The Special Tahsildar (LA),Adi Dravidar Welfare, Rangasamudram,Sathiyamangalam v. Subramaniamrep.by general Power AgentRanjana

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 14.3.2011Coram:THE HONOURABLE MR.JUSTICE G.RAJASURIAS.A.601 of 2006The Special Tahsildar (LA),Adi Dravidar Welfare, Rangasamudram,Sathiyamangalam Taluk,Erode District... Appellant/Land AcquisitionOfficer vs.Subramaniamrep.by general Power AgentRanjana... Respondent /ClaimantSecond appeal is preferred against the judgment and decree dated28.9.2004 passed by the Principal Sub Court, Gobichettipalayam inL.A.C.M.A.No.16 of 2001 modifying the award dated 23.3.2001 passedby the Special Tahsildar (Adi Dravidar Welfare) Sathiyamangalam inAward No.11/2000-2001. For Appellant : Mrs.R.Revathi,G.A.(CS)For Respondent : Mr.N.ManokaranJUDGMENTThis second appeal is focussed against the judgment and decreedated 28.9.2004 passed by the Principal Sub Court, Gobichettipalayamin L.A.C.M.A.No.16 of 2001 modifying the award dated 23.3.2001passed by the Special Tahsildar (Adi Dravidar Welfare)Sathiyamangalam in Award No.11/2000-2001. 2. The parties, for the sake of convenience, are referred tohere under according to their litigative status before the trialCourt.3. Heard the learned counsel appearing for the parties.4. The nut-shell facts, which are absolutely necessary andgermane for the disposal of this appeal would run thus:The Government vide Notification dated 3.11.2000 made underSection 4(1) of the Land Acquisition Act, intended to acquire theland belonging to the respondent/claimant/land owner, measuring an https://hcservices.ecourts.gov.in/hcservices/ extent of 0.40.5 hecters in Survey No.391/1, Nallur Village, forthe purpose of providing house plots to the landless Harijan people.After complying with the procedures, the Land Acquisition Officer inthe process of acquiring the land passed the award dated 23.3.2001assessing the compensation in a sum of Rs.60,215/- per acre andaccordingly assessed the rate for the land concerned in a sum ofRs.69,247/-.5. Being aggrieved by such quantification of the compensation,the land owner preferred the appeal before the Sub Court, seekingenhancement of compensation in a sum of Rs.9,86,885/-.6. During enquiry, before the Sub Court the power agent of theclaimant examined herself as P.W.1 and Ex.C1 and Ex.C2 were marked.On the side of the respondent, the land Acquisition Officer oneArumugam was examined as RW1 and Ex.R1 to Ex.R12 were marked. 7. Ultimately the Sub Court, after conducting enquiry, enhancedthe compensation and awarded at the rate of Rs.5,00,000/- per acre,in addition to the other statutory entitlements to which theclaimant/land owner is eligible. In fact, the advaloram Court feealso was not collected by the appellate Court, despite this Courtissued direction in that regard. 8. Now this second appeal is by the Government as against theenhancement of compensation awarded by the appellate authority andalso as against the non-collection of advalorem Court fee by theappellate authority concerned, on various grounds, inter alia thus:(i) The lower appellate Court, without any rhyme or reasonsimply enhanced the compensation multiple times and arrived at thefigure as Rs.5,00,000/- per acre.(ii)The alleged exemplar document-ExC2 dated 6.12.1999 wasrelating to a small extent and it cannot be taken as the guidelinefor enhancing the compensation.9. Accordingly, the following substantial questions of law arefound suggested in the memorandum of grounds of appeal:"a) Whether the Court below had erred in placingreliance on Ex.A1 and A2 where under a small extent of landclassified as house site were conveyed where as the landacquired is classified as agricultural land and measuring anextent of 0.40.5 hectars?b) Whether the reliance placed by the Court below onEx.A1 and A2 is not in contravention of the judgement of theApex Court reported in AIR 1995(5) SCC 426 whereunder theApex Court has prescribed the guideline that small extent ofland cannot be relied upon, for determination ofcompensation for large extent of land? https://hcservices.ecourts.gov.in/hcservices/ c) Whether the Court below had erred in not makingnecessary deduction towards development charges especiallyin view of law laid down by the Apex Court