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K.U.M.S. v. Bishan Dass & Others - FIRST APPEAL No. 862 of 1989 [2005] RD-AH 4325 (18 October 2005)


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            First Appeal No. 862 of 1989

   Krishi Utpadan Mandi Samiti Vs. Bishan Das                                and  others.                                                  

Hon'ble Yatindra Singh,J

Hon'ble R.K.Rastogi,J

(Delivered  by Hon'ble R.K.Rastogi,J)


1. This is an appeal  against the judgment  and decree dated  19.11.1988 passed by Sri  Narendra Singh,  then  Additional District  Judge/Special  Judge  (E.C.Act), Etawah in  LAR No.76 of 1986, Bishan Das and others Vs. State of U.P.

2. The facts relevant  for disposal of  this appeal are that  on 14.6.76 a  Notification  under section 4(1) of  the Land Acquisition Act ( the Act) was issued by the State of  U.P.   for acquisition of 33.87 Acres of land  situate  in village  Sirsamau, Pargana, Tahsil and District Etawah for construction  of shopping  complex of  Krishi Utpadan  Mandi Samiti ( the Samiti). The Notification  under section  6(1) of the Act was  also issued on 15.6.76. The award was given by the  S.L.A.O.  Etawah in the  above case on 12.10.78 and in that award a sum of Rs. 3,19,888.79 paise  was awarded  as compensation.

3. An area of 2.40 acres of land situate in  plots no. 834, 835, 836, 837 and 838 belonging to  respondents no. 1,2 and 3 was also  acquired  in the above case. Sri Bishan Das, respondent no.1  aggrieved with the above acquisition, filed

        z       Civil Misc. Writ Petition No. 9035 of 1978 before this court  which was decided  on  4.11.1980 and  since  no  opportunity of hearing   had been provided  to  Sri Bishan Das  in the above  acquisition proceedings, the notification under section 6 of the Act was  quashed,  and the writ petition was  allowed to this extent.

4. After decision of the above  writ petition, a fresh notification under section 4 of the Act  was issued  on 26.4.1982 and this  time  it was   issued only in respect of  1.50 acres of land  of the  above  mentioned 5 plots leaving the remaining area of 0.90 acres of land. The last publication of this notification was made on 21.8.1982. The notification under section 6 of the Act was issued on 13.7.1984. The notice under section 9(3) of the Act  was issued on  24.1.1985 and the  S.L.A.O.  after  hearing the parties gave his  award on 30.5.1985. The S.L.A.O. relied upon  sale deeds no. 173 and 174 which  had been  executed  by Bishan Das  in respect of   0.02 acres of land   of  plot no. 834. Both  these sale deeds were executed  for consideration of Rs. 17380/-  each at the rate of Rs.20/- per  square  feet . On the basis of these sale deeds, the S.L.A.O.  fixed the  rate of  compensation at Rs.8,90,673.28 paise per  acre,  and after making deduction of 25% on this amount,  and allowing solatium at the rate of 30% he further provided  that the claimant would be entitled to 12%  per annum interest from the date of notification under section 4 of the Act till  the date of   possession  or publication  of the award whichever is earlier, and thereafter the claimant would be entitled to interest at the rate of 9/15% per annum according to law. He awarded  an amount of Rs.16,23,153.15 Paise.

5. The claimants being  not satisfied  with the above  award,  filed a reference  under section 18 of  the Act which was  referred to  the District Judge  for  determination. It was  heard and decided by Sri Narendra Singh , learned  Addl. District Judge/Special Judge (E.C.Act) vide his judgment  and decree dated 19.11.1988. It may be  mentioned that  the  only  plea  taken by  the claimants was that  there was no  justification for making  deduction  in the price of the land  at the rate of  25%.  Mr. Narendra Singh  decided the above reference vide his  judgment and decree dated 19.11.1988. He  was  of the view that  the above deduction at the rate of  25% in the price of  the land was  unjustified. He, therefore,  allowed the reference and  awarded  an additional  amount of Rs.5,58,897.97 paise  with the provision  of  payment of   interest  at the rate of 15% per  annum   upto the date of  payment ; it was further provided  that the interest  will be  payable  at the rate of 9%  per annum if  the payment  is made within one year. Aggrieved with that judgment and decree  the appellant  filed this appeal.

