The Sub Collector Mannargudi v. The Executive Officer, Arulmigu Vedaranyeswarasamy Devasthanam, Vedaranyam

IN THE HIGH COURT OF JUDICATURE OF MADRASDATED: 08.07.2008CORAM:THE HONOURABLE MR. JUSTICE G.RAJASURIAA.S.No.640 of 1995The Sub CollectorMannargudi ... Appellant / Referring OfficerVs. The Executive Officer,Arulmigu Vedaranyeswarasamy Devasthanam, Vedaranyam ... Respondent / Claimant Appeal filed u/s 54 of the Land Acquistition Act against thejudgment and decree of the learned Subordinate Judge ofNagapattinam and made in LAOP No.15 of 1983 dated 14.07.1994.For appellant :: Mr.V.Ravi Special Government Pleader (AS) For respondent :: Mr.S.K.Rakhunathan JUDGMENT This appeal by the Land Acquisition Officer is focussed asagainst the judgment and decree dated 14.07.1994 passed by thelearned Subordinate Judge of Nagapattinam in LAOP No.15 of 1983.For convenience sake, the parties are referred to here underaccording to their litigative status before the trial Court.2. Heard the learned counsel appearing for the parties.3. The nutshell of facts which are absolutely necessary andgermane for the disposal of this appeal would run thus:The Government published Notification under Section 4(1) ofthe Land Acquisition Act on 19.09.1979 for acquiring a vast extentof land in S.Nos.170 to 187, 220 to 278 and 344 to 351 inKodiakkarai Village, for the purpose of dedicating that area https://hcservices.ecourts.gov.in/hcservices/ towards birds sanctuary. After complying with the procedures, theLand Acquisition Officer acquired the lands concerned and assessedthe compensation in a sum of of Rs.4/- per cent. Being aggrievedby such awarding of the compensation, the land owner got the matterreferred to the Sub Court under Section 18 of the Land AcquisitionAct.4. During enquiry before the Sub Court, on the side of theclaimant, C.Ws.1 and 2 were examined and Exs.C1 to C3 were marked.On the side of the respondent, D.Ws.1 and 2 were examined andExs.B1 and B2 were marked.5. Ultimately, the Sub Court enhanced the compensation fromRs.4/- per cent to Rs.8/- per cent.6. Being aggrieved by such enhancement, the Land AcquisitionOfficer preferred this appeal on various grounds, the quintessenceof them would run thus:The Sub Court simply enhanced the compensation withoutconsidering the fact that Ex.C.3 the sale deed emerged afterSection 4(1) notification and it refers to a land of a differentnature from one acquired by the Government, in addition to thefact that it is also far off from the land acquired. Accordingly,the learned Special Government Pleader prayed for setting aside thejudgment and decree passed by the Sub Court.7. The point for consideration is as to whether the Sub Courtwas justified in enhancing the compensation from Rs.4/- to Rs.8/-per cent and that too based on Ex.C.3 the sale deed which emergedsubsequent to Section 4(1) notification published by theGovernment.8. The learned Special Government Pleader (AS) submitted hisargument by way of reiterating the grounds of appeal, whereas, thelearned counsel for the land owner would advance his argument tothe effect that there was nothing wrong in relying upon Ex.C.3 -the sale deed dated 31.10.1979 which emerged subsequent to Section4(1) notification as in that locality no sale deeds emerged as theyare emerging in other cases.9. The whole kit and caboodle of facts and figures placedbefore the Sub Court would clearly indicate and highlight that thearea acquired is near the sea and does not have the potentiality ofbecoming habitation area also. The Government intended the saidarea to be dedicated as a birds sanctuary. Hence, in such a case,from the available materials, the Court has to fix thecompensation. Ex.C.3 dated 31.10.1978 is more than a month afterthe emergence of publication of Section 4(1) notification, on19.09.1979 and it is quite obvious. https://hcservices.ecourts.gov.in/hcservices/

