(Prayer: First Appeals have been filed under Section 54 of the Land Acquisition Act against the judgment and decree dated 29.07.2013 passed in L.A.O.P.Nos.112, 114, 115, 116 & 117 of 2013 respectively on the file of the Special Subordinate Court, Arakkonam.)
1. A.S.Nos.372 to 376 of 2014 are directed against the judgment and decree dated 29.07.2013 passed in L.A.O.P.Nos.112, 114, 115, 116 & 117 of 2013 respectively on the file of the Special Subordinate Court, Arakkonam.
2. Shorn of unnecessary details, it is found that the lands belonging to the claimants had been acquired for the purpose of providing house sites to Adi Dravidars and accordingly, the notification under Section 4(1) of the Land Acquisition Act had come to be published on 25.05.1988 and after following the other procedures contemplated under the Act and after holding the enquiry, it is seen that the land Acquisition Officer had fixed the market Value of the acquired lands at the rate of Rs.70/- per cent and accordingly, determined the compensation payable to the claimants with reference to the lands acquired from them. The claimants having raised the resistance to the value fixed by the Land Acquisition Officer and consequently, the reference had been made before the competent Court for fixing the reasonable and just compensation under Section 18 of the Land Acquisition Act.
3. The referral Court, based on the materials placed on record by the respective parties, determined that the value fixed by the Land Acquisition Officer at Rs.70/- per cent is grossly low and proceeded to hold that the market value of the acquired land is Rs.300/- per cent and accordingly, determined the compensation payable to the claimants. Aggrieved over the same, the present first appeals had been preferred by the appellant.
4. Considering the scope of the controversy between the parties lying in a narrow compass, it is found that the following points arise mainly for determination in the appeals:
“(1).Whether the compensation fixed by the referral Court is reasonable and just?
(2).To what relief the claimants are entitled to?
(3).To what relief the appellant is entitled to? “
5. The lands belonging to the claimants had been acquired for providing house sites to Adi Dravidars and the notification under Section 4(1) of the Act had come to be published on 25.05.1988 and after observing the other formalities contemplated under the Act and holding the enquiry, it is found that the Land Acquisition Officer had fixed the market value of the acquired lands at Rs.70/- per cent. For arriving at the abovesaid determination, it is found that the Land Acquisition Officer had, after taking into consideration the various sale transactions effected during the preceding three years prior to the date of notification, deemed it fit to rely upon the sale deed in Sl.No.27 i.e. Document No.420/1996 pertaining to 0.10 Acres sold for Rs.700/- and further determined that the land covered under the abovesaid sale deed is identical to the acquired lands in terms of the soil conditions etc., on that basis proceeded to fix the value of the acquired lands at Rs.70/- per cent and accordingly, determined the compensation payable to the claimants.
6. The claimants challenged the compensation fixed by the Land Acquisition Officer and resultantly, the reference had been made to the competent Court for determining the just and reasonable compensation. Before the Referral Court, the claimants had put forth the case that the acquired lands are dry lands and the claimants had been raising vegetables and cash crops therein and earning Rs.25,000/- per year and according to them, adopting the multiplier of 20 years of the income, due compensation should have been paid to the claimants and further, it is put forth by them that the acquired lands are adjacent to the road and suitable for housing and industrial purpose and also put forth that the weavers town viz., Guruvarajapet is about half a kilo meter from the acquired lands and the same is suitable for housing and industrial purpose and there are about 10,000 power looms at Guruvarajapet village and the said village is extending towards the acquired village and there is one Higher Secondary School, Library in the village and there are frequent town buses from Arakkonam and Tiruttani road to Nandivedunthangal village and the house sites are sold for Rs.1,00,000/- per cent adjoining the Guruvarajapet Village and the value of the acquired lands during the relevant time is Rs.20,000/- per cent and therefore, prayed for fixing the market value at Rs.20,000/- per cent and determine the compensation accordingly.
7. The land acquisition officer reiterated his stand and contended that the compensation determined by him by fixing the land value at Rs.70/- is just and reasonable and no interference is called for and prayed for the dismissal of the reference.