6. It may be mentioned that  the claimants  filed  a review application  before the  Addl. Distt. Judge/Special Judge (E.C.Act), Etawah in which  it was mentioned that  due to some  error  it was not specifically  mentioned in the order  as to   from which date the interest  at the  rate of 15% and 9% shall be  payable. It was prayed that  this interest  should be allowed from 30.5.1985 which  was  the date of the award. The   review application  was  also  heard  by Sri      Narendra

Singh and he decided the same vide  his  order dated 28.3.1989 in which   he  mentioned that  the interest  is to be  allowed from the  date  of  possession and  since it was not clear  from the record   as to   on what date  possession was taken  by the  State of U.P., he  was of the  view that  possession  must have been taken  within a period of six months from the date of award. He , therefore, passed an order  on the review application that  since the date of award was 30.5.1985 the date of possession  can be taken  to be  30.11.85 and so  interest at the rate of 9%  on the   enhanced amount  would be  admissible   from 30.11.1985 to 29.11.1986 and   at the rate of  15% from 30.11.1986 upto to  the date of payment. Both these orders have been  assailed  by the appellant at the time of  arguments in the  appeal.

7. Learned counsel  for the  appellant  pointed out that though the land was acquired for  the  Samiti  and  it   has   to pay   price  of the land, solatium  and  interest etc. in accordance with  the provisions    of the Act,   yet  no notice was given to it either by  the S.L.A.O.  or by  the Additional District Judge , Etawah,  and so the  impugned order  should be  set aside and the appeal  should be  allowed, and  the appellant should be given  opportunity to  contest  the case before the    Reference Court. In this connection, the learned counsel for the appellant  also placed reliance upon   a Full Bench Ruling  of five   Judges of Hon'ble Supreme  Court  in U.P.  Awas Evam Vikas Parishad Vs. Gyan Devi: AIR 1995 SC 724 in which it has been held that  when there is an acquisition of land   for the local authority or  Company,  that local authority or company  has got a right of  being heard in the matter.

8. Since,  in the present case no opportunity of hearing was given to the  appellant- Samiti either  by  the S.L.A.O. or by  the Additional District Judge, (who decide the  reference under section 18  of the Act) the appellant is  entitled  to the  opportunity  of hearing  before  the trial court,  but,  taking  these facts  into consideration that the matter is  very old one  and  that   only a legal question  regrading  validity of   deduction of 25%  from   price of the land  is involved  in this case, we instead of  remanding the case  for  re-hearing chose to decide   it  on  merits. It may  also be pointed out  that  before the trial court  also no evidence was   led   by either  party i.e.  claimants as well as  the State Government.

9. Some additional evidence was  filed by  the parties in this appeal . The appellant filed  the following  documents :

(i)A copy of  declaration made by  Sri K.K.Upadhyay S.D.O. , Etawah  dated  5.7.1974 declaring  the disputed plots  no. 834, 835, 836, 837 and 838 area 2.40 acres  as Abadi  land ;

(ii) A copy of  the notification   under section 6 of the Act dated 15.6.76 for  acquisition of 33.87 acres of land;

(iii) A copy  of the possession  certificate dated 30.7.76 showing   delivery  of  33.87 acres  of land to  the Samiti ;

(iv)A copy of  possession certificate  dated 12.8.86 showing delivery of  an area of  1.50 Acres of land of plots no. 834, 835, 836, 837 and 838  to the Samiti;

(v) A copy of the award  dated 12.10.78 in respect of  33.87 acres of land; and

(vi) Copies of  the sale deeds dated 24th July,1982 executed by  Bishan Das claimant respondent no.1 in favour of  Pahloomal and Narain  Das  in respect of 0.02 acres of land  of plot no. 834  for consideration of Rs. 17380/- each.

