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Sunday, December 15, 2013

Land Acquisition Act - enhancement of Market value - by applying principle of 12% increase per year on the market value as the 12% per annum increase which courts have often found to be adequate in compensation matters hardly does justice to those land owners whose land have been acquired as judicial notice can be taken of the fact that the increase is not 10 or 12 or 15% per year but is often upto 100% a year for land which has the potential of being urbanized and commercialized such as in the present case.” - Apex court enhanced the compensation = Kashmir Singh …Appellant(s) Vs. State of Haryana & Ors. …Respondent(s) = published in judis.nic.in/supremecourt/filename=41088

Land Acquisition Act - enhancement of Market value - by applying principle of 12% increase per year  on the market value as the  12%  per  annum increase  which  courts  have  often  found  to  be  adequate  in compensation matters hardly does justice  to  those  land  owners whose land have been acquired as judicial notice can be taken  of the fact that the increase is not 10 or 12 or 15% per year but is often upto 100% a year for land which has the potential of  being urbanized and commercialized such as in the present case.” - Apex court enhanced the compensation =

When 12% per annum increase applies =

in Udho Das vs. State of Haryana 2010 (8) SCR 900:

                  “….Concededly, the Act also provides for  the  payment  of
           the solatium, interest and an additional amount but we are of the
           opinion, and it is common knowledge, that even these payments  do
           not keep pace with the astronomical rise in prices in many  parts
           of India, and most certainly in North India, in  the  land  price
           and cannot fully compensate for the acquisition of the  land  and
           the payment of the compensation in driblets. The  12%  per  annum
           increase  which  courts  have  often  found  to  be  adequate  in
           compensation matters hardly does justice  to  those  land  owners
           whose land have been acquired as judicial notice can be taken  of
           the fact that the increase is not 10 or 12 or 15% per year but is
           often upto 100% a year for land which has the potential of  being
           urbanized and commercialized such as in the present case.”




7.    His last submission was that in any case,  the  matter  had  now
been set at rest by recent judgment of this Court in  Asharfi  &  Ors.
Vs. State of Haryana 2013 (5) SCC 527 where similar submissions, which
are made by the appellants herein, have been accepted by the court.
We are of the view that the matter does  not  require  elaborate
discussion inasmuch as the acquisition of land in  Fatehabad  District
itself, which was acquired in the year 1993 was the subject matter  of
consideration in the case of Asharfi (supra).  
In that case,
The Court fixed the compensation @ Rs.3.50 per  square  yard
as on 1993 and the following discussion ensued in this behalf in  Para
15 of the judgment.

10.   It is clear from the above that price of land in the  said  area
in 1991 was fixed @ Rs.420/- per square yard.  The Court  had  applied
the formula of 12% per year in the valuation of land and on that basis
fixed the market rate at approximately Rs.520/- per square yard  after
taking a deduction of one-third, the valuation was arrived at Rs.350/-
per square yard in  the  year  1993.   =
Going by the formula adopted in the aforesaid judgment, 12%  per
annum increase can be applied on  the  value  of  land  determined  as
Rs.520/- per square yard in the year 1993, upto the year 2001 when the
Notification under Section 4 of the Act  was  issued  in  the  instant
case.  
However, we cannot be oblivious to the fact that from  1993  to
2001, there was a period when instead of increase in the  land  price,
there was attrition in the land rates.  
Therefore, we  would  like  to
enhance the value by applying the formula of 12%  per  annum  increase
for a period of 4 years, instead of taking entire period 1993 and 2001
(and this would not be treated as a precedent).   
When  calculated  in
this manner, the valuation of the land in the year 2001 shall come  to
Rs.770/- per square yard.   
After  making  a  deduction  of  one-third
therefrom the  net  valuation  comes  to  Rs.514/-  per  square  yard.
Compared to the land value of this very area in 1993 which  was  fixed
at Rs.350/- per square yards, we have increased the same by about  50%
over a period of 7 years or so, which we think, is quite reasonable as
this much compensation is legitimately due  to  the  appellants.   We,
accordingly, fix the compensation @ Rs.514/- per square yard  for  the
acquired land of the appellants.

                                [REPORTABLE]

                        IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

                         CIVIL APPEAL NO. 11030/2013
      (arising out of Special Leave Petition (Civil) No. 3711 of 2011)

Kashmir Singh
…Appellant(s)

            Vs.

State of Haryana & Ors.
…Respondent(s)

With

C.A.No11031/2013 @ SLP(civil) No.3743/2011

C.A.No.11032/2013 @ SLP(civil) No.3776/2011

C.A.No.11033/2013 @ SLP(civil) No.3791/2011

C.A.No.11034/2013 @ SLP(civil) No.3901/2011

C.A.No.11035/2013 @ SLP(civil) No.3909/2011

C.A.No.11036/2013 @ SLP(civil) No.3911/2011

C.A.No.11037/2013 @ SLP(civil) No.3914/2011



                               J U D G M E N T

A.K.SIKRI,J.