8. Considering the materials placed on record, as rightly determined by the referral Court, it is found that the data sale deed relied upon by the Land Acquisition Officer, considering the topo sketch of the Village projected in the matter and in such view of the matter, it is found that the property comprised in the data sale deed relied upon by the land Acquisition Officer is not situated abutting the main road, whereas the acquired lands are found to be situated abutting the main road and therefore, rightly determined that the lands covered under the data sale deed and the acquired lands are not similarly placed and therefore, the value fixed by the Land Acquisition Officer based on the data sale deed is highly low and the same cannot be the basis for fixing the value of the acquired lands. The abovesaid determination of the Court below, considering the available materials, is found to be not unacceptable.
9. The sale deed relied upon by the claimants for fixing the value of the acquired lands is also found to be not abutting the road as the acquired lands and further the land covered in the sale deed relied upon by the claimants is also found to be situated for away from the acquired lands and accordingly, the Court below had also not taken into consideration the value of the sale deed relied upon by the claimants. In the sale deed relied upon by the claimants, the value of the property had been fixed at Rs.110 per cent. On noting the lie of the land covered in the sale deed relied upon by the claimants and the lie of the acquired lands, it is found that as determined by the referral Court, the Lands covered in the sale deed relied upon by the claimants are not situated near the acquired lands and also not abutting the road.
10. The grievance of the appellant is that the sale deed relied upon by the claimants depict the value of the land at Rs.110/- per cent and therefore, according to the appellant, the referral Court having determined the value of the acquired lands at Rs.300/- per cent and therefore, according to the appellant, the compensation fixed by the referral Court needs reversal. However, the referral Court has not based its determination mainly upon the sale deed relied upon by the claimants. On the other hand, considering the reasonings of the referral Court, it is found that the referral Court has taken into consideration the various factors before arriving at the compensation determined by it. According to the referral Court, considering the lie of the acquired lands, they being abutting the main road and also further noting that the acquired lands on account of their location having high potential to be converted as house sites and as they had already ceased to be agricultural lands and furthermore, had also taken into consideration the road access to the acquired lands and the possibility of development due to the weavers village situated adjacent to the acquired lands, accordingly, chosen to fix the market value of the acquired lands at the rate of Rs.300/- per cent.
11. It is thus found that the referral Court had considered the various factors before assessing the market value of the acquired lands at Rs.300/- per cent. It is not in dispute that the acquired lands are abutting the main road and therefore, there are more prospects for conversing the same into house sites and when it is seen that as put forth by the claimants, the acquired lands are adjacent to the weavers town viz., Guruvarajapet and there are various power looms at Guruvarajapet and further, the other facilities are available in and around the acquired lands and the frequent buses plying through the road abutting which the acquired lands are situated, on that score, it is seen that there is high possibility of the increase in the potentiality of the acquired lands and the abovesaid factors had been the basis for the referral Court to fix the value of the acquired lands at Rs.300/- per cent.
12. Considering the factors which weighed with the referral Court for determining the market value at the rate of Rs.300/- per cent, not to be discarded easily and in particular, when the potentiality of the acquired lands and the reasonable use that it could be put in use either immediately or in the near future, the abovesaid factors are relevant for determining the value of the same and the abovesaid factors having been taken into consideration by the referral Court and when it is found that the acquired lands are near the weavers town viz., Guruvarajapet and also surrounded by Schools and other facilities and easy accessibility of the acquired lands through buses frequently plying on the road abutting the same, in all, it is seen that there is no compulsion on the part of the referral Court to fix only the value of the property as depicted in the sale deed relied upon by the claimants, particularly, when the property comprised in the sale deed relied upon by the claimants is found to be away from the acquired lands and also not abutting the main road. In such view of the matter, the referral Court is found to be justified in fixing the value of the acquired lands at Rs.300/- per cent by taking into consideration the various factors as above discussed and in my considered opinion, the determination of the abovesaid value for the acquired lands by the referral Court cannot be held to be exorbitant or fixed without any basis.
