State of Haryana and Others v. Mahender Singh & Ors.

Argued by:- Mr. Gaurav Garg, AAG, Haryana for the appellant in RFA-1020-2023, and for the respondent in RFA-978-2023. Mr. Adarsh Jain, Senior Advocate with Ms. Amandeep Kaur, Advocate and Ms. Kamaldeep Kaur, Advocate for the appellant in RFA-978-2023, and for the respondent in RFA-1020-2023. DEEPAK GUPTA, J. These cross-appeals arise out of the award dated 02.02.2023 passed by the learned Addi-onal District Judge, Panipat, whereby the reference filed under Sec-on 18 of the Land Acquisi-on Act, 1894 was partly allowed and the compensa-on awarded by the Land Acquisi-on Collector was enhanced from ₹42,00,000/- per acre to ₹75,00,000/- per acre along with all statutory NEETIKA TUTEJA 2026.04.06 17:28 I attest to the accuracy and integrity of this document RFA-1020-2023 (O&M) RFA-978-2023 (O&M) benefits.

2. The land in ques-on was acquired pursuant to no-fica-on dated

20.10.2011 issued under Sec-on 4 of the Act for the public purpose of se8ng up/expansion of a Sewerage Treatment Plant at Panipat. The Land Acquisi-on Collector had assessed the market value of the acquired land at ₹42,00,000/- per acre. Dissa-sfied therewith, the landowners sought a reference claiming that the acquired land was situated within the urban limits of Panipat, pos- sessed considerable commercial, industrial and residen-al poten-al, and had been grossly undervalued.

3. The Reference Court, upon apprecia-on of the material placed on record, enhanced the compensa-on to ₹75,00,000/- per acre.

4. Aggrieved by the said determina-on, both sides are before this Court. The landowners seek further enhancement on the ground that the Refer- ence Court failed to adequately appreciate the poten-ality and advantageous loca-on of the land, whereas the State seeks reduc-on contending that the Ref- erence Court has erred in law in relying upon Collector rates as the primary ba- sis for determining market value.

5. Learned senior counsel appearing on behalf of the landowners has contended that the acquired land formed part of the rapidly developing urban area of Panipat and was surrounded by residen-al, commercial and industrial establishments. It is submi<ed that the Collector rates relied upon by the Refer- ence Court themselves do not reflect the true market value and are generally on the lower side, as sale transac-ons are o>en under-reported to avoid stamp duty. It is thus argued that the compensa-on ought to have been assessed at a much higher rate.

6. Per contra, learned counsel for the State has argued that the Ref- erence Court has commi<ed a patent error in law in determining the market value solely on the basis of Collector rates. Reliance has been placed upon the judgment of the Hon’ble Supreme Court in Bharat Sanchar Nigam Limited v. NEETIKA TUTEJA 2026.04.06 17:28 I attest to the accuracy and integrity of this document RFA-1020-2023 (O&M) RFA-978-2023 (O&M) M/s Nemichand Damodardas and anr. 2022 (14) SCC 60, to contend that ready reckoner or circle rates, being meant for the purpose of levy of stamp duty, have no statutory founda-on for determina-on of compensa-on under Sec-on 23 of the Land Acquisi-on Act, 1894 and cannot form the basis for enhancement. It is further contended that the claimants having failed to produce any reliable sale exemplar of comparable land, the burden cast upon them has not been dis- charged and the award of the Land Acquisi-on Collector deserves to be re- stored.

7. Having heard learned counsel for the par-es and having gone through the record with their assistance, this Court finds that the determina-on of market value under the Land Acquisi-on Act is governed by well se<led prin- ciples.

8. In Chimanlal Hargovinddas v. Special Land Acquisi&on Officer, Poona 1988 AIR SC 1652, the Hon’ble Supreme Court has held that a reference under Sec-on 18 is in the nature of an original proceeding and the Court is re- quired to determine the market value afresh on the basis of evidence adduced before it. It has been further held that the burden lies upon the claimant to es- tablish that the compensa-on awarded by the Collector is inadequate and that the best evidence for determining market value is that of comparable sale trans- ac-ons of similar land in the vicinity executed within a reasonable period prior to the no-fica-on under Sec-on 4.