1.    Leave granted.

2.    In all these appeals, challenge is laid to the judgment  of  the
High Court pronounced  on  20th  September  2010,  whereby  number  of
appeals  filed  for  enhancement  of  compensation  under   the   Land
Acquisition Act, 1894 (hereinafter referred to as the ‘LA  Act’)  were
dismissed by the High Court.
The land of the appellants was  acquired
by the Government of Haryana, which falls in  the  Revenue  Estate  of
Tohana,  Tehsil  Tohana,  District  Fatehabad,  Haryana.    The   Land
Acquisition Collector (LAC) had  assessed  the  market  value  of  the
acquired land @ Rs.2,75,000/- per acre for  chahi,  Rs.1,75,000/-  per
acre for Tibba/Tall and Rs.3,25,000/- per acre for gair  mumkin  land.
The appellants had filed  objections  to  the  said  determination  of
compensation by the LAC and the matter was  referred  to  the  learned
Additional District Judge, Fatehabad under Section 18 of the  LA  Act.
The learned ADJ passed the award dated 21.2.2006.  Vide this award, he
categorized the  land  into  two  categories,  namely  category-A  and
category-B and fixed the compensation of Rs.8,00,000/-  per  acre  for
category-A  and  Rs.6,50,000/-  per  acre   for   category-B.    Still
dissatisfied and aspiring for further enhancement of the compensation,
the appellants filed Regular First appeal from the aforesaid orders of
the learned ADJ.  However, these appeals have been  dismissed  holding
that the compensation as fixed by the learned ADJ is  appropriate  and
does not call for any further enhancement.  Feeling aggrieved, present
appeals have been filed.  Since the land  of  all  the  appellants  is
situate in Revenue Estate of Tohana, District Fatehabad,  Haryana  and
is acquired by the same Notification, facts  pertaining  to  the  said
Notification apply to all these appellants.  The only difference is in
the quantum of land which was owned by these appellants and  has  been
taken away by the State in  acquisition.   Therefore,  taking  general
note of the particulars of acquisition and the nature of  land,  would
serve the purpose.

3.    Notification under Section 4 of the Land Acquisition  Act,  1894
was issued on 11.1.2001.  This was published in  official  gazette  on
08.01.2002.  The land is situate in revenue estate of Tohana, District
Fatehabad, Haryana.  The public purpose mentioned was the construction
of godowns and rice mills at Tohana,  for  HAFED  (Haryana  State  Co-
operative Supply and Market Federation Ltd.).   In  pursuance  to  the
Land Acquisition Collector’s Award dated 19.9.2003, the acquired lands
were taken  possession  on  17.12.2003.   
The  Reference  Court  under
Section 18 of the Act vide its  award  dated  21.2.2006  assessed  the
compensation @ Rs.8/- Lac  per  acre  and  Rs.6.50  Lac  per  acre  by
categorizing the acquired land in two categories, viz. Category-A  and
Category-B.  Under Section 23 (1-A) of the  Act,  the  escalation  was
fixed at 12%  per  annum  on  the  assessed  compensation.  The  other
statutory benefits were also allowed thereby.
The  appeals  filed  by
land  owners  before  the  High   Court,   seeking   enhancement    of
compensation and the  appeal  filed  by  HAFED  seeking  reduction  of
compensation are decided by the High Court of Punjab and Haryana  vide
a common judgment dated 20.9.2010.  Appeals of both the  parties  have
been dismissed as noted above.

4.    A perusal of the judgment of the High Court  would  reveal  that
though the appellants had produced on record certain  sale  deeds  and
other documents showing higher value of the land, the High Court chose
to rely upon only one document, namely, Ex.P-15 which is a  conveyance
deed registered for  sale  by  Haryana  State  Industrial  Development
Corporation (HSIDC) to the Central Warehousing Corporation (CWC). Vide
this Conveyance Deed 34,475 square meters of  land  was  sold  by  the
HSIDC to CWC @ Rs.150/- per square meter.  The allotment letter issued
in this behalf was  dated  4.9.2001  and  from  this  the  High  Court
inferred that process for sale  must  have  been  started  much  prior
thereto.  In the instant case, since the Notification under Section  4
of the LA Act is dated 11.1.2001, in the opinion of the High Court, it
was the most approximate date to the aforesaid sale of land in  favour
of CWC.  The High Court also found  that  the  land  sold  to  CWC  is
located at a link road whereas the land of the  appellants  which  was
acquired by the Government was located at a crossing of five roads and
thus lands sold of HSIDC to CWC was better located.  The  High  Court,
thus, relied upon the said sale deed on the  basis  of  which  it  has
concluded that the assessment of compensation by the  learned  ADJ  is
most appropriate.