These documents were  admitted  vide order  dated 22.11.03.

10. The contesting respondents were  provided  opportunity to file  documents  in rebuttal. They  filed  following documents:

(i)A   copy of the declaration made by  Sri K.K.Upadhyay, S.D.O. Etawah declaring 2.40 acres  of land of   the disputed plots no. 834, 835, 836, 837 and 838 as  Abadi  land ( already filed  by  appellant as  paper no.1);

(ii) A certified copy of the  map  showing the position of the aforesaid  plots on the spot.

(iii) A copy of  the G.O. No.  9/23/81/708 Ga-2 dated 6.7.1981 issued by the U.P. Government  providing  that in case of land acquisition,  if there are  several  sale deeds, the relevant  sale deed   which is of  the highest  value should be   taken for  fixing market value  of  the land.

(iv) A copy of the Circular  dated 20.11.82 issued by the  Collector  regarding fixation of circle rate   showing  that the  rate of the land adjacent to  Etawah-Farrukhabad road was between  Rs.15/- to  Rs.20/-per square feet.

11. It may  be  mentioned  that  the disputed plots no. 834, 835,  836, 837  and 838 are  situate  closely  adjacent to  Etawah- Farrukhabad road  as shown in the map (Paper no. 2 above).

12. We have  gone through these documents and have also  heard the learned counsel for the parties.

13. The  S.L.A.O.  observed  in his award:

(i)    that  174 sale deeds were executed  within a period     of one year  prior to the  date of  publication of   notification under  section 4(1) of the   Act and out of them  except the sale deed at serial   no. 37, 38, 61,173 and 174,   the remaining  sale deeds were of   these areas which were situate at a distance  from the disputed land and so they had no relevance;

(ii)   That the disputed land  was abadi land,  and the sale   deeds  at serial no. 37, 38 & 61 were  of agricultural land and so the valuation of the disputed land could not be assessed    on the basis of  these sale deeds.

(iii)  That  the sale deeds at serial nos. 173 and 174 had been executed by Bishan Das  claimant in respect of 0.02 acres of land each from plot no. 834  at the rate of  Rs. 20/- per square  feet within a period  of one month  prior  to  the date of  notification  under section 4(1) of the Act and so these two sale deeds could be  relied upon  for determining  the price of the disputed land.

(iv) That since the disputed land  has got building potential, the deduction of 25% should be made while  determining  the price of the acquired land.

He has, accordingly, fixed  the price of the land after  making above deduction.

14. The  above  deduction  was challenged in the  reference under section 18 of the Act; and  a Photostat copy of G.O. No. 117/10/L.A./288 dated 4.6.88 issued by the  Director of Land Acquisition  Directorate, Board of Revenue, U.P., Sec.10, Land Acquisition, Lucknow was  produced before  the Addl. District Judge  in which  it was  provided that  where  the area   of  acquired land   is less than  8 acres,  no deduction should be made from the  compensation assessed to the owners of the land. The Addl. District Judge   was of the view that  since in the present case, only an area of 1.50 acres of land  was acquired,  no  such deduction   was permissible,  and  the deduction of 25% in the price of  the land  made by   the S.L.A.O.  was not justified. He, therefore, passed  an order  setting aside the  above  deduction.

15. The learned counsel for the  appellant  made  the following submissions before us :

(i)that  the above notification is dated 4.6.88 and in the present case  the  notification under section 4 of the Act was made  on 26.4.82 and  the notification under section 6 of the Act was  made on 13.7.84 and award was also   given on 30.5.85 and so  the above notification  was not applicable  to the present case.

(ii) That  the above notification has  got  no legal sanctity  and  the law relating to  deductions in price of land  has been enunciated  in  large number of  rulings of  Hon'ble  Apex Court  and those rulings should have been followed by  the learned A.D.J.