9. The aforesaid posi-on has been reiterated in a catena of decisions including Periyar and Pareekanni Rubbers Ltd. v. State of Kerala, 1990 AIR SC 2192, wherein it has been emphasized that valua-on must be based on recog- nized methods and sound evidence. Recently, in Bharat Sanchar Nigam Limited v. M/s Nemichand Damodardas (supra), the Hon’ble Supreme Court has categor- ically held that the rates men-oned in the ready reckoner or maintained for the purpose of stamp duty cannot be the basis for determining market value of ac- quired land, as such rates are uniform in nature and do not reflect the actual price of individual parcels of land. NEETIKA TUTEJA 2026.04.06 17:28 I attest to the accuracy and integrity of this document RFA-1020-2023 (O&M) RFA-978-2023 (O&M)

10. In the present case, it is an admi<ed posi-on that no reliable sale instance of comparable land executed prior to or proximate to the date of no-fi- ca-on i.e. 20.10.2011 has been brought on record by the claimants. The only document relied upon is a transac-on of the year 2013, which is clearly post-no- -fica-on and cannot safely be relied upon, par-cularly when there is no evi- dence to show that the said transac-on was uninfluenced by the acquisi-on proceedings. In terms of the principles laid down in Chimanlal Hargovinddas v. Special Land Acquisi-on Officer (supra), such post-no-fica-on transac-ons are to be considered with cau-on and ordinarily cannot form the basis for determi- na-on of market value.

11. The Reference Court, in the absence of any reliable sale exemplar, has proceeded to determine the market value primarily on the basis of Collector rates prevailing for the year 2011–12, which were ₹75,00,000/- per acre. While the approach of the Reference Court in trea-ng Collector rates as determina-ve cannot be said to be strictly in accordance with the law laid down by the Hon’ble Supreme Court, the ques-on that arises is whether, on that ground alone, the enhancement granted by the Reference Court deserves to be set aside.

12. This Court is of the considered view that the answer must be in the nega-ve. It is true that Collector rates cannot be treated as conclusive evi- dence of market value; however, it is equally well se<led that in the absence of be<er evidence, such rates may be taken into considera-on as a guiding factor, par-cularly when supported by surrounding circumstances. The Court cannot lose sight of the fact that the acquired land is situated within the revenue estate of Panipat city and was acquired for a public u-lity project in an area, which was evidently undergoing urbaniza-on. The poten-ality of the land and its loca-on are relevant considera-ons while determining market value.

13. Further, the record reveals that the Land Acquisi-on Collector had not undertaken any independent analysis and had determined the compensa- -on primarily on the basis of recommenda-ons of a commi<ee, without even NEETIKA TUTEJA 2026.04.06 17:28 I attest to the accuracy and integrity of this document RFA-1020-2023 (O&M) RFA-978-2023 (O&M) no-cing the prevailing Collector rates. In such circumstances, the award of the Collector does not inspire confidence so as to warrant its restora-on in the ab- sence of be<er evidence.

14. At the same -me, the claim of the landowners for compensa-on at the rate of ₹10,000/- per square yard is wholly unsupported by any cogent evidence. No material has been placed on record to establish that the land had a<ained such a high commercial value as on the date of no-fica-on. The claim, therefore, appears to be exaggerated and cannot be accepted.

15. Thus, this Court is faced with a situa-on where neither side has produced sa-sfactory evidence in support of its respec-ve claim. In such a situa- -on, the Court is required to arrive at a just and reasonable determina-on on the basis of available material, keeping in view the principles laid down by the Hon’ble Supreme Court.

16. Upon an overall considera-on of the loca-on of the land, its po- ten-ality, the inadequacy of the Collector’s award, the absence of reliable sale exemplars, and the limited eviden-ary value of Collector rates, this Court is of the considered opinion that the compensa-on determined by the Reference Court at ₹75,00,000/- per acre represents a fair and reasonable es-ma-on of market value as on the date of no-fica-on. Though the reasoning adopted by the Reference Court in placing reliance on Collector rates as the sole basis may not be legally sound, the ul-mate conclusion arrived at cannot be said to be un- just or arbitrary so as to warrant interference.

17. Consequently, the appeal filed by the landowners seeking further enhancement is dismissed. The appeal filed by the State seeking reduc-on is also dismissed, though it is clarified that the Collector rates have been treated only as a guiding factor and not as the sole basis for determina-on of market value.

18. The award of the Reference Court assessing compensa-on at ₹75,00,000/- per acre is affirmed. The landowners shall be en-tled to all statu- NEETIKA TUTEJA 2026.04.06 17:28 I attest to the accuracy and integrity of this document RFA-1020-2023 (O&M) RFA-978-2023 (O&M) tory benefits under Sec-ons 23(1-A), 23(2) and 28 of the Land Acquisi-on Act,

1894. The appeals stand disposed of accordingly. A photocopy of this order be placed on the connected case file. (DEEPAK GUPTA) JUDGE

06.04.2026 Nee(cid:11)ka Tuteja Whether speaking/reasoned? Whether reportable? Yes/No Yes/No Uploaded on.: 06.04.2026 NEETIKA TUTEJA 2026.04.06 17:28 I attest to the accuracy and integrity of this document