5.    In an endeavour to find fault with the aforesaid approach of the
High Court, Mr. Singla, the learned senior counsel appearing  for  the
appellants submitted that the High Court committed an error in relying
upon the said solitary document and in the process ignore  other  more
relevant documents which had been  produced  by  the  appellants.   He
submitted that the acquired land is strategically  located  which  the
landowners have proved by producing on record the site  plans,  Ex.P-6
and Ex.P-28. The acquired land is located near  the  industrial  area.
There are many commercial establishments  located  near  the  acquired
like viz. FCI godwon, CWC godown, HUDA Colony, Grain Market of Tohana,
Mirch Mandi, Railway  Station.  The  land  is  situated  in  the  fast
developing area of Tohana  town  and  all  the  civil  facilities  are
available there.  The acquired land is situated  on  a  State  Highway
close to industrial and residential area. The valuation  of  the  land
considering the same merely of agricultural kind is not fair as it had
great future potential.  Mr. Singla specifically  referred  to  Ex.P-1
and Ex.P-4 which  are  the  Government  documents  and  as  per  these
documents even the State agencies had been  mentioning  the  value  of
acquired land @ Rs.7/- Lac per acre.   He  also  referred  to  Ex.P-18
which shows the allotment of commercial plot of 100  square  yards  by
HUDA @ Rs.1193/- per square yard.   His  submission  was  that  though
these arguments and the aforesaid referred documents were specifically
taken note of by the High Court but  not  dealt  with  and  completely
ignored.  Mr. Singla also drew our attention to the following findings
of the Reference Court regarding the nature of the land:

            “…….After careful consideration of the case law relied  upon  by
           both the parties and after appreciating the evidence  brought  on
           record by both the parties, it is held that in view of the cogent
           and reliable oral as well as documentary  evidence  coupled  with
           the admissions of RW1, it is clearly proved on the file  that  as
           far as the location and potentiality  of  industrial,  commercial
           and industrial nature and it was not simply agricultural land  as
           found by the learned Land Acquisition Collector while fixing  the
           market rate and as such, the market  rate  granted  by  the  Land
           Acquisition Collector was much less than the prevailing  rate  at
           that time.”



6.    He further referred to the following observation from the judgment  of
this Court in Udho Das vs. State of Haryana 2010 (8) SCR 900:

                  “….Concededly, the Act also provides for  the  payment  of
           the solatium, interest and an additional amount but we are of the
           opinion, and it is common knowledge, that even these payments  do
           not keep pace with the astronomical rise in prices in many  parts
           of India, and most certainly in North India, in  the  land  price
           and cannot fully compensate for the acquisition of the  land  and
           the payment of the compensation in driblets. The  12%  per  annum
           increase  which  courts  have  often  found  to  be  adequate  in
           compensation matters hardly does justice  to  those  land  owners
           whose land have been acquired as judicial notice can be taken  of
           the fact that the increase is not 10 or 12 or 15% per year but is
           often upto 100% a year for land which has the potential of  being
           urbanized and commercialized such as in the present case.”




7.    His last submission was that in any case,  the  matter  had  now
been set at rest by recent judgment of this Court in  Asharfi  &  Ors.
Vs. State of Haryana 2013 (5) SCC 527 where similar submissions, which
are made by the appellants herein, have been accepted by the court.

8.    Learned counsel appearing for Haryana State Co-operative  Supply
and Market Federation Ltd. (HAFED), on the other hand, submitted  that
the High Court has taken into consideration all the relevant documents
even including sale deed on which  the  appellants  relied  upon,  but
found that the only relevant document for the purpose of  arriving  at
just compensation was Ex.P-15. He submitted that in preferring to make
this document as the basis for compensation, the High Court has  given
cogent reasons and therefore judgment of  the  High  Court  cannot  be
faulted with.  His submission was that the learned  ADJ  had  suitably
enhanced the compensation by increasing it  quite  substantially  than
what was granted by the LAC.  His further submission was that reliance
on allotment letter dated 8.10.2002 (Ex.P-18)  during  the  course  of
arguments, was totally misconceived as this was not  even  pleaded  in
the memo of SLP filed or the memo of appeals  filed  before  the  High
Court.  In any case, the relevant date  for  determination  of  market
price of the land was 11.1.2001 when Notification under Section  4  of
the LA Act was issued and relying upon two allotment letters  were  of
subsequent dates which were issued more than 17 months after the  date
of issuance of Section 4 Notification.  Therefore, relying upon  these
documents was totally misplaced.  Referring to  the  question  of  law
framed in the SLP, he further submitted  that  the  earlier  arguments
advanced were neither raised in the SLP nor argued before  the  courts
below and therefore the appellants cannot be  allowed  to  take  fresh
plea  for the first time in this Court. It  was  also  his  submission
that the judgment relied upon by the appellants had no application  to
the         facts         of         the         present         case.