judgementreported in 2003(12) SCC 334 where under the Apex Courtprescribed the percentage of deduction at 53%?d) Whether the Court below had erred in notappreciating the provision of Section 8 of the Act 31/78which clearly stipulate that nature and classification ofland under acquisition as on date of 4(1) Notification isthe criteria for fixation of market value and not theprobable usage of the said land?e) Whether the court below had failed to appreciatethat the respondent/claimant ought to have paid advolerumcourt fee as prescribed under Section 51 of the Tamil NaduCourt Fee and Suits Valuation Act 1955 and not a nominal feeunder Section 3(1)(B) of Schedule II of the said Act?(extracted as such)10. My learned predecessor adopted as such the substantialquestions of law found suggested in the memorandum of grounds ofsecond appeal.11. Substantial questions of law (i) to (iv): All thesesubstantial questions of law are taken together for discussion, asthey are interwoven and interlinked, interconnected and entwined withone another.12. I recollect and call up the following decisions of theHonourable Apex Court:(i)(2010) 1 SUPREME COURT CASES 444 – SUBH RAM AND OTHERS V.STATE OF HARYANA AND ANOTHER, certain excerpts from it would run thus:"24. Deduction of “development cost” is the concept usedto derive the “wholesale price” of a large undeveloped landwith reference to the “retail price” of a small developedplot. The difference between the value of a small developedplot and the value of a large undeveloped land is the“development cost”. Two factors have a bearing on the quantum(or percentage) of deduction in the “retail price” asdevelopment cost. Firstly, the percentage of deduction isdecided with reference to the extent and nature ofdevelopment of the area/layout in which the small developedplot is situated. Secondly, the condition of the acquiredland as on the date of preliminary notification, whether itwas undeveloped, or partly developed, is considered andappropriate adjustment is made in the percentage of deductionto take note of the developed status of the acquired land.25. The percentage of deduction (development cost https://hcservices.ecourts.gov.in/hcservices/ factor) will be applied fully where the acquired land has nodevelopment. But where the acquired land can be considered tobe partly developed (say for example, having good road accessor having the amenity of electricity, water, etc.) then thedevelopment cost (that is, percentage of deduction) will bemodulated with reference to the extent of development of theacquired land as on the date of acquisition. But under nocircumstances, will the future use or purpose of acquisitionplay a role in determining the percentage of deductiontowards development cost. 27. Administrator General of W.B. v. Collector, Varanasi6contains a precise statement as to the concept of deductingdevelopment cost. This Court stated: (SCC p. 157, para12)“12. It is trite proposition that prices fetched for smallplots cannot form safe bases for valuation of large tracts ofland as the two are not comparable properties. … Theprinciple that evidence of market value of sales of small,developed plots is not a safe guide in valuing large extentsof land has to be understood in its proper perspective. Theprinciple requires that prices fetched for small developedplots cannot directly be adopted in valuing large extents.However, if it is shown that the large extent to be valued …is ripe for use for building purposes; that building lotsthat could be laid out on the land would be good sellingpropositions and that valuation on the basis of the method ofhypothetical layout could with justification be adopted, thenin valuing such small, laid out sites the valuation indicatedby sale of comparable small sites in the area at or about thetime of the notification would be relevant. In such a case,necessary deductions for the extent of land required for theformation of roads and other civil amenities; expenses ofdevelopment of the sites by laying out roads, drains, sewers,water and electricity lines, and the interest on the outlaysfor the period of deferment of the realisation of the price;the profits on the venture, etc. are to be made. In Brig.Sahib Singh Kalha v. Amritsar Improvement Trust7, this Courtindicated that deductions for land required for roads andother developmental expenses can, together, come up to asmuch as 53 per cent. But the prices fetched for small plotscannot directly be applied in the case of large areas, forthe reason that the former reflects the ‘retail’ price ofland and the latter the ‘wholesale’ price.”