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PETITIONER: HASANALI WALIMCHAND (DEAD) BY L.RS.

       Vs.

RESPONDENT: STATE OF MAHARASHTRA

DATE OF JUDGMENT:       06/01/1998

BENCH: A.S. ANAND, S. RAJENDRA BABU

ACT:

HEADNOTE:

JUDGMENT:                             WITH                CIVIL  APPEAL NO. 7440 OF 1983                          O R D E R      This order  will dispose  of both appeals as they arise out of  the same  judgment and  order of  the High  Court of Bombay, dated 26.9.1979.      Land measuring 14 acres and 9 Gunthas, which is subject matter of  these appeals, situate in village Kedgaon, Taluka Nagar, District  Ahmednagar, Maharashtra was acquired by the State. Notification  under Section 4 of the Land Acquisition Act  (hereinafter   the  Act)   was  issued   on   1.3.1969. Notification under section 6 of the Act was published in the gazette on  26.6.1969. The  land  was  acquired  for  public purpose for  extension of living place for the population as also  for  construction  of  government  godowns.  The  Land Acquisition Collector, vide Award dated 29.9.1970 determined the market  value of the land at Rs.3,000/- per acre and Rs. 3200/- per  acre Compensation  amounting to Rs. 49,301/- was awarded. Aggrieved  by the  Award of  the  Land  Acquisition Collector, the claimants sought a reference under Section 18 of the  Act. The  learned joint  Civil judge, vide his Award dated 28th  August, 1971,  determined the market value @ Rs. 1/- per  square foot,  inter-alia after  taking into account rates fixed  by a  Cooperative Housing  Society for  sale of plots by  it to its members and outsiders in the vicinity of the acquired  land. The  reference  court  awarded  a  total compensation of  Rs.6,16,118.60 ps.  The respondent  - State approached the High Court against the award of the reference court. On  26.9.1979, the  High Court set aside the award of the reference  court made  under Section  18 of  the Act and restored that  of the Land Acquisition Collector, dated 29th September, 1970.  Hence, these  appeals by  special leave by the claimants.      Mr. Krishan  Mahajan, learned counsel appearing for the appellants has  assailed the  judgment and order of the High Court principally  on the  ground that the High Court failed to take  into account  future potentiality and instead based itself only  on the  realized possibility and thus committed an error. Learned counsel has, in support of his contention, relied on  State of  Orissa Vs.  Brij Lal Misra & Ors. (1995

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(5) SCC  203) and  P.  Reddy  &  Ors.  Vs  Land  Acquisition Officer, Hyderabad  Urban Development Authority, Hyderabad & Ors. (1995  (2) SCC  305). Both  the  judgments  do  support support the submission of Mr. Mahajan.      Mr. Sathe,  learned counsel appearing for the State has supported the  judgment and  order of  the  High  Court  and submitted that  the land  was agricultural  land,  the  High Court rightly  took into  account that  fact and disapproved the approach  of the reference court which, according to the learned counsel,  was influenced  by the  rates fixed by the Ambika Cooperative  Housing Society  which consideration was not a  relevant consideration  since the  land of the Ambika Cooperative Housing  Society was developed land and had been sold in plots to its various members and outsiders.      We have  given  our  thoughtful  consideration  to  the submissions made at the bar.      The High Court has noticed in the impugned judgment and order that  the ‘location’ of the land indicates that it has building potential  but fell  into an error in ignoring that factor by observing:      "There is  no record  of any income      being received  by any  of the land      owners.    These     lands    must,      therefore,     be     valued     as      agricultural    land     with    no      potentiality  whatsoever   in   the      foreseeable future."      We are  unable  to  find  any  justification  for  such observation and finding. The above finding of the High Court is  contradictory  to  the  earlier  finding  based  on  the location of  the  land.  It  is  nodoubt  correct  that  the reference court  was  influenced  by  sale  Cransactions  in respect  of  developed  land  and  it  failed  to  make  any deduction  for  development  of  land  while  enhancing  the compensation, but  the High  Court fell in error in ignoring the future  potential of  the land  in question  and instead resting its finding as realized potential only. The evidence on the record clearly establishes that the acquired land did have future  potential on account of its location. It is not denied that  the area  around the city of Ahmednagar is fast developing and  the land  in question  was located only at a short distance of about one and a half miles form Ahmednagar town. The  finding recorded  by the High Court to the effect that there  was no  demand of any urban character in respect of the land in question is belied by the evidence on record. Inded the  land unlike  the Housing  Society  Land  was  not developed and,  therefore, proper  course for the High Court would have been that it should have taken not of development charges, and  made some suitable deduction for the same. The reference court  had made the Award based on the material on the record  but had  failed to notice that acquired land was still undeveloped.  It, therefore, appears appropriate to us to set  aside the  impugned judgment  and order  of the High Court and restore the award made by the reference court with the modification  that  out  of  the  amount  fixed  by  the reference court  @ Rs. 1/- per square foot, deduction to the extent of  50 paisa  per square  foot,  towards  development charges, shall  be made  and compensation calculated on that bsis and  shall paid  to the  claimants in  accordance  with their  holdings,   along  with  the  statutory  benefits  of solatium and interest.      The impugned  judgment and  order of  the High Court is set aside.  With the  aforesaid modification of the award of the reference  court, the  appeals are  disposed  of.  There shall, however, be no order as to costs.

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