Madhya Pradesh High Court
M.P. Housing Board vs Mrs. Neera Kapoor And Ors. on 8 September, 2003
Equivalent citations: 2004(1)MPHT422
Author: Dipak Misra
Bench: Dipak Misra
JUDGMENT
Dipak Misra, J.:
1. In this appeal preferred under Section 54 of the Land Acquisition Act, 1894, (for brevity 'the Act') the appellant, M.P. Housing Board, Rewa, through its Executive Engineer, has called in question the acceptability and penetrability of the award passed by the Reference Court on 3-1-1993 in land acquisition case No. 67/91.
2. For the purpose of construction of the houses of the M.P. Housing Board (in short 'the Board') a notification under Section 4(1) read with Section 17(1) of the Act was issued on 1-7-1983 for 6.07 hectares of land situated at Dhekaha in Khasra No. 250. A notification under Section 6 of the Act was issued on 12-8-1993. In pursuance of the notification advance possession was taken on 15-2-1996. On receipt of the due notice the land owners putforth their claim and award was passed by Land Acquisition Officer on 7-8-1996 and he determined the valuation at the rate of Rs. 36,400/- per acre. A sum of Rs. 6,82,924/- was awarded by the Land Acquisition Officer which was received by the respondent Nos. 1 to 8 under protest on 12-9-1986. An application under Section 18 of the Act was filed for referring the matter to the Civil Court, and accordingly the concerned authority referred the matter which was dealt with by the learned Third Additional District Judge. It is pertinent to state here that total award for Rs. 9,11,938/- and in the reference application a claim of Rs. 15 per square foot was advanced on many grounds, namely, the area close to the Highway; the potential value of the lands has not been considered; the Board itself has allotted the land at the rate of Rs. 23 per sq. ft. and there are properties on certain land which has not been taken note of.
3. Before the Reference Court the land owners examined four witnesses and on behalf of the Board one witness was examined. That apart, the land owners brought certain sale deeds on record which were prior to the notification and some were after issue of notification. It was contended before the Reference Court that the market value has not been properly determined and it required enhancement. It was also contended that principles which are settled for determination of the market value has been totally ignored and brushed aside by the Land Acquisition Officer.
4. The Reference Court adverted to many a facet like the land in question was situated near the industrial area of Rewa town; that it is in proximity of the National Highway; that at the time of issue of the notification there was immense potentiality for the growth of the area; that the sale deeds of 1980-81 and 1982-83 clearly stipulated that the average price of the land per acre was Rs. 3,60,363/-; that the price per square foot has escalated; that the population of the town had increased; that the utility in praesenti has not been taken note of; that the future prospects pertaining to the use of the land has been allowed to take a back-sheet; that there has been continuous increase in the price of land sometimes at monthly and sometimes at six monthly intervals; that the oral evidence on record clearly showed with regard to the situation of the land and the sale price; that prior to the notification certain land had been sold on square foot basis; that in respect of certain land which had been acquired much earlier award has been passed and the Supreme Court in appeal had increased the rate; that the determination made in the case of Suresh Kumar which had travelled to the Supreme Court was almost at par with the case at hand factual matrix in a way being the same; and that Reference Court fixed the value at Rs. 1,96,020/- per acre and granted interest at 12% from 1-7-1983 till 12-2-1986 and solatium at the rate of 30%. The Reference Court also granted interest under Section 28 of the Act and it has awarded a sum of Rs. 50,000/- for a well situated on the acquired land.
5. Assailing the award Mr. A.D. Deoras, learned Counsel for the appellant has submitted that the Reference Court has not taken note of the condition of the land at the time of acquisition inasmuch as it was agricultural land; uneven and there was a deep 'nalah' and it was absolutely undeveloped. It is also putforth by him that only half of the land could be utilised for development but the same facet has not been adverted to by the learned Trial Judge. It is contended by Mr. Deoras that there is evidence on record that agricultural land at the time of acquisition had very less value and in 1980 it could only fetch 0.75 per sq. ft. Submission of Mr. Deoras that there is material evidence on record that sale price for 1981 was at 1.75 per sq. ft. The learned Counsel has also contended that certain agreements had been brought on record but the same did not ripened into sale deed, therefore, same could not have been construed as evidence. It is further putforth by the learned Counsel for the appellant that for determination of compensation of agricultural land small plots could not have formed the basis. It is also his submission that photo-copy of the sale-deeds had been pressed into service which were not admissible under Section 51 of the Act and further the vendors and purchasers were not examined to determine the genuineness of the sale deeds. Grant of compensation for the sale has also been seriously criticised. Mr. Deoras has also submitted that Reference Court has committed error by granting interest on the solatium.