10. The learned counsel for the land owner placed reliance onthe decision of the Hon'ble Apex Court reported in U.J.(S.C.)1988(2) [Chimanlal Hargovinddas vs. The Special Land AcquisitionOfficer, Poona and another] and developed his argument that evensale deeds which emerged after section 4(1) notification could berelied on. In this regard, he would rely upon the followingexcerpt. "4. The following factors must be etched on themental screen:-(1) A reference under section 18 of the LandAcquisition Act is not an appeal against the award and theCourt cannot take into account the material relied upon bythe Land Acquisition Officer in his Award unless the samematerial is produced and proved before the Court.(2) So also the Award of the Land Acquisition Officeris not to be treated as a judgment of the trial Court openor exposed to challenge before the Court hearing theReference. It is merely an officer made by the LandAcquisition Offices and the material utilised by him formaking his valuation cannot be utilised by the Courtunless produced and proved before it. It is not thefunction of the Court to sit in appeal against the Award,approve or disapprove its reasoning, or correct its erroror affirm, modify or reverse the conclusion reached by theLand Acquisition Officer, as if it were an appellateCourt.(3) The Court has to treat the reference as anoriginal proceeding before it and determine the marketvalue afresh on the basis of the material produced beforeit.(4) The claimant is in the position of a plaintiffwho has to show that the price offered for his land in theaward is inadequate on the basis of the materials producedin the Court. Of course the materials placed and provedby the other side can also be taken into account for thispurpose.(5) The market value of land under acquisition has tobe determined as on the crucial date of publication of themodification under section 4 of the Land Acquisition Act(dates of Notifications under secs. 6 and 9 areirrelevant). https://hcservices.ecourts.gov.in/hcservices/ (6) The determination has to be made standing on thedate line of valuation (date of publication ornotification under sec.4) as if the valuer is ahypothetical purchaser willing to purchase land from theopen market and is prepared to pay a reasonable price ason that day. It has also to be assumed that the vendor iswilling to sell the land at a reasonable price.(7) In doing so by the instances method, the Courthas to correlate the market value reflected in the mostcomparable instance which provide the index of marketvalue.(8) Only genuine instances have to be taken intoaccount. (Some times instances are rigged up inanticipation of Acquisition of land).(9) Even post notification instances can be takeninto account (1) if they are very proximate (2) genuineand (3) the acquisition itself has not motivated thepurchaser to pay a higher price on account of theresultant improvement in development prospects,(10) The most comparable instances out of the genuineinstances have to be identified on the followingconsiderations:-(i) proximity from time angle.(ii) proximity from situation angle.(11) Having identified the instances which providethe index of market value the price reflected therein maybe taken as the norm and the market value of the landunder acquisition may be deduced by making suitableadjustments for the plus and minus factors vis-a-vis landunder acquisition by placing the two in juxtaposition.(12) A balance-sheet of plus and minus factors may bedrawn for this purpose and the relevant factors may beevaluated in terms of price variation as prudent purchaserwould do.(13) The market value of the land under acquisitionhas thereafter to be deduced by loading the pricereflected in the instance taken as norm for plus factorsand unloading it for minus factors.(14) The exercise indicated in clauses (11) to (13)has to be undertaken in a common sense manner as a prudentman of the world of business would do. We may illustrate https://hcservices.ecourts.gov.in/hcservices/ some such illustrative (not exhaustive) factors:-Plus factors Minus factors1. Smallness of size1. largeness of size.2. proximity to a road2. situation in the interior at a distance from the road 3. frontage on a road3. narrow strip of land withvery small frontage comprised to depth 4. nearness to developed 4. lower level requiring thearea depressed portion to be filled up 5. regular shape5. remoteness from developed locality 6. level vis-a-vis land 6. some special disadvantageous acquisition factor which would deter a purchaser 7. special value for an owner of an adjoining property to whom it may have some very special advantage (15) The evaluation of these factors of coursedepends on the facts of each case. There cannot be anyhard and fast or rigid rule. Common sense is the best andmost reliable guide. For instance take the factorregarding the size. A building plot of land say 500 