9.    We are of the view that the matter does  not  require  elaborate
discussion inasmuch as the acquisition of land in  Fatehabad  District
itself, which was acquired in the year 1993 was the subject matter  of
consideration in the case of Asharfi (supra).  
In that case, the court
had  dealt  with  various  Notifications  issued  by  different  State
Governments acquiring lands in their respective States.   It  included
acquisition of lands situated in Fatehabad, District Hissar,  Harayana
as well.  The Court fixed the compensation @ Rs.3.50 per  square  yard
as on 1993 and the following discussion ensued in this behalf in  Para
15 of the judgment.

10.   It is clear from the above that price of land in the  said  area
in 1991 was fixed @ Rs.420/- per square yard.  The Court  had  applied
the formula of 12% per year in the valuation of land and on that basis
fixed the market rate at approximately Rs.520/- per square yard  after
taking a deduction of one-third, the valuation was arrived at Rs.350/-
per square yard in  the  year  1993.   
The  relevant  portion  of  the
judgment, in this behalf reads as under:

              In regard to the 157.20 acres of land situated in  Fatehabad,
           District Hisar, Haryana, acquired for utilisation and development
           of residential and commercial purposes in  Sector  3,  Fatehabad,
           the compensation in respect thereof has been questioned in  Civil
           Appeals Nos. 319-52 of 2011 by one Mukesh and a number of appeals
           have been tagged with the said matter, including the one filed by
           the Haryana Urban Development  Authority,  being  SLPs  (C)  Nos.
           26772-79 of 2009 (now appeals).  As  indicated  hereinbefore,  in
           para 25, the Collector had awarded compensation at a uniform rate
           of Rs 1,81,200/- per acre  along  with  statutory  benefits.  The
           Reference Court determined the compensation at the  uniform  rate
           of Rs 206 per square yard. The High Court modified the said award
           and awarded compensation at the rate of Rs 260  per  square  yard
           for the land acquired up to the  depth  of  100  meters  abutting
           National Highway No. 10. The value of the rest  of  the  acquired
           land was maintained at Rs  206  per  square  yard.  The  area  in
           question being already developed to some extent, a cut of 50%  on
           the value is, in our view, excessive. 
We agree  with  Mr.  Swarup
           that resorting to the  belting  system  by  the  High  Court  was
           improper and that at best a standard cut of one-third would  have
           been  sufficient  to  balance  the  smallness  of  the   exhibits
           produced. 
It has been  pointed  out  by  Mr.  Swarup  that  on  a
           comparative basis, the price of lands in the area in 1991 was  on
           an average of about Rs 420 per square yard. 
Given the sharp  rise
           in land prices, the value, according to Mr.  Swarup,  would  have
           doubled to about Rs 800 per square yard by 1993. 
Even if we  have
           to apply the formula of 12% increase, the valuation of the  lands
           in question in 1993 would be  approximately  Rs  527  per  square
           yard. 
Imposing a deduction of one-third, valuation comes to about
           Rs 350 per square yard, which, in our view, would be  the  proper
           compensation for the lands covered in  the  case  of  Mukesh  and
           other connected matters.”




11.   Going by the formula adopted in the aforesaid judgment, 12%  per
annum increase can be applied on  the  value  of  land  determined  as
Rs.520/- per square yard in the year 1993, upto the year 2001 when the
Notification under Section 4 of the Act  was  issued  in  the  instant
case.
However, we cannot be oblivious to the fact that from  1993  to
2001, there was a period when instead of increase in the  land  price,
there was attrition in the land rates.
Therefore, we  would  like  to
enhance the value by applying the formula of 12%  per  annum  increase
for a period of 4 years, instead of taking entire period 1993 and 2001
(and this would not be treated as a precedent).  
When  calculated  in
this manner, the valuation of the land in the year 2001 shall come  to
Rs.770/- per square yard.   
After  making  a  deduction  of  one-third
therefrom the  net  valuation  comes  to  Rs.514/-  per  square  yard.
Compared to the land value of this very area in 1993 which  was  fixed
at Rs.350/- per square yards, we have increased the same by about  50%
over a period of 7 years or so, which we think, is quite reasonable as
this much compensation is legitimately due  to  the  appellants.   We,
accordingly, fix the compensation @ Rs.514/- per square yard  for  the
acquired land of the appellants.

12.   The appeals are allowed to the aforesaid extent.




                                                              ………………………………J.
                                            (Surinder Singh Nijjar)




                                                             ……………………………….J.
                                            (A.K.Sikri)
      New Delhi,
      December 13, 2013

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