13. In this connection, the counsel for the claimants contended that the value fixed by the referral Court is only for a paltry amount and even the said amount had not been paid to the claimants for the past 30 years since the date of the notification and without any payment, the claimants have been deprived of their lands and thereby put to huge loss and hardship and according to him, the Government should be held responsible for filing frivolous appeal against such paltry sum as awarded by the referral Court, that too on a proper analysis of the materials placed on record and other justifiable factors and particularly, when the referral Court has proceeded to determine the valuation of the acquired lands based upon the potentiality of the same and for the reasonable use that they could be utilised either immediately or in the near future and in this connection, placed reliance upon the decision reported in (2010) 9 Supreme Court Cases 118 (A.Natesam Pillai Vs. Special Tahsildar, Land Acquisition, Tiruchy). In the abovesaid decision, the Supreme Court has held that the potentiality of the acquired land, insofar as it relates to use to which it is reasonably capable of being put in immediate or near future, must be given due consideration for determining the value of the acquired lands and the position of law with reference to the same has been outlined in the abovesaid apex Court decision as follows:
“A. Land Acquisition Act, 1894 – S.23 – Compensation – Determination of – Potential value of the land – Whether to be considered – Held, potentiality of acquired land, insofar as it relates to use to which it is reasonably capable of being put in immediate or near future, must be given due consideration
B. Land Acquisition Act, 1894 – S.23 – Compensation – Deduction in valuation of large tracts of land where exemplar land is a small plot – Waiver of – Held, permissible on account of potentiality – As acquired land abuts main road and surrounded by Schools, Panchayat Union Office, shops and residential buildings around which building activity already started, deduction due to small size of the exemplar land can easily be set off with corresponding increase in price of acquired land when compared with exemplar land from point of view of potential value
C. Land Acquisition Act, 1894 – S.23 – Compensation – Market value – Acquisition of large tract of land – Exemplars of small plots – When relevant – Reiterated, small area of land in exemplar though not comparable with acquired land may not be an excellent guide but it is still a better guide than other documents exhibited, and same can be used as a relevant yardstick to assess just and reasonable compensation.
P. Ram Reddy V.Hyderabad Urban Development Authority, (1995) 2 SCC 305; Hasanali Khanbhai & Sons V. State of Gujarat, (1995) 5 SCC 422; Administrator General of W.B.V.Collector, Varanasi, (1988) 2 SCC 150; Rishi Pal Singh V.Meerut Development Authority, (2006) 3 SCC 205, relied on”
“18. The small area of land measuring 1710 sq. ft. was sold for Rs. 20,000/- as per Ex. A3 dated 15.7.92 which works out to a value of Rs. 11/- per sq. ft. A comparison of the two plots, namely, land in Ex. A3 and the acquired land shows that they are not identical. While the land in Ex. A3 may not be an excellent guide it is still a better guide than any other document exhibited on record. The same could be used as a relevant yardstick to assess the just and reasonable compensation in the present case.
19. We find from the counter affidavit filed by the respondent-State that the said land covered by the Ex. A3 is located out of the Municipal Corporation limit of Trichy, whereas the acquired land is located within the Municipal Corporation limit of Trichy. Consequently, it cannot be disputed that the acquired land, being in the heart of the city and having excellent prospects of being used as residential site, definitely has an edge regarding the potential value over the land covered by Ex. A3.
20. This building potentiality of acquired land must also be taken into consideration while determining compensation. In P. Ram Reddy v. Land Acquisition Officer, Hyderabad Urban Development Authority reported at (1995) 2 SCC 305, this Court held as follows: -
"8. Building potentiality of acquired land.-- Market value of land acquired under the LA Act is the main component of the amount of compensation awardable for such land under Section 23(1) of the LA Act. The market value of such land must relate to the last of the dates of publication of notification or giving of public notice of substance of such notification according to Section 4(1) of the LA Act. Such market value of the acquired land cannot only be its value with reference to the actual use to which it was put on the relevant date envisaged under Section 4(1) of the LA Act, but ought to be its value with reference to the better use to which it is reasonably capable of being put in the immediate or near future. Possibility of the acquired land put to certain use on the date envisaged under Section 4(1) of the LA Act, of becoming available for better use in the immediate or near future, is regarded as its potentiality. It is for this reason that the market value of the acquired land when has to be determined with reference to the date envisaged under Section 4(1) of the LA Act, the same has to be done not merely with reference to the use to which it was put on such date, but also on the possibility of it becoming available in the immediate or near future for better use, i.e., on its potentiality. When the acquired land has the potentiality of being used for building purposes in the immediate or near future it is such potentiality which is regarded as building potentiality of the acquired land. Therefore, if the acquired land has the building potentiality, its value, like the value of any other potentiality of the land should necessarily be taken into account for determining the market value of such land. Therefore, when a land with building potentiality is acquired, the price which its willing seller could reasonably expect to obtain from its willing purchaser with reference to the date envisaged under Section 4(1) of the LA Act, ought to necessarily include that portion of the price of the land attributable to its building potentiality. Such price of the acquired land then becomes its market value envisaged under Section 23(1) of the LA Act. If that be the market value of the acquired land with building potentiality, which acquired land could be regarded to have a building potentiality and how the market value of such acquired land with such building potentiality requires to be measured or determined are matters which remain for our consideration now."