(iii) That  the sale deeds relied upon by the S.L.A.O. for determining  the valuation of the land were  in respect of  very small pieces of land  comprising of  0.02 acres only,  and so in respect of the   area  of 1.50 acres,  which was    acquired, the order passed by the S.L.A.O.   for deduction of 25%  in the price of  the land  is completely justified  because there   is  always  a  difference  in the  rates  of small fractions of land  and of  larger area of land.

16.   In reply the learned counsel  for  the contesting respondents made  the following submissions:

(i)That the   principles laid down  in the aforesaid G.O. issued by  the Director of  Land acquisition are of general application;

(ii)That the disputed land is Abadi land situated adjacent to the public road  and so there was no question of  making any deduction  while  fixing its price.

17. Both  the parties   also cited  before us   several rulings of the  Hon'ble  Apex Court in support of their respective  contentions.

18. The learned counsel for the contesting  respondent  cited before us  the ruling of  Hon'ble Supreme Court  in Spl. Tehsildar , Land Acquisition  Vishakpatnam Vs.  A. Mangala  Gowri : AIR 1992 SC 666. In this case   acquisition of   5 acres 589-1/3 sq. yards  of   land  was  made. The collector  fixed  compensation  at the rate of Rs.1.58  per square yard . On reference   the Civil Court enhanced compensation  to  Rs.10 per square yard. The  appeal  and the  cross appeal filed before the High Court were dismissed. The Spl. Tahsildar Land Acquisition  filed appeal   before the Hon'ble Supreme Court. The  Hon'ble Supreme Court observed that  where the  acquired  land is in the midst of already developed  land  with amenities of roads, drainage, electricity etc. then  deduction of  1/3 would not be  justified . However,  looking to the facts of the case  the  Hon'ble Supreme Court was of the view that  the market  rate determined by  the civil court and the High Court  was  higher . It determined the market  value  at Rs. 6 per square yard  and  also made 1/3 deduction and,   in this way, the  market value  fixed  was  Rs. 4 per square  yard.

19. The next ruling  cited  by the learned counsel  for the respondent is  of Hon'ble  Apex Court  in Bhagwathula Samanna and others Vs.  Special Tahsildar and Land Acquisition  Officer: AIR 1992 SC 2298. In this case  there was   acquisition of  1.68 acres of land. The L.A.O.  had fixed  the price of the land at  0.88 paise per square yard. On a reference the civil court determined the  market  value of  the land  at  Rs. 10/-  per square  yard. The State Government  filed an appeal  against  that order . The High Court  accepted the above valuation  but made  a deduction of 1/3 of the  value   taking into consideration  this fact that a large   tract  of land  was being acquired  and so it  fixed the value   at Rs. 6.50 paise  per square yard and, accordingly, reduced the compensation. Aggrieved with that order  the claimant filed an appeal before Hon'ble  Supreme court . The Hon'ble  Apex Court  observed in paragraphs no. 7 and 8 of the judgment as follows:

"7. In awarding compensation  in acquisition proceedings, the Court has necessarily to determine the market value of the land as on the date of the relevant Notification . It is useful  to consider the value paid for similar land  at the material time under genuine transactions. The market value envisaged the  price which a willing purchaser may  pay  under bona fide transfer to a willing seller. The land  value can differ depending upon the  extent and nature  of the  land  sold. A fully developed small plot in an important locality may fetch a higher value than a larger area in an undeveloped condition and situated  in a  remote locality. By comparing the price shown in the transactions all variables have to  be taken into consideration. The transaction in  regard to  smaller property  cannot , therefore, be taken as  a real basis  for  fixing the  compensation for larger tracts of property . In  fixing the market value of a larger property on the basis of a sale transaction for smaller property, generally a deduction is given   taking into consideration  the  expenses required for development  of the larger tract to  make smaller plots within that area in order to  compare with the small plots  dealt with under the sale transaction. This principles has been  stated by this Court in Tribeni Devi's case (AIR 1972 SC 1417 )(supra).

8. In  Kaushalya Devi V. Land Acquisition Officer (1984)2 SCR 900: (AIR 1984 SC 892), this Court observed at pages 912-913 ( of SCR): ( at p. 898 of AIR) as under:

"When large tracts are acquired, the transaction in respect of  small properties do not  offer a proper guideline................ In certain other cases this Court indicated that for determining the market  value of a large property on the basis of  a sale transaction for smaller property a deduction should be given."