6. Mr. R.N. Singh, learned Senior Counsel for the respondent sounding a contra note, has submitted that the acquired land is under the limits of the Municipal Corporation and is situated in close proximity from the bus stand area. It is urged that acquired land is 2 Kms. away from the Railway Station and is by the side of the National Highway. It is also putforth by him that no records had been produced by the Board to show that the acquired land was waste and barren land and no evidence was produced that there was a 'natah' on the acquired land. It is also urged by him that the certified copies of the sale deeds, Ex. P-1 to Ex. P-11 are available on record. It is urged by him that certain factors, namely, situation of the acquired land and proximity to the town, commercial, industrial, educational and other important purposes are to be taken into consideration; that the suitability of the acquired land for building be it residential, commercial and industrial is also to be taken note of. The proximity that of the highway, public roads and other developed area in the vicinity or closed proximity has also to be considered. It was also urged by him that there is no error on the grant of interest on the solatium. The learned Senior Counsel has further urged that if sale price as fixed by the Reference Court is seen from the perspect of prudent purchaser no error is noticeable.
7. It is relevant to state here that the award passed on 18-74991 was assailed by the Board in a writ petition forming the subject-matter of M.P. No. 4146/91 and the same was allowed vide order dated 7-8-1992 on the ground that the Board was not afforded an opportunity to lead the evidence. This Court remitted the matter to the Reference Court to decide it again and thereafter, the Reference Court passed fresh award after permitting the Board to lead evidence. It is pertinent to state here that the award of compensation awarded by the Reference Court on earlier occasion remained same except that on the first occasion Rs. 13,000/- was awarded towards the price of well but on the second occasion it was enhanced.
8. Before we appreciate the rival submissions raised at the Bar that how the Reference Court has scrutinised the oral evidence and appreciated the documentary evidence, it is apposite to notice certain decisions in the field.
9. In the case of Ahmedabad Municipal Corporation v. Shardahen, (1996) 8 SCC 93, the Apex Court expressed the view that the burden is always on the claimants to prove by adducing reliable evidence that the compensation offered by the Land Acquisition Officer is inadequate and the lands are capable of fetching higher market value. It is the duty of the Court to closely scrutinise the evidence, apply the test of prudent and willing purchaser, i.e., whether he would be willing to purchase in open and normal market conditions of the acquired lands and then determine just and adequate compensation.
10. In the case of Hookiyar Singh v. Special Land Acquisition Officer, (1996) 3 SCC 766, it was held that the Court must not indulge in the feats of imagination but, sit in the armchair of a prudent purchaser in open market and to put a question to itself whether as a prudent purchaser it would offer the same price in the open market as is to be determined ? This should be the acid test.
11. In this context it is worthwhile to note that in the case of State of U.P. v. Ram Kumari Devi, (1996) 8 SCC 577, the Apex Court ruled that when 13.75 acres of lands was offered for sale in an open market, no prudent man would have credulity to purchase that land on square foot basis.
12. In the case of Gujrat Industrial Development Corporation v. Narottambhai Morarbhai, (1996) 11 SCC 159, the Apex Court observed that no prudent purchaser would purchase large extent of land on the basis of sale of a small extent of land in the open market. The crucial test the Court should always adopt in determining market value in the matter of compulsory acquisition would be to eschew figment of imagination and consider the price likely to be offered by the willing vendee.
13. In the case of G. Narayan Rao v. Land Acquisition Officer, (1996) 10 SCC 607, it was ruled that it must be established, as a fact, that the potential purpose does exist on the date of notification, the prevailing conditions in the market, the existence of the construction of building activities in the neighbourhood and that other lands in the neighbourhood possessed similar conditions.
14. In the case of Kanwar Singh v. Union of India, (1998) 8 SCC 136, it has been held that the amount of compensation for the land acquired depends on the market value of land on the date immediately before the notification under Section 4 of the Act or when same land is acquired and offer of compensation is made through an award. The market value has to be determined on the basis of evidence produced before the Court. It was further held that the consideration in terms of price received for land under bona fide transactions on the date or preceding the date of notification issued under Section 4 of the Act generally shows the market value of the acquired land and the market value of the acquired land to be assessed in terms of those transactions. It is also noteworthy to state here that in the case of Hansali Walichand v. State of Maharashtra, (1998) 2 SCC 388, Their Lordships held that the land having future potential on account of its location can not be ignored and realised potential is not the sole pivotal factor.