(emphasissupplied)This Court referred to and relied upon several earlierdecisions including three-Judge Bench decisions in MirzaNausherwan Khan v. Collector (LA)8 and Padma Uppal v. State of https://hcservices.ecourts.gov.in/hcservices/ Punjab."(ii) AIR 2010 SUPREME COURT 1754 – HARIDWAR DEVELOPMENTAUTHORITY HARIDWAR V. RAGHUBIR SINGH, etc., certain excerpts from itwould run thus:"9. The claimants do not dispute the appropriatenessof the said sale transaction taken as the basis fordetermination of compensation. Their grievance is that nodeduction or cut should have been effected in the pricedisclosed by the sale deed, for arriving at the marketvalue, in view of the following factors: (i) that theacquired lands were near to the main Bye-pass Road and hadroad access on two sides; (ii) that many residential houseshad already come up in the surrounding areas, and theentire area was already fast developing; and (iii) that theacquired land had the potential to be used an urbanresidential area. When the value of a large extent ofagricultural land has to be determined with reference tothe price fetched by sale of a small residential plot, itis necessary to make an appropriate deduction towards tomake an appropriate deduction towards the development cost,to arrive at the value of the large tract of land. Thededuction towards development cost may vary from 20% to 75%depending upon various factors (see: Lal Chand v. Union ofIndia, 2009(15) SCC 769): (AIR 2010 SC 170: 2009 AIR SCW5810). Even if the acquired lands have situationaladvantages, the minimum deduction from the market value ofa small Presidential plot, to arrive at the market value ofa larger agricultural land, is in the usual course, will bein the range of 20% to 25%. In this case, the Collectorhas himself adopted a 25% deduction which has been affirmedby the Reference Court and High Court. We therefore do notpropose to alter it."13. The learned counsel for the claimant/land owner cited thedecision of the Honourable Apex Court reported in (2010) 3 SUPREMECOURT CASES (CIV) 617 and (2010) 9 SUPREME COURT CASES 118, certainexcerpts from it would run thus:"16. In Rishi Pal Singh v. Meerut DevelopmentAuthority3 this Court while dealing with the issue relatingto a large tract of land held as follows: (SCC p. 207,para 5)“5. ... With respect to the first reason, that is, exemplarsof small plots have been taken into consideration by theReference Court, in the first instance our attention wasinvited to some judgments of this Court to urge that thereis no absolute bar to exemplars of small plots beingconsidered provided adequate discount is given in this https://hcservices.ecourts.gov.in/hcservices/ behalf. Thus there is no bar in law to exemplars of smallplots being considered. In an appropriate case, speciallywhen other relevant or material evidence is not available,such exemplars can be considered after making adequatediscount. This is a case in which appropriate exemplars arenot available. The Reference Court has made adequatediscount for taking the exemplars of small plots intoconsideration.”17. Furthermore, in Administrator General of W.B. v.Collector, Varanasi1 this Court has held: (SCC p. 157, para12)“12. It is trite proposition that prices fetched for smallplots cannot form safe bases for valuation of large tractsof land as the two are not comparable properties. Theprinciple that evidence of market value of sales of small,developed plots is not a safe guide in valuing large extentsof land has to be understood in its proper perspective. Theprinciple requires that prices fetched for small developedplots cannot directly be adopted in valuing large extents.However, if it is shown that the large extent to be valueddoes not admit of and is ripe for use for building purposes;that building lots that could be laid out on the land wouldbe good selling propositions and that valuation on the basisof the method of hypothetical layout