to1000 sq.yds. cannot be compared with a large tract orblock of land of say 10000 sq.yds. or more. Firstly whilea smaller plot is within the reach of many, a large blockof land will have to be developed by preparing a lay out,carving out roads, leaving open space, plotting outsmaller plots, waiting for purchasers (meanwhile theinvested money will be blocked up) and the hazards of anentrepreneur. The factor can be discounted by making adeduction by way of an allowance at an appropriate rateranging approx. between 20% to 50% to account for landrequired to be set apart for carving out lands andplotting out small plots. The discounting will someextent also depend on whether it is a rural area or urban https://hcservices.ecourts.gov.in/hcservices/ area, whether building activity is picking up, and whetherwaiting period during which the capital of theentrepreneur would be locked up, will be longer or shorterand the attendants hazards.(16) Every case must be dealt with on its own factpattern bearing in mind all these factors as a prudentpurchaser of land in which position the Judge must placehimself.(17) These are general guidelines to be applied withunderstanding informed with common sense."11. I am of the considered opinion that the recent decision ofthe Hon'ble Apex Court reported in (2008)1 SCC 554 [LucknowDevelopment Authority vs. Krishna Gopal Lahoti and others] could beextracted here under:"16(9). It can be broadly stated that the element ofspeculation is reduced to a minimum if the underlyingprinciples of fixation of market value with reference tocomparable sales are made:(i) when sale is within a reasonable time of thedate of notification under Section 4(1);(ii) it should be a bona fide transaction;(iii)it should be of the land acquired or of theland adjacent to the land acquired; and(iv) it should possess similar advantages."(emphasis supplied)12. As such it is clear that the Hon'ble Apex Court's latestdecision in this regard is on the line that sale deeds whichemerged subsequent to Section 4(1) notification should not berelied on and even sale deeds which emerged shortly before suchpublication also should not be relied on. Over and above thatthere is one other crucial point to be noted. Ex.C.1 refers to aland in R.S.No.43, which is admittedly situated far away from theland acquired also. Hence I am of the opinion that the Sub Courtwas not justified in placing reliance on Ex.C.3 and in awardinghigher compensation of Rs.8/- per cent.13. Then the core question arises as to what should be thejust compensation in the facts and circumstances of the case.Exs.C1 and C2 sale deeds dated 16.04.1978 and 22.04.1979 refer toSurvey Numbers which are relating to habitation area. But https://hcservices.ecourts.gov.in/hcservices/ undoubtedly and indubitably, the land acquired is not an habitationarea and there is no prospects of such area becoming an habitationarea also and the Government correctly decided to dedicate thatarea as bird sanctuary. The Land Acquisition Officer, from thedata collected by him relied on Ex.B.2 sale deed dated 09.03.1976relating to S.Nos.146/9, 146/10 and 153/2 and it is evident thatthe value of per cent was Rs.4/-. The learned counsel for the landowner would correctly argue that even assuming that such a documenthas to be relied on, then it has to be seen that 3/1-2 yearsanterior to Section 4(1) notification such a document emerged andover the said period of 3-1/2 years, there might have been increasein valuation. 14. My mind is redolent with the one other decision of theHon'ble Supreme Court as cited infra to the effect that for eachyear 10% increase could be given so as to arrive at a justcompensation.(2004) 6 SCC 533 [Delhi Development Authority vs. Bali Ram Sharmaand others]. An excerpt from it would run thus:"6. The lands which are the subject-matter of theseappeals are acquired for the same purpose as in theaforementioned appeals, but the notification underSection 4(1) of the Act was issued on 25.2.1981 i.e.subsequent to Section 4(1) notification dated 17.11.1980.Obviously, there would be escalation of prices in regardto these lands. Hence, we think it just and appropriateto give 5% increase in the market value in respect of thelands in these appeals. In the result these appeals arealso allowed and the impugned judgments are modified byreducing the amount of compensation from Rs.345 per sqyard (amounting