20. The Hon'ble  Supreme  Court was  of the view that  since   roads, drainage, electricity  and other amenities  were available  and no  other  development was required, there was no justification for making deduction  and it awarded  compensation  at the rate of 10  per square  yard.

21. Learned counsel for the  claimant respondent  also cited before us  another  ruling of Hon'ble  Apex  Court  in  Special Deputy  Collector and another Vs.  Kurra Sambasiva Rao and others: AIR 1997 SC 2625. In this case  an area of 97 Acre 42 cents of land was acquired. The L.A.O. awarded  compensation  at the rate of  Rs 22,940/- per acre  for levelled up  land and at  Rs. 21,700/- for unlevelled land.  On  reference  under section 18 of the Act  the civil court awarded  uniform compensation at  the rate of  Rs.100,000/- per  Acre. On appeal  by the claimants, the High Court  further enhanced the compensation to Rs. 23.50 per square yard,  then the matter   went before  the   Hon'ble Supreme court. Their Lordships observed in paragraphs no. 7 and 8  of the judgment as follows:

"7. Whether  fair and reasonable  and adequate  market value is always a question  of fact depends on the evidence adduced, circumstantial evidence, and probabilities arising in each case. The guiding star or the acid test would be  whether  a  hypothetical willing  vendor would offer the lands and a willing  purchaser in 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 the notification under section 4(1) of the Act; but  not an anxious buyer dealing  at arm's  length with throw  away price, nor facade of  sale or  fictitious  sales brought about  in quick succession or otherwise  to inflate the market value. The judge  should sit in the arm chair of the   said 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  court is, therefore,  enjoined with the  bounden  duty of public  function  and judicial dispensation  in determination of the market value of the acquire land and compulsory  acquisition.

8. The best evidence  of the value of property are the  sale transaction in respect of  the acquired land to which the claimant himself is a party;  the  time  at which  the property comes to be sold: the purpose  for  which it is sold; nature of the consideration;  and the  manner in which the  transaction came to be brought out. They  are  all  relevant factors. In the absence of such a sale  deed relating to the acquired land, the sale  transactions relating to the  neighbouring lands in the  vicinity  of the acquired land. In that case,  the features required to be present  are; it must be within a reasonable time of the date  of  the notification ;  it must be  a bona fide transaction; it should be  a sale of land  similar to the land  acquired or land adjacent to the land acquired; and it should possess similar  advantageous  features. These are relevant  features to be taken  into consideration to prove the market  value of  the acquired land as on the date of the notification published  under Section 4(1) of the Act."

22. In this case the Hon'ble Supreme Court  was of the  view that  the amount of  compensation  fixed  by the civil court as well as   by High Court was excessive and it reduced the  price of the land to Rs. 50000/-  per   acre.

23. The learned counsel of the appellant on the other hand produced before us certified copy of a ruling of Hon'ble Apex Court in Civil Appeal No. NIL of 1990 ( arising out of S.L.P.(C) Nos. 8251-53/90- and 12639-41/90), Krishi Utpadan Mandi Samiti, Nazibabad, Bijnor Vs. Ajay Kumar and others etc. etc.' decided on 11.12.1990. In this case also a piece of land was acquired for Mandi Samiti and the land in question was fit for Abadi and it was within the municipal limits of Nazibabad. The Addl. District Judge had fixed the price of land in question at Rs.40/- per square yard. On appeal, this Court confirmed the order of the Addl. District Judge. However, no deduction was made in respect of the development charges. The Hon'ble Apex Court  was of the view that taking into consideration the above facts the development charges at the rate of 25% should have been deducted from the total amount of compensation. So the Hon'ble Apex Court passed an order for making deduction at the rate of 25% from the principal sum awarded  as compensation and modified the order  passed by the courts below.