could withjustification be adopted, then in valuing such small, laidout sites the valuation indicated by sale of comparablesmall sites in the area at or about the time of thenotification would be relevant. In such a case, necessarydeductions for the extent of land required for the formationof roads and other civic amenities; expenses of developmentof the sites by laying out roads, drains, sewers, water andelectricity lines, and the interest on the outlays for theperiod of deferment of the realisation of the price; theprofits on the venture, etc. are to be made.”18. The small area of land measuring 1710 sq ft wassold for `20,000 as per Ext. A-3 dated 15-7-1992 which worksout to a value of `11 per square foot. A comparison of thetwo plots, namely, land in Ext. A-3 and the acquired landshows that they are not identical. While the land in Ext. A-3 may not be an excellent guide it is still a better guidethan any other document exhibited on record. The same couldbe used as a relevant yardstick to assess the just andreasonable compensation in the present case.19. We find from the counter-affidavit filed by therespondent State that the said land covered by Ext. A-3 islocated out of the Municipal Corporation limit of Trichy,whereas the acquired land is located within the Municipal https://hcservices.ecourts.gov.in/hcservices/ Corporation limit of Trichy. Consequently, it cannot bedisputed that the acquired land, being in the heart of thecity and having excellent prospects of being used as aresidential site, definitely has an edge regarding thepotential value over the land covered by Ext. A-3."14. The learned counsel for the appellant cited the decision ofthe Honourable Apex Court reported in (2003) 12 SUPREME COURT CASES334 – LAND ACQUISITION OFFICER, KAMMARAPALY VILLAGE, NIZAMABADDISTRICT, A.P. VS. NOOKALA RAJAMALLU AND OTHERS, an excerpt from itwould run thus:"11. The evidence on record shows that the acquiredlands were agricultural lands. Obviously, their valuationwould differ to a considerable extent from the land used forhouse sites. In such a case, necessary deductions for theextent of land acquired for the formation of roads and othercivil amenities, expenses of development of the sites bylaying out roads, drains, sewers, water and electricitylines and the interest on the outlays for the period ofdeferment of the realisation of the price, the profits onthe venture, etc.are to be made. (See Administrator Generalof W.B.v.Collector, Varanasi (1988) 2 SCC 150). InBrig.Sahib Singh Kalha v. Amritsar Improvement Trust(1982) 1SCC 419) the deduction for such development was taken as53%."15. A perusal of all those decisions would indicate and connoteand demonstrate that the Court can take into account the futureprobable beneficial use, to which the party himself could put thatland into. In other words, the likelihood of the agricultural landbeing used for habitation purpose could rightly be taken into accountfor assessing the compensation.16. The learned counsel for the land owner would submit thataccording to the Honourable Apex Court's decision, the land ownersconcerned should taken as land losers and sympathetically their claimfor compensation has to be considered. According to the learnedcounsel for the land owner, even though, Ex.C2 is relating to a smallarea of land, for want of better exemplar that could be taken as thesample document and accordingly, the assessment made by the appellateauthority need not be interfered with and there is no perversity orillegality also. 17. Whereas, the learned Government Advocate would submit thatthe lower authority, without giving due deduction for the valuereferred to in the sample sale deed-Ex.C2, which is relating to asmall extent, simply took it as the proper value and made somedeductions, arbitrarily and arrived at a sum of Rs.5,00,000/- peracre. https://hcservices.ecourts.gov.in/hcservices/