to Rs.3,45,000 per bigha) to Rs.76,55 perbigha + 5% escalation. The respondents are entitled tostatutory benefits available under the Act based on theamount of compensation as modified above. No costs.Civil Appeal No.4157 of 20037. The land which is the subject-matter of thisappeal is acquired for the purpose as in theaforementioned appeals, but the notification underSection 4(1) of the Act was issued on 24.11.1981 i.e.subsequent to Section 4(1) notification dated 17.11.1980.Obviously, there would be escalation of price in regardto this land. Hence, we think it just and appropriate togive 10% increase in the market value in respect of theland in this appeal. In the result this appeal isallowed and the impugned judgment is modified by reducingthe amount of compensation from Rs.345 per sq yard(amounting to Rs.3,45,000 per bigha) to Rs.76,550 perbigha + 10% escalation. The respondent is entitled tostatutory benefits available under the Act based on the https://hcservices.ecourts.gov.in/hcservices/ amount of compensation as modified above. No costs."15. As such, from a mere perusal of the cited excerpt it isclear that in this case four times increase at the rate of 10%could be given and it comes to Rs.5.85p per cent and taking intoconsideration the facts that a vast extent of land is dedicatedtowards birds sanctuary; readily clinching documents are notavailable to prove the actual market value; and the interest of theland owner being a public temple should be protected, the sum ofRs.5.85p could be rounded to Rs.6/- per cent and accordingly, thetotal compensation should be calculated. 16. Relating to development charges, no doubt the normal ruleis 1/3rd deduction and in certain cases, it could be even 20%. Buthere it is a peculiar case where the entire area is dedicated asbirds sanctuary. As such, the ecology has to be maintained andfrom that angle if viewed, I am of the considered opinion, nodeduction towards development charges should be made. Thefollowing are the few decisions of the Hon'ble Apex Court:(1) AIR (2007) Supreme Court 740 [Deputy Director, Land Acquisition vs. Malla Atchinaidu](2) (2003) 4 SCC 481 [Ravinder Narain and another vs. Union of India](3) (2007) 9 SCC 447 [Nelson Fernandes and others vs. Special Land Acquisition Officer, South Goa and others](4) (2008) 1 SCC 554 [Lucknow Development Authority vs. Krishna Gopal Lahoti and others](5) (1996) 9 SCC 640 [Basavva (smt) and others vs. Special Land Acquisition Officer and others]17. The above said judgments are relating to the landsacquired for habitation purpose, for industrial purpose, for layingroads etc. and not for any purpose as referred to in this case. Assuch, I am of the view that no amount need to be deducted towardsdevelopment charges. Accordingly, the point is answered. 18. The learned counsel for the land owner also made anextempore submission to the effect that solatium awarded was only15% and the interest awarded by the Sub Court also was not correct.The learned Special Government Pleader would in all fairness submitthat the current rate of 30% solatium with interest would beapplicable to this case. In fact, Section 4(1) notification waspublished on 19.09.1979 and the award was passed on 27.09.1982.The learned Special Government Pleader would clarify the legal https://hcservices.ecourts.gov.in/hcservices/ position that it is a settled proposition of law that relating suchcases the benefit of the said Land Acquisition (amended) Act 68 of1984 could be given. The five Bench decisions of the Hon'ble ApexCourt reported in 1989 (2) SCC 754 [Union of India vs. Raghu birSingh) and in 1994(5)SCC 593 [K.S.Paripoornam vs. State of Kerala]would highlight the legal position as put forth by the learnedSpecial Government Pleader.19. In the result, the judgment and decree of the Sub Courtis modified and the enhanced compensation of Rs.8/- per cent isreduced to Rs.6/- per cent. The land owner is also entitled to allbenefits as per the Land Acquisition (amended) Act 68 of 1984. 20. Accordingly, this appeal is allowed in part and theclaimant is entitled to other statutory benefits as per law. Nocosts.Sd/-Asst. Registrar./true copy/Sub Asst. Registrar.To1. The Subordinate Judge, Nagapattinam.Copy toThe Section OfficerVR Section,High Court, Madras.1 cc to Mr.s.K. Rakhunathan, Advocate, sR. 357161 cc to Government Pleader, sR. 35706A.S.No.640 of 1995VSV (CO)kk 1/8