24 The learned counsel for the appellant  cited before us another ruling of the Hon'ble Apex Court in 'The Land Acquisition Officer Vs. Nookala Rajamallu and others' reported in  J.T. 2003 (9) SC 433. In this case 11.33 acres  of land were acquired and the Land Acquisition  Officer fixed  market value of the aforesaid land  at the rate of Rs.12,325/-per acre. The claimants were not satisfied with the amount of compensation and they sought for reference under section 18 of the Act.  The  reference court fixed  the rate of compensation at Rs.10/- per square yard. The claimants were still not satisfied and so  they filed an appeal before Andhra Pradesh High Court and the High Court  relying upon the sale deed in which rate of consideration was Rs.82/- per square yard, and after making 1/3rd deduction for development charges, fixed the market rate  of this land at Rs.55/- per square yard. In an  appeal filed against the order of the High Court the Hon'ble Supreme Court made the following observations in paras 6, 7, 8, 9 and 10 of the  judgment:

"6. Where large area is the subject matter of acquisition,     rate  at   which small plots are sold cannot be said to be   safe   criteria. Reference in this context  may be made to   few decisions of this Court in The Collector of Lakhimpur V. Bhuban Chandra Dutta1, Prithvi Raj Taneja  (dead ) by Lrs. V. The State of Madhya   Pradesh and Anr2.  and  Smt. Kaushalya Devi Bogra and Ors. etc. V. Land Acquisition Officer, Aurangabad and Anr3.

7.  It cannot, however, be laid down as an absolute proposition that   the rates fixed for the small plots cannot be the basis for   fixation of the rate. For example, where there is no other material it may in appropriate cases be open to the adjudicating court  to make comparison  of the prices paid for small  plots of land. However, in such  cases necessary deductions/adjustments have to be made while determining the prices. (Emphasis supplied by us).

 8.  In the case of Suresh Kumar V. Town Improvement Trust, Bhopal1 in a  case under the Madhya Pradesh Town Improvement Trust Act, 1960 this Court held that the rates paid for small parcels of land do not provide a useful guide for determining the market value of the land acquired. While determining the market value of the land acquired it has to be correctly determined and paid so that there is neither unjust enrichment on the part of  the acquirer nor undue deprivation on the part of the owner. It is an accepted principle as laid down in the case of Vyricherla Narayana Gajapatiraju V. Revenue Divisional Officer, Vizapatam2 that the compensation must be determined by reference to the price which a willing vendor   might reasonably expect  to receive from the willing purchaser. While considering the market value disinclination of the vendor to part with his land and the urgent necessity of the purchaser to buy it must alike be disregarded. Neither must be considered as acting under  any compulsion. The value of the land is not to be estimated as its value to the purchaser. But similarly this does not mean that the fact that some particular purchaser might desire the land more than others is to be disregarded. The wish of a particular purchaser, though not his compulsion may always be taken into consideration for what it is worth. Section 23 of the Act enumerates the matters to be considered in determining compensation. The first criteria to be taken into consideration is the market value of the land on the date of the publication of the notification under section 4 (1). Similarly, section 24 of the Act enumerates the matters which the court shall not take into consideration in determining the compensation. A safeguard is provided in section 25 of the Act that the amount of compensation to be awarded by the court shall not be less than the amount awarded by the Collector under section 11. Value of the potentiality is to be determined on such  materials as are available and without indulgence in any fits of imagination. Impracticability of determining the potential value is writ large in almost all cases. There is bound to be some amount of guess work involved while determining the potentiality.

9. It can be broadly stated that the element of speculation is reduced to minimum if the underlying principles of fixation of market value with reference to comparable sales are made:

(i) when sale is within a reasonable time of  the date of   notification under section 4(1);

(ii)  it should be a bona fide transaction;

(iii) it should be of the land acquired or of the land adjacent to the land acquired;and

(iv)it should possess similar advantages.