18. No doubt, this is a case in which, the land acquisitionofficer referred to sample sale deeds, but those are all, in myopinion, not reflecting the true value for the reason that he tookinto account only the value of agricultural lands and the futurebeneficial use to which the property could be put into use by theowner himself was not taken into account.19. Indubitably and indisputably, incontrovertibly andungainsayably, the property acquired is very near to the habitationarea and for that matter, the land acquired is only for the purposeof converting that land into habitation area. Even though theHonourable Apex Court held that the Court need not take into accountthe use to which the Government might put it into use, yet in thesame judgement, the Honourable Apex Court observed that thepossibility of the owner himself putting that land into futurebeneficial use and earning profit should be considered. As such, forwant of better particulars as contemplated under the aforesaiddecisions, the sale deed Ex.C2 even though relating to a small extentcould be taken as an exemplar subject to off setting the price. Assuch, I am of the view that 20% should be deducted at the firstinstance towards off setting the price and as contemplated in thefollowing decisions:(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 Authorityvs. Krishna Gopal Lahoti and others](5) (1996) 9 SCC 640 [Basavva (smt) and others vs.Special Land Acquisition Officer and others]at least 1/3rd should be deducted towards development charges.Accordingly if taken, i.e 20% towards off setting the pricecontemplated in the exemplar document-Ex.C2 and 33 1/3 % towardsdevelopment charges, the total deduction to be made comes to53 1/3 %.20. I am of the view that in the interest of justice 50% couldbe deducted from the value contemplated in the exemplar document andaccordingly, the following formula emerges.The value per acre as per the exemplar document: Rs.7,46,044/- https://hcservices.ecourts.gov.in/hcservices/ The consequential value of the acquired land : Rs.7,46,143/-Less 50% deduction: Rs.3,73,072/------------------- Rs.3,73,072/------------------21. Accordingly, I direct the appellant to calculate thecompensation and deduct therefrom the compensation already depositedwith solatium and interest, and calculate solatium at 15% on theenhanced compensation as well as interest at 6% p.a. from the dateof taking delivery till the date of deposit.22. Substantial Question of law(v): The perusal of the order ofthe lower Court is bereft of merits relating to collection of Courtfee. It appears, the High Court issued checkslip to the PrincipalSubordinate Judge, Gobichettipalayam for the purpose of collectingadvalorem Court fee as contemplated under Section 51 of the TamilNadu Court Fees and Suits Valuation Act. However, without doing so,the lower Court simply remarked as though if any appeal or revisionis filed, at that time, the Court fee could be collected dependingupon the decision that could be arrived at. Such an approach by theappellate authority was without any rhyme or reason and it isdeprecated in unmistakable terms. 23. At this juncture, I would like to refer to the decision ofthe Division Bench of this Court reported in 2010 (2) CTC 1 – THESPECIAL TAHSILDAR, ADI DRAVIDAR WELFARE SCHEME, THIRUVALLUR, VS.M.GOPINATHAN, certain excerpts from it would run thus:"18. In Ramaih and others v. Special Tahsildar, Adi-dravidar Wlfare, Cheranmahadevi, Ambasamudram Taluk,Tirunelveli District and others, 2008(1) CTC 316, learnedSingle Judge has taken the view that appeals filed by landowner under Section 9 of the Act 31/1978, Section 51 ofCourt-Fees Act should not be made applicable. The learnedSingle Judge has taken the view that Amount determinedunder Section 7 of the Act does not become an award and itbecomes an award only when authority tenders amount underSection 11 and therefore Section 51 of Court Fees Act notapplicable and only Article 3, Schedule II of Court FeesAct applies.19. In Gunasekar and others v. Special Tahsildar, AdiDravidar Welfare, Tirunelveli, 2008(2) CTC 595, referringto Ananthi Ammal's case, learned Single Judge has taken theview that in an appeal filed under Section 9 of the ActCourt Fee is payable in terms of Section 51 of the TamilNadu Court Fees Act. The learned Single Judge has held asunder: https://hcservices.ecourts.gov.in/hcservices/ "25. In paragraph 14, the Supreme Court makes a cleardistinction between a reference under Section 18 of theLand Acquisition Act 1894 and the award/order under Section7 against which an appeal is prescribed under Section 9 ofthe Act 31 of 1978. It further held that