15. In this regard it is noteworthy to refer to the decision rendered in the case of Land Acquisition Officer, Revenue Divisional Officer v. L. Kamalamma, (1998) 2 SCC 385, where in it has been held by Their Lordships that when no sales of comparable land were available where large chunks of land had been sold, even land transactions in respect of small extent of land could be taken note of as indicating the price that it may fetch in respect of large tracts of land by making appropriate deductions such as for development of the land by providing enough space for roads, sewers, drains, expenses involved in formation of a layout, lump sum payment as also the waiting period required for selling the sites that would be formed.
16. In this case we may also refer to the decision rendered in the case of Union of India v. Mangat (Dead) by L.Rs. and Ors., (2000) 10 SCC 609, wherein Their Lordships held in Para 8 as under:--
"8. Even if one was to disregard the quality of the land, i.e., irrigated, semi-irrigated or barren, one can not be oblivious of the fact that the market value of land which abuts on the national highway would be much more than the land which is away from it. A price of the land which is landlocked and which is farther away from the national highway can not be the same as that which abuts on the national highway. The formula which had been applied by the High Court, however, seems to indicate that the price of the entire land irrespective of the location of different parcels of land is the same. The formula which was applied by the learned Single Judge of the High Court is obviously incorrect."
17. In this regard we may profitably refer to the decision rendered in the case of Kasturi v. State of Haryana, (2003) 1 SCC 354, wherein it was held when there is difference between a developed area and an area having potential value though yet to be developed cut 20% towards development charges as against the normal 1/3rd, from the amount of compensation was treated to be justified in the facts and circumstances of the case.
18. In this regard it is worth referring to the decision rendered in the case of Land Acquisition Officer v. B. Vijender Reddy and Ors., (2001) 10 SCC 669. In the aforesaid case a two Judge Bench of the Apex Court held as under:--
"13....... It is true, in the fixation of rate of compensation under the Land Acquisition Act, there is always some element of guesswork. But that has to be based on some foundation. It must spring from the totality of evidence, the pattern of rate, the pattern of escalation and escalation of price in the years preceding and succeeding Section 4 notification etc. In other words, the guesswork could reasonably be inferable from it. It is always possible to assess the rate within this realm. In the present case, we find there are three exemplars, i.e., Exhibits A-l and A-2 which are three years preceding the date of notification and Exhibit A-3 which is of the same point of time when Section 4 notification was issued."
19. Keeping in view the aforesaid pronouncement of law we have to scrutinise the correctness of the award in question. The Reference Court has taken note of the sale deeds that have been brought on record; the situation of the land; and the potentiality of the land at the time of notification. It has also been brought on record in evidence in what amount the Board has sold the land after developing the same. As is perceptible the rate was Rs. 23 per sq. ft. It is also noticeable that the Reference Court has noticed that in 1981 the square foot was Rs. 3.60, in 1982 Rs. 4/- and in 1983 Rs. 4.50 and thereafter Rs. 6/-, Rs. 8/- and Rs. 10/-. Five sale deeds, that have been marked as exhibits are prior to the date of notification and three sale deeds are after the notification. As has been held by the Apex Court the sale deeds are indicators towards the price of the land. As is seen the sale deeds of 1982 clearly show that land price of square foot was Rs. 4/- to Rs. 4.25. True it is, a big chunck of land was acquired and in this case the price fixed for square foot can not be taken into consideration. It is submitted by Mr. Dcoras that the sale deeds can not be taken into consideration as vendor and vendee have not been examined, In this context we may profitably refer to the decision rendered in the case of State of Haryana v. Ram Singh, AIR 2001 SC 2532, wherein a two Judge Bench of the Apex Court in Paras 5 and 6 held as under:--
"5. Counsel for the State was right when he submitted that the High Court erred in rejecting Exhibits R-2 and R-3 as inadmissible only on the ground that the parties to the documents had not been examined by the State. It is not the law that a certified copy of a registered agreement for sale is inadmissible in evidence unless the parties to the document are examined to prove it. That would be contrary to what Section 77 read with Sections 74(2) and 76 of the Evidence Act, 1872 and more specifically Section 51A of the Land Acquisition Act provide. As far as the provisions of the Evidence Act are concerned, a certified copy of the registered sale deed is admissible in evidence and does not need to be proved by calling a witness. [See Ramappa v. Bojjappa, AIR 1963 SC 1633,1637].
