigha) should therefore be adopted for the Rithala lands also. But that decision relating to Poothkalan is not of any assistance with reference to the Rithala acquisitions for the following reasons:
(i) It is now well settled that sale transactions or awards relating to neighbouring village will not be relied on when acceptable evidence by way of contemporaneous sale transactions or awards are available in regard to the very village where the acquisition took place. (Where there are no contemporaneous sale deeds or awards relating to the same village, then the sale transactions or awards of the same period relating to the neighbouring village can be considered provided there is evidence to show that the acquired lands and the lands covered by the exemplar deeds of the neighbouring village are similarly situated).
(ii) The decision in Ram Phool itself lays down as follows:
`Contemporaneous award no doubt is a useful guide for every court to determine the market value but that award must be taken into evidence in accordance with law by giving an opportunity to the other side for rebutting the same and that has not been done in the case on hand.' In this case while the learned Counsel for respondents contended that the lands at Rithala and Poothkalan were similar, the learned Counsel for the appellants submitted that the acquired lands in Rithala were far more valuable than the lands in Poothkalan and that Rithala was nearer to the city when compared to Poothkalan. Neither stand 9 is supported by any evidence or material on record. In the absence of any evidence, we cannot assume that acquired lands in Rithala and lands acquired in Poothkalan were similarly situated.
(iii) In Ram Phool, this Court set aside the decision of the High Court and restored the award of reference court, not because it came to the conclusion that the market value was only Rs. 15,700/-/Rs.18,500/- as decided by the reference court, but because the only piece of evidence that was relied on by the High Court to fix the market value of Rs. 30,000/- was found to be not reliable and no other evidence was available. Therefore, decision of this Court in Ram Phool was not a positive determination of market value of Poothkalan lands, but the rejection of a determination of a higher value by High Court for want of acceptable evidence.”
7. In Subh Ram & Ors. v. Haryana State and Anr. (2010) 1 SCC 444 with respect to the relevancy of other acquisition in the same village the court has to apply the mind as to whether the land is similar or not even if there is a difference of only 1 or 2 years. This Court has laid down thus:
“14. Learned Counsel for the appellants lastly contended that having regard to two judgments of Punjab & Haryana High Court relating to acquisition in the same village in Azad Singh v. State of Haryana and Anr. RFA No. 2 of 1991 decided on 30.9.1997 and Kabul Singh and Ors. v. Haryana State and Anr.
RFA No. 556 of 1994 decided on 13.5.1999 the compensation to be awarded should not be less than Rs. 68/- (plus 25%) per sq.yd. In both cases Rs. 68/- per sq. yard was awarded as compensation for acquisitions of land in village Jharsa in the years 1982 and 1983. It was also submitted that as the subject acquisition was two years later in 1984, at least 25% should be added to Rs. 68/- per sq.yd. But the map of the area produced by the appellants show that the lands which are the subject matter of those two decisions are more advantageously situated as they adjoin National Highway No. 8 and are next to well developed areas (like Hidayatpur Cantonment/ etc.) whereas the acquired lands are farther away from National Highway No. 8 and any developed area. Hence, the said decisions, though relating to Jharsa village, are not of any assistance.” 10
8. This Court again in Special Land Acquisition Officer v. Karigowda & Ors. (2010) 5 SCC 708 has laid down that every case has to be examined on its own facts and courts are expected to scrutinize the evidence led by the parties in such proceedings.