evidence producedby the person interested before the authority becomes partof the record of the Court in appeal under Section 9 of theAct 31 of 1978, whereas under the Land Acquisition Act, thecompensation has to be established in the Reference Court.The Supreme Court clearly holds that the amount determinedunder the Act 31 of 1978 is compensation and thedetermination under Section 7(2) is an award after full-fledged enquiry. The Rules provide for the procedure forsuch determination. Rule 4 provides the method fordetermination of market value of the land. Rule 5 providesthe procedure for determination of the amount. The landowner has got a right to let in evidence and establish hisclaim and if aggrieved by the determination, appeal againstthe award granting compensation for the land acquired. Aclear distinction has been drawn between the provisions ofthe Central Act, Land Acquisition Act and Act 31 of 1978,the State Act. The Supreme Court clearly comes to theconclusion that what is filed under Section 9 is an Appealagainst the award. Therefore, the amount determined andpayable by the competent authority is a compensation andthe order passed is an award/order subject to appeal at theinstance of the aggrieved land owner. In view of the abovestated legal position as held by the Apex Court, there canbe no hesitation to come to the conclusion that anaggrieved land owner or person interested while filing anAppeal under Section 9 of the Act 31 of 1978, seekingenhancement of the compensation amount being the differencebetween the amount determined and the amount claimed inAppeal, is therefore liable to pay Court Fee under Section51 of the Court Fee Act."Learned Single Judge has made a clear distinction betweenthe award passed under the Central Act and determinationthe amount under Section 7 of Act 31/1978. Once there isdetermination of the amount by an order or award underSection 7(2) of Act 31 of 1978, while filing Appealclaiming enhanced amount, Section 51 of the Tamil NaduCourt Fees and Suits Valuation Act gets attracted. Weuphold the view taken by learned Single Judge in Gunasekarand other v. Special Tahsildar, Adi Dravidar Welfare,Tirunelveli, 2008(2) CTC 595. We hold that for appealspreferred under Section 9 of the Act 31/1978, Court Fee ispayable in terms of Section 51 of Tamil Nadu Court FeesAct." https://hcservices.ecourts.gov.in/hcservices/

24. A mere poring over and perusal of the above judgment wouldmake it clear that at the time of entertaining appeal under the TamilNadu Land Acquisition Act the advolarem Court fee on enhanced claimshould be collected, but that was not done so. In fact, the landacquisition officer awarded a sum of Rs.69,247/- per acre, however,the appeal was filed seeking enhancement and that was quantified in asum of Rs.9,86,885/-. The checkslip issued by this Court would runthus:Total enhanced compensation sought forRs.9,86,885.00Compensation awardedRs. 69,247.00 ----------------DifferenceRs.9,17,638.00Advalorem Court fee payablethereon under Section 51 of the Court Fees ActRs. 68,823.50Court fee paidRs. 2.50----------------Deficit Court fee Rs. 68,821.00----------------25. As such, a sum of Rs.68,821.00 ought to have been collectedfrom the land owner, which was not collected by the lower Court. 26. Hence, for the purpose of streamlining the procedure I wouldlike to mandate that the land acquisition officer shall calculate thedifference in amount yet payable to the land owner as per thisjudgment and out of that, the sum of Rs.68,821.00 shall be deductedand deposited in the Court fee account in the treasury and reportthe same to this Court and the remaining amount shall be deposited inthe Sub Court, within a period of three months from the date ofreceipt of a copy of this order, so as to enable the land owner towithdraw the same. The High Court Registry shall monitor the same and report beforethis Court.Sd/Asst.Registrar/true copy/Sub Asst.Registrar https://hcservices.ecourts.gov.in/hcservices/ MskTo1. The Principal Sub Court, Gobichettipalayam.2. The Special Tahsildar (Adi Dravidar Welfare) Sathiyamangalam3. The Registrar General, High Court, Madras1 cc To The Special Government Pleader, SR.183071 cc To Mr.N.Manokaran, Advocate, SR.18281S.A.No.601 of 2006NG(CO)SRA (12/05/2011)