21. This Court in Hasanali Khanbhai & Sons v. State of Gujarat reported in (1995) 5 SCC 422 also held that:
"3. .......But it is settled law by series of judgments of this Court that the court is not like an umpire but is required to determine the correct market value after taking all the relevant circumstances, evinces active participation in adduction of evidence; calls to his aid his judicial experience; evaluate the relevant facts from the evidence on record applying correct principles of law which would be just and proper for the land under acquisition. It is its constitutional, statutory and social duty. The court should eschew aside feats of imagination but occupy the armchair of a prudent, willing but not too anxious, purchaser and always ask the question as to what are the prevailing conditions and whether a willing purchaser would as a prudent man in the normal market conditions offer to purchase the acquired land at the rates mentioned in the sale deeds. After due evaluation taking all relevant and germane facts into consideration, the Court must answer as to what would be the just and fair market value...... "
22. Therefore, it is clear from the aforementioned decisions of this Court that the potentiality of the acquired land, in so far as it relates to the use to which it is reasonably capable of being put in the immediate or near future, must be given due consideration.
23. The present acquired land has all the potentiality to be used as building sites, even in the immediate future, as it is located at a place in and around which building activity has already started. The evidence on record also clearly indicates that acquired land is abutting the main road. The acquired land is also surrounded by schools, Panchayat union office, shops and residential building in all three sides. The High Court also found, as a matter of fact, that the area where the acquired land is situated is fit for construction of houses. On an overall consideration and appreciation of the records, we feel that the deduction due to the small size of the exemplar land can easily be set off with the corresponding increase in price of the acquired land when compared with the land in Ex. A3 from the point of view of potential value.
24. Although it is true that the land covered by Ex. A3 is a small tract of land and therefore cannot be compared in size with the large area of land acquired under the present notification, it is to be concluded that the land in question would definitely fetch a higher price than what is fixed by the High Court. A prospective purchaser would only be too willing to pay for the acquired land having immediate potentiality of being used as a residential site in a prime locale at almost the same, if not, higher price than the land covered by Ex. A3 which is located outside the Municipality area.
25. We are in agreement with the conclusion of the High Court that the acquisition of a large tract of land merits a discount in compensation. However, in the present circumstance, it is significant to note that the compensation granted by the High Court does not match the potentiality of the land, even after the discount has been taken into consideration. Even on giving a discount in respect of the acquired land being a large tract as compared to the small portion of land sold under Ex. A3, according to us, the rate of Rs. 11/- would be adequate and just compensation for the same.
26. In our considered opinion, by scaling down the rate of compensation to Rs. 9/- from Rs. 11/- per sq. ft., the High Court denied just and reasonable compensation to appellant, thereby resulting in a miscarriage of justice.”
14. Further, in the decision relied upon by the claimants' counsel reported in (2010) 3 Supreme Court Cases 794 (Thakur Kuldeep Singh (dead) Through LRs. And others Vs. Union of India and others), as to what are the factors which are to be considered by the land acquisition officer and the Court concerned for fixing the value of the acquired lands, the position of law has been outlined in the abovesaid decision as follows:
“A.Land Acquisition Act, 1894 – Ss.23 and 54 – Compensation – Extent of development in vicinity or neighbourhood of acquired land – Circle rates notified by Government – Extent to which relevant – Land acquired for hospital – Further, enhancement of compensation over that awarded by High Court claimed on ground that acquired land located in commercial hub having all facilities – Reliance upon circle rates for commercial plots under government notification – sustainability – Held, market value for acquired lands cannot be fixed merely on basis of circle rate – Locality and prevailing circumstances are relevant for determining real value of land – Government rates can be considered as corroborative evidence – Acquired plot located in midst of commercial properties and had commercial potentiality - Reference Court overlooked evidence that after the property was purchased considerable development had taken place in and around the area – On consideration of location and various activities in and around the plot, amount determined by High Court found just, reasonable and acceptable – However, no further enhancement warranted.
