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"5. ....Determination of market value on square foot basis would be arbitrary and is an irrational principle of law. It is now settled by a series of judgments of this Court that determination of the compensation on square feet basis is a wrong principle of law, particularly when large extents of lands are sought tobe acquired for public purpose. Therefore, the High Court has proceeded on a wrong premises to determine the compensation on the basis of square foot."

18. The Honourable Supreme Court in the decision reported in (K.S. Shivadevamma and others vs. Assistant Commissioner and Land Acquisition Officer and another) 1996 2 SCC 62 held that when the lands are situated in a developing area, but no development has taken place as on the notification under Section 4 (1) of the Act in the acquired lands or in that area, even though the land possessed of the potential value for building purpose, but not capable of putting it into immediarte use for building purpose, definitely, deductions for development charges depends upon the development needed in each case. In that case, the Honourable Supreme Court categorically held that deduction of 53% under the building Rules and further deduction towards development charges at 33 = % ordered by the High Court are found to be correct. In Para No.8 and 10 of the said judgment, it was held as follows:-

20. A Division Bench of this Court in the decision reported in (Special Tahsildar, Neighbourhood Scheme, Erode, Erode District vs. Jaganathan Gounder and another) 2009 5 MLJ 2, after referring to various decisions of the Honourable Supreme Court as well as this Honourable Court held that if the value of the acquired lands has been arrived at without giving any deduction towards development charges, 40% of deduction on the value of the acquired lands can be given. Further, if the value has been arrived at based on the smaller extent of lands, a further deduction of 20% can be given, thus, totalling 60% deduction can be given. In Para Nos. 27, 28, 35, 36, 37 and 38, it was held as follows:-

Deduction Towards Development charges:

28. While fixing the market value, it is permissible for the Land Acquisition Officer to give necessary deduction towards development charges. In such cases, the Land Acquisition Officer must record reasons about the disadvantage of the land acquired and the purpose for which the land wassought to be acquired as well as the percentage of land necessary for providing developments like provision of roads, electricity, water and sewerage and other facilities. The extent of deduction cannot be put in a straitjacket formula and it varies from case to case. The Hon'ble Supreme Court had time and again indicated the factors to be considered by the Land Acquisition Officer for making deduction towards development charges as well as percentage of deduction. Such deduction is also not automatic unless there is a factual finding that deduction was absolutely necessary in thefacts of the case by taking into consideration the ground situation. In case the property has already been developed, there would be no requirement of deduction towards development.

30. As stated above, the land in question is only an agricultural land and it has not been converted into a house site. The court below has not given any deduction at all towards development charges. The value fixed by the court below, without giving any deduction, is not legally sustainable. As per the decisions of the Honourable Supreme Court as well as this Court, discussed in the earlier paragraphs, during conversion of the lands into a house site, the Government has to incur expenditure for providing various amenities for which deduction has to be necessarily given and the Honourable Supreme Court held that 53% deduction and another 33% towards development charges. Further, as per the decision of the Division Bench of this Court reported in (Special Tahsildar, Neighbourhood Scheme, Erode, Erode District vs. Jaganathan Gounder and another) 2009 5 MLJ 2 if the value of the lands is arrived at based on smaller extent of land, further deduction of 20% can be given. Considering the facts and circumstance of the present case, inasmuch as the area has not been developed even as per the evidence of the claimants, we feel that 70% deduction can be given. Therefore, taking into consideration of the above said decisions if 50% deduction is given towards development charges and another 20% deduction is given for having relied on the smaller extent of lands, totalling 70%, the value of the acquired lands can be fixed at Rs.4.90 per sq.ft., rounding it off to Rs.5/- per square feet.