6. Section 51A of the Act is to the same effect. In Land Acquisition Officer and Ma ndal Revenue Officer v. V. Narasaiah (2001 AIR SCW 867 : AIR 2001 SC 1117) (supra), it was held that by virtue of Section 51A, a certified copy of a document registered under the Registration Act, 1908 including a copy under Section 57 of the Act may be accepted as evidence of the transaction recorded in such documents. It is open to the Court to accept the certified copy as reliable evidence and without examining parties to the documents. This does not however, preclude the Court from rejecting the transaction itself as being malafide or sham provided such a challenge is laid before the Court."
20. In view of the aforesaid, we are of the considered opinion, the Reference Court was not precluded to take note of the sale deeds. We have also perused the oral evidence brought on record. It is quite manifest that the land in question was proximately situated to the commercial and industrial areas. The evidence in regard to the suitability of the land for constructing the buildings has also been brought on record. It is also evident that they were in proximity to the national highway and public roads. True it is, it is putforth by Mr. Deoras that at that lime there was no railway station but it is perceivable that national highways were in existence. It has also come in evidence that lands used to be converted into small plots and sold by land owners. It has also been deposed by P.W. 1 that the land is situated in quite proximity to the road and there arc houses nearby. Thus, there is ample evidence with regard to the situation of the land. In this case what we notice is that the Reference Court has fixed the price at Rs. 1,96,600/- per acre. We are conscious that the price adopted on square foot basis can not be the determining factor but indubitably it can be an indicator. In the present case the Reference Court has fixed the price on square foot basis at Rs. 4.15 and determined the price at Rs. 1.96 lacs per acre.
21. Ordinarily we would have taken recourse to other methods of determination by fixing the rate per square yard but we think in the case at hand the best solution should be to ignore the price fixed on square foot basis and to fix the price on acreage basis. As has been stated earlier while taking into consideration the principles relating to price fixation the Court has to also apply the facet of guesswork. Regard being had to the evidence brought on record and taking note of the fact the amount at which the Board sold the property, we think it would be appropriate to determine the price at Rs. 1,40,000/- per acre.
22. The next aspect that arises for consideration is with regard to the valuation of well. It is submitted by Mr. Deoras, learned Counsel for the appellant that the valuation of the well has been increased after the remand though the same was not challenged. Taking note of the aforesaid submission and the material on record we arc of the considered opinion, the valuation of the well at Rs. 50,000/- is not correct and the reasons given by the Reference Court in Para 29 are not acceptable. Accordingly, we feel the valuation should be treated to be Rs. 30,000/- as has been done on the earlier occasion.
23. The next aspect that requires to be dealt with is grant of solatium and interest under Section 28A of the Act. It is noticeable that the Reference Court has granted solatium. There is no error in that. We would only like to add on what the same interest are to be paid. In this regard we may profitably refer to the decision rendered in the case of Sunder v. Union of India, (2001) 7 SCC 211, wherein it has been held as under:--
"26. We think it useful to quote the reasoning advanced by the Chief Justice S.S. Sandhawalia of the Division Bench of the Punjab and Haryana High Court in State of Haryana v. Kailash-wati:
"Once it is held as it inevitably must be that the solatium provided for under Section 23(2) of the Act forms an integral and statutory part of the compensation awarded to a land owner, then from the plain terms of Section 28 of the Act, it would be evident that the interest is payable on the compensation awarded and not merely on the market value of the land. Indeed the language of Section 28 does not even remotely refer to market value alone and in terms talks of compensation or the sum equivalent thereto. The interest awardable under Section 28 therefore, would include within its ambit both the market value and the statutory solatium. It would be thus evident that the provisions of Section 28 in terms warrant and authorise the grant of interest on solatium as well."
27. In our view the aforesaid statement of law is in accord with the sound principles of interpretation. Hence the person entitled to the compensation awarded is also entitled to get interest on the aggregate amount including solatium."
24. In view of the aforesaid, the claimant would be entitled to interest at the rate of 9% which is payable on solatium as well as the amount awarded under the other provisions of the Act. We may hasten to add, we have granted the aforesaid relief to the claimants as they would be entitled to the aforesaid as it is statutorily provided.
25. The appeal is allowed in the above terms without any order as to costs.