“21. We may notice that Part III provides for procedure and rights of the claimants to receive compensation for acquisition of their land and also states various legal remedies which are available to them under the scheme of the Act. Under Section 18 of the Act, the Reference Court determines the quantum of compensation payable to the claimants. Section 23 provides guidelines, which would be taken into consideration by the court of competent jurisdiction while determining the compensation to be awarded for the acquired land. Section 24 of the Act is a negative provision and states what should not be considered by the court while determining the compensation. In other words, Sections 23 and 24 of the Act provide a complete scheme which can safely be termed as statutory guidelines and factors which are to be considered or not to be considered by the Court while determining the market value of the acquired land. These provisions provide a limitation within which the court has to exercise its judicial discretion while ensuring that the claimants get a fair market value of the acquired land with statutory and permissible benefits. Keeping in view the scheme of the Act and the interpretation which these provisions have received in the past, it is difficult even to comprehend that there is possibility of providing any straitjacket formula which can be treated as panacea to resolve all controversies uniformly, in relation to determination of the value of the acquired land. This essentially must depend upon the facts and circumstances of each case. It is settled principle of law that, the onus to prove entitlement to receive higher compensation is upon the claimants. In the case of Basant Kumar and Ors. v. Union of India and Ors. (1996) 11 SCC 542 this Court held that the claimants are expected to lead cogent and proper evidence in support of their claim. Onus primarily is on the claimant, which they can discharge while placing and proving on record sale instances and/or such other evidences as they deem proper, keeping in mind the method of computation for awarding of compensation which they rely upon. In this very case, this Court stated the principles of awarding compensation and placed the matter beyond 11 ambiguity, while also capsulating the factors regulating the discretion of the Court while awarding the compensation. This principle was reiterated by this Court even in the case of Gafar v. Moradabad Development Authority (2007) 7 SCC 614 and the Court held as under:
As held by this Court in various decisions, the burden is on the claimants to establish that the amounts awarded to them by the Land Acquisition Officer are inadequate and that they are entitled to more. That burden had to be discharged by the claimants and only if the initial burden in that behalf was discharged, the burden shifted to the State to justify the award. Thus, the onus being primarily upon the claimants, they are expected to lead evidence to revert the same, if they so desire. In other words, it cannot be said that there is no onus whatsoever upon the State in such reference proceedings. The Court cannot lose sight of the facts and clear position of documents, that obligation to pay fair compensation is on the State in its absolute terms. Every case has to be examined on its own facts and the Courts are expected to scrutinize the evidence led by the parties in such proceedings.”
9. In view of the aforesaid, we set aside the judgment and order passed by the High Court and remit the first appeals to the High Court. Let the High Court re-hear the matter and decide the case in accordance with law afresh.
10. The amount that has been deposited be kept in the fixed deposit to be disbursed after the appeals are decided by the High Court.
11. We set aside the judgment and order of the High Court and remit the matter to it to decide the appeals as expeditiously as possible. Accordingly, the appeals are 12 allowed to the aforesaid extent.
................J. (ARUN MISHRA) ................J. (MOHAN M. SHANTANAGOUDAR) NEW DELHI;
OCTOBER 26, 2017
13
ITEM NO.11 COURT NO.10 SECTION IV-B
S U P R E M E C O U R T O F I N D I A
RECORD OF PROCEEDINGS
Petition(s) for Special Leave to Appeal (C) No(s). 2542-2553/2017
(Arising out of impugned final judgment and order dated 21-04-2016 in RFA No. 5158-5162/2008, 5178/2008, 4773/2008, 4774/2008 1938/2009 , 1939/2009 , 1940/2009 and in RFA No. 3836/2009 passed by the High Court Of Punjab & Haryana At Chandigarh) STATE OF HARYANA AND ORS ETC ETC Petitioner(s) VERSUS CHETIN KAUR AND ANR. ETC. ETC. Respondent(s) Date : 26-10-2017 These petitions were called on for hearing today.
CORAM :
HON'BLE MR. JUSTICE ARUN MISHRA HON'BLE MR. JUSTICE MOHAN M. SHANTANAGOUDAR For Petitioner(s) Mr. Samar Vijay Singh, AOR Mr. Abhinash Jain, Adv.
For Respondent(s) Mr. Devendra Singh, AOR Mr. Rajiv Shankar Dvivedi, AOR Ms. Swati Agrawal, Adv.
Mr. Dhruv Sheoran, Adv.
Mr. Garima Bajaj, AOR Mr. Anupam Sharma, Adv.
Mr. Vishnu B. Saharya, Adv.
Mr. Viresh B. Saharya, Adv.
M/s. Saharya & Co., AOR UPON hearing the counsel the Court made the following O R D E R Leave granted.
The appeals are allowed to the extent indicated in terms of the signed order.14
Pending application, if any shall stand disposed of.
(NEELAM GULATI) (TAPAN KUMAR CHAKRABORTY)
COURT MASTER (SH) BRANCH OFFICER
(signed order is placed on the file)