10.   It is only when these factors are present, it can merit a   consideration as a comparable case ( See The Special Land Acquisition Officer, Banglore V. T. Adinarayan  Setty).1"

25. The Hon'ble Apex Court  further observed that in the Building Rules 53% of the land is required to be left out and the  Court has laid as a general rule that for laying the roads ands other amenities 33-1/3% is required to be deducted. In this case Hon'ble Apex Court made deduction at the rate of 53% from the value disclosed in the sale deed relied upon by the High Court and fixed market rate  of the acquired land at Rs.40/- per square yard.

26. The learned counsel for the appellant also cited before us another ruling of the Hon'ble Apex Court  in 'V. Hanumantha Reddy Vs. Land Acquisition Officer and Mandal R. Officer' reported in 2004 (54)  ALR 141(S.C.). In this case a chunk of land measuring 5.39 acres was acquired and the Land Acquisition Officer  fixed market  value of the land at Rs.45,000/- per acre, equivalent to Rs.10/- per square yard. The claimant prayed for a reference under section 18 of the Land Acquisition Act and the Civil Judge determined the market value of the land at Rs. 78/- per square yard  and after allowing deduction of 1/4th for developmental purposes, arrived at Rs.58/- per square yard as net payable. Aggrieved with  his order the claimants as well as the Land Acquisition officer filed  appeals before the High Court. The High Court dismissed the appeal filed  by the claimants and partly allowed the appeal filed by the Land Acquisition Officer  and fixed the market value at the rate of Rs.45/- per square yard and after making 1/3rd deduction for developmental purposes determined the value  of the acquired land at Rs.30/- per square yard for consideration of the amount of compensation. The Hon'ble Apex Court  held that the order passed by the High Court  was completely justified.

27. The learned counsel for the appellant also cited before us a Division Bench ruling of this Court in 'Allahabad Development Authority , Allahabad Vs. Shakeel Ahmad and others' reported in 2004 (2) AWC 986. In this case 5 Bighas 11 Biswas land was acquired  and the Reference Court  had fixed  the rate of compensation at Rs.115/- per square meter,i.e. Rs.2,60,000/-per Bigha. In an appeal filed by the Allahabad Development Authority it was argued  before the Court that the trial court  had relied upon the sale deeds  of small piece of land in which the land was sold at the rate of square meter and this rate could not be applicable where a larger area of land was acquired. While considering this contention their Lordships referred to the following observations of Hon'ble Apex Court  in 'Collector  of Lakhimpur V. Bhuban Chandra Duta' AIR 1971 SC 2015:

"In our opinion the High Court overlooked the fact that the  plots which were subject-matter of sale deeds Exhibits -1 to 4 were comparatively of small areas and it is like the one which was the subject-matter of acquisition has to  be sold it cannot possibly fetch a price at the same rate at which small plots can be sold."

28. It may be mentioned that in this case market rate as mentioned in the  exemplar was Rs.224/- per square meter and this Court reduced  it to half  for assessing the market value of the acquired land and held  that the market rate of the acquired land could be determined at Rs.112/- per square meter.

29. Then this Court considered the matter of deduction of development charges and relied upon  the following observations of Hon'ble Apex Court in 'Basant Kumar Vs. Union of India  and another' 1996 (11) SCC 542:

"........It is settled legal position that if the land is already developed then what has to be seen is the nature of development and money expanded by the developer and as to what was the market value prevailing on that  basis as on the date of notification, and what was the situation of the acquired land on that date: all these and other relevant facts have to be taken into consideration and then market value should be determined. Merely  Because a land is developed or developing land, it would not be that same compensation is to be adopted to determine the market value for the entire land as a developed land. If it is to be developed, it is a settled legal position that at least 1/3rd of the compensation has to be deducted towards providing amenities, like roads, parks, electricity, sewage, water facilities etc. This Court had upheld deduction of even 60% towards development charges......"

30. It may be mentioned that in the above ruling Hon'ble Apex Court  had observed that deduction can be made even in those cases where  the land is developed and relying upon the above observations this Court made  further deduction of 1/3rd towards development cost and fixed the market rate  of the acquired land at Rs.80/- per square meter.