B. Land Acquisition Act, 1894 – Ss.23 and 24 – Compensation – Award of – Factors to be considered – Reiterated.”
“12. While fixing compensation, it is the duty of the Land Acquisition Collector as well as the Court to take into consideration the nature of the land, its suitability, nature of the use to which the lands are sought to be acquired on the date of notification, income derived or derivable from or any other special distinctive feature which the land is possessed of, the sale transactions in respect of land covered by the same notification are all relevant factors to be taken into consideration in determining the market value. It is equally to consider the suitability of neighbourhood lands as are possessed of similar potentiality or any advantageous features or any special characteristics available.
13. The Land Acquisition Collector as well as the Court should always keep in their mind that the object of assessment is to arrive at a reasonable and adequate market value of the land. While doing so, imagination should be eschewed and mechanical assessment of evidence should be avoided. More attention should be on the bona fide and genuine sale transactions as guiding star in evaluating the evidence. The relevant factor would be that of the hypothetical willing vendor would offer for the land and what a willing purchaser of normal human conduct would be willing to buy as a prudent man in normal market conditions prevailing in the open market in the locality in which the acquired lands are situated as on the date of notification under Section 4(1) of the Act. In other words, the Judge who sits in the armchair of the willing buyer and seek an answer to the question whether in the given set of circumstances as a prudent buyer he would offer the same market value which the court proposed to fix for the acquired lands in the available market conditions. The market value so determined should be just, adequate and reasonable.”
15. The counsel for the claimants also vehemently contended that the claimants had been deprived of their livelihood by the appellant by way of the acquisition of their lands and also not paid a single pie towards the compensation for the past 30 years. The Court should consider the plight of the farmers in the abvoesaid acquisition process and according to him, the abvoesaid factors had been considered by the Apex Court in various decisions and to highlight the same, he has adverted to the Apex Court decision where the plight of farmers, who are facing the continuous struggle for existence on account of the acquisition of their lands and refusal of compensation payable to them in time had been discussed and analysed by the apex Court in the decision reported in (2015) 14 Supreme Court Cases 327 (Bhusawal Municipal Council Vs. Nivrutti Ramchandra Phalak and others) in the following manner:
“17. The fundamental right of a farmer to cultivate his land is a part of right to livelihood “Agricultural land is the foundation for a sense of security and freedom from fear. Assured possession is a lasting source for peace and prosperity.” India being predominantly an agricultural society, there is a “strong linkage between the land and the person’s status in the social system.”
“10". . . .A blinkered vision of development, complete apathy towards those who are highly adversely affected by the development process and a cynical unconcern for the enforcement or the laws lead to a situation where the rights and benefits promised and guaranteed under the Constitution hardly ever reach the most marginalised citizens.
11. . . . For people whose lives and livelihoods are intrinsically connected to the land, the economic and cultural shift to a market economy can be traumatic." (Vide: Mahanadi Coal Fields Ltd. & Anr. v. Mathias Oram & Ors., (2010) 11 SCC 269; and Narmada Bachao Andolan v. State of Madhya Pradesh & Anr., AIR 2011 SC 1989)
18. A farmer’s life is a tale of continuous experimentation and struggle for existence. Mere words or a visual can never convey what it means to live a life as an Indian farmer. Unless one experiences their struggle, that headache he will never know how it feels. The risks faced by the farming community are many; they relate to natural calamities such as drought and floods; high fluctuation in the prices of input as well as output, over which he has no control whatsoever; a credit system which never extends a helping hand to the neediest; domination by middlemen who enjoy the fruits of a farmer’s hard work; spurious inputs, and the recent phenomenon of labour shortages, which can be conveniently added to his tale of woes. Of late, there have been many cases of desperate farmers ending their lives in different parts of the country. The Principles of Economics provides for the producer of a commodity to determine his prices but an Indian farmer perhaps is the only exception to this principle of economics, for even getting a decent price for their produce is difficult for them.