31. It becomes clear from perusal of the aforesaid rulings cited by both the parties that in most of the cases suitable deductions have been made in fixation of market value of the acquired land where larger area of land was acquired and no suitable sale deed of large area of  land  was available and reliance had to be placed  on the sale deeds of small piece of land. Suitable deductions were also made for developmental purposes.

32. In the present case,  the position is that 1½  acres of land which is situated in Quasba  Etawah  closely adjacent to Etawah Farrukhabad road has been acquired. This land was originally proposed to be acquired in the notification dated 4.6.1976 issued under section 4 of the Act  and was the part of 33.87 Acres of land which was being acquired for  Krishi Utpadan Mandi Samiti, Etawah. This land was included in the award of of Special Land Acquisition Officer dated 12.10.1978. The compensation of this entire land measuring 33.87 acres was assessed at Rs.3,19,888.79P. by the Special Land Acquisition officer vide order dated 12.10.1978. The respondent no.1 Bishan Das filed writ petition no. 9035 of 1978 against the above award and this Court vide its judgment dated 4.11.1980 set aside the award  against the claimants' land situated in plots no. 834, 835, 836, 837 and 838 on the ground that no opportunity of hearing  was provided to the petitioner, and quashed the notification dated 24.8.1978 under section 6 of the Act. Thereafter  the claimant Bishan Das executed two sale deeds of two decimals land each situated in plot no. 834 in favour of Pahalu Mal and Narayan Dass on 24.7.1982 for Rs.17,380/- at the rate of Rs.20/- per square feet. It may be mentioned that a fresh notification under section 4 of the Land Acquisition Act  for acquisition of 1.50 acres of land of plots no. 834, 835, 836, 837 and 838 was issued on 26.4.1982 and its last  publication was made on 21.8.1982. It was submitted by the learned counsel for the appellant that these two sale deeds for two decimals of land  were collusively  executed  by Bishan Das in favour of the above named vendees after issue of notification under section 4 of the Act on 26.4.1982 with a view to present them as exemplars for obtaining  high price of the acquired land and this rate is even higher than the circle rate of the land adjacent to Etawah Farrukhabad road which was fixed at Rs.15 to 20 per square feet by the Collector, Etawah on 20.11.1982. His contention was that the circle  rate  must have been lesser in July, 1982 when the above two sale deeds were executed by  Bishan Das. Even if  the above contention of collusive sale deeds is not accepted. for want of any direct evidence on the point, it is to be seen that when the aforesaid two sale deeds  of small fractions of land of two decimals at the rate of Rs.20/- per square feet were being relied upon by  the Special Land Acquisition officer for determination of the prices of one  & half  acres of land, his act of making 25% deduction in the price taking into  consideration the larger area  of the  acquired  land as compared to  two decimals of land  sold vide aforesaid sale deeds at the rate of Rs.20/- per square feet as well as the legal requirement of making deduction for developmental purposes cannot be termed to be illegal and it was justified  in view of the facts and circumstances of the  case. The Addl. District Judge  fell in error by passing an order for setting aside the  aforesaid deduction at the rate of  25%.

33. The appeal in this way deserves to be allowed and the judgment and decree passed by the court below, whereby it  had awarded  a sum of Rs.5,58,897.97P. as additional compensation alongwith interest thereon is liable to be set aside. Th e Addl. District Judge had also passed an order on 28.3.1989  in Civil Misc. Review Application no.19 of 1988 making some amendments in the rate and period of interest on the above amount. However, since the appeal is being allowed and no additional amount is payable to the claimants as compensation, the question of payment  of any interest on that amount does not arise and so the order passed by him on the review application is also liable to be set aside.

34. The appeal is accordingly allowed with costs and the judgment and decree dated 19.11.1988 of the court below passed  in L.A. Reference no. 76 of  1986, Bishan Das and others Vs.  State of U.P., and  the order dated  28.3.1989 passed in Civil Misc. Review Application no. 19 of 1988 are hereby set aside and the above L.A. Reference and the review application are dismissed  with costs.





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