19. Economic growth through the 1990’s had made India a more market- oriented economy, but had failed to benefit all Indians equally. The problems that plagued the farmers several decades ago are still glaringly present today; there is little credit available. What is available is very expensive. There is no advice on best practice in conducting agriculture operations. Income through farming is not enough to meet even the minimum needs of a farming family. Support systems like free health facilities from the government are virtually non-existent. The drama of millions leaving their homes in search of jobs, which are non-existent of villages swiftly losing able-bodies of adults, leaving behind the old, hungry and vulnerable. Families break up as their members head in diverse directions.
20. We do not see any justification in the appellant approaching this Court with an object to get an interim order so as not to make any payment of enhanced amount of compensation. Such attitude not only amounts to high-handedness and arbitrariness on its part, rather it may cause serious prejudice to the respondents. The excuse that the appellant-council has paucity of fund cannot be accepted as a justified cause to entertain the petition. If the land is to be acquired, law requires prompt payment of compensation. In case the party by whom or for whom the land is acquired is not in a position to make the payment of compensation, the person-aggrieved becomes entitled to get the land restored. Payment of compensation as per award under Section 11 of the Act 1894, cannot be sufficient security to serve the interest of the person-interested pending adjudication of appeal against the reference court’s award. “
16. Similar views had also been expressed by the apex Court in the decision reported in (2011) 12 Supreme Court Cases 375 (Greater Noida Industrial Development Authority Vs. Devendra Kumar and others) and the same has been outlined in the abovesaid decision in the following manner:
“49. Before concluding, we consider it necessary to reiterate that the acquisition of land is a serious matter and before initiating the proceedings under the 1894 Act and other similar legislations, the Government concerned must seriously ponder over the consequences of
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depriving the tenure – holder of his property. It must be remembered that the land is just like mother of the people living in the rural areas of the country. It is the only source of sustenance and livelihood for the landowner and his family. If the land is acquired, not only the present but the future generations of the landowner are deprived of their livelihood and the only social security. They are made landless and are forced to live in slums in the urban areas because there is no mechanism for ensuring alternative source of livelihood to them. Mindless acquisition of fertile and cultivable land may also lead to serious food crisis in the country. 50. In the result, the special leave petitions are dismissed. The Greater Noida Development Authority is saddled with costs of Rs.10 lakhs for undertaking an exercise of allotment of land to the builders in complete violation of the purpose for which the land was sought to be acquired and even before approval by the State Government for the change of land use. The amount of costs shall be deposited in the Supreme Court Legal Services Committee within a period of three months from today. 51. We are not unmindful of the plight of large number of persons, who have made investment by booking flats, etc. but, at the same time, it is impossible to ignore that the landowners and their transferees have been deprived of their property and the only source of livelihood in the most arbitrary and mala fide manner without following the procedure established by law. It will be grave injustice to the people belonging to the latter category if the acquisition impugned before the High Court is sustained only with a view to save the investment made by those who are aspiring to acquire some property from the builders. However, it is made clear that those who have paid money to the builders for booking flats, etc. shall be entitled to get back the amount along with interest at an appropriate rate and if the builders refuse to repay the amount, then they shall be free to avail appropriate legal remedy.” 17. Considering the abovesaid factors in toto particularly, when the referral Court has determined the value of the acquired lands based on the potentiality of the lands acquired as well as the other factors and the lie of the lands and the developments in the vicinity or neighbourhood of the acquired lands and when it is further noted that the referral Court had not fixed any exorbitant value and also rightly discarded the data sale deed relied upon by the Land Acquisition Officer as well the sale deed relied upon by the claimants, in all, in my considered opinion, no interference is called for in the determination of the value of the acquired lands as fixed by the referral Court. In the light of the abovesaid discussions, I hold that the compensation fixed by the referral Court is just and reasonable and accordingly, the Point No.1 is answered 18. Point Nos.2 & 3 For the reasons aforestated, the judgment and decree dated 29.07.2013 passed in L.A.O.P.Nos.112, 114, 115, 116 & 117 of 2013 respectively on the file of the Special Subordinate Court, Arakkonam, are confirmed and resultantly, the first appeals are dismissed with costs. Consequently, connected miscellaneous petition, if any, is closed.