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PETITIONER: INDER SINGH AND ORS.  ETC.  ETC.

       Vs.

RESPONDENT: UNION OF INDIA ETC.  ETC.

DATE OF JUDGMENT27/04/1993

BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. SAHAI, R.M. (J)

CITATION:  1993 SCR  (3) 371        1993 SCC  (3) 240  JT 1993 (3)   653        1993 SCALE  (2)667

ACT: % Land Acquisition Act, 1894: Sections 4, 18, 32-Acquisition of  land-Compensation-Payment of-Potentional value for future development-Comparable  sale transaction-Consideration  of-Determination and  payment  of compensation-Ordered.

HEADNOTE: The  Respondents  acquired some lands for setting  up  Brick Kilns.  The lands consisted of Abi (cultivated land), Barani (rainfed  land)  and  ghair  munkin  (waste  land)  and  the Collector fixed the compensation @ at Rs. 23,600, Rs. 17,000 and Rs. 12,000 per acre of the respective lands. On a reference the Civil Court enhanced the compensation  to Rs.33,600  per  acre  for Abi  lands.   No  enhancement  was allowed  in  respect of the other categories  of  land.   It however allowed solatium at 15 % and interest at 6 % p.a. on the enhanced compensation.  On appeal, a Single Judge of the High  Court  confirmed the same.  These appeals  were  filed against the said Judgment of the High Court. The  appellants  contended that the acquired lands  had  the potential value for residential and commercial purposes  and there  was no justification for classification of the  lands and all the lands shall be treated at party in determination of  market value; that in a similar case, the  market  value was enhanced to Rs. 75,000 per acre and in view of the  fact that  certain  mutation  entries showed a  market  value  of similar lands ranging from Rs. 1,16,000 to Rs. 1,60,000, per acre the appellants claimed for compensation of at least  at Rs. 75,000 per acre. On  behalf  of  the Respondents it was  contended  that  the mutation record was not admissible as no one connected  with the  sale transactions was examined to prove the  documents, the  ground  for  sales, comparative  advantages  and  their respective situation; that the lands possessed comparable or better amenities and whether the lands are very near to  the lands under 372 acquisition.   The compensation awarded by the Collector  at the rate of Rs. 15,525 per acre was upheld by the  Reference Court, and this offered’ a reasonable base to fix the market

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value of the lands under acquisition. Partly allowing the appeals, this Court, HELD:     1. Neither the appellants nor the Land Acquisition Officer  had  examined  witnesses  in  proof  of  the   sale transactions  referred  in  the  mutation  entries.   It  is settled  law  that  a  claimant  is  entitled  to  just  and reasonable compensation under s. 23, To determine the market value of the lands, it is necessary to examine witnesses  to prove the prevailing prices as on the date of publication of the notification under s. 4(1).  The sale transaction of the same  Lands or sales of lands situated in the  neighbourhood possessed  of  same or similar advantages would  furnish  as evidence of comparable sales.  It would be possible to  have reliable  evidence  when  sale transactions  are  proved  by either  the vendor or the vendee and if either of  them  was not  available,  the  attesting  witness  who  had  personal knowledge of the transactions is to be examined by producing either the original sale deed or certified copies thereof as evidence.   Since  at  the relevant time it  was  not  being insisted  upon, none of the witnesses were called  to  prove the sale deeds or to prove the sale transactions.  Thus, the documentary  evidence of sale transactions or  the  mutation entries  on  either  side are  clearly  not  admissible  and therefore,  they cannot be looked into, and are  accordingly excluded from consideration. (375-GH, 376 (H-E) 2.   The situation of the lands dearly shows that the  lands are situated very dose to     developed  Chandigarh  planned city and are very near to Sukha Lake and the railway  track. They  are  situated  within  the  freezed  zone  for  future potential  development of the city.  Though the  acquisition was for establishment of Brick Kilns, by its very nature the lands  may  not  immediately be capable of  being  used  for residential or commercial purposes, but certainly  possessed of potential value for future development as residential and commercial  purposes.   There is a distinction  between  the lands acquired for Motor Market or Mansa Housing Complex  on the one hand and the lands under   acquisition on the  other hand, though the lands are Abi lands going by the  situation of  the  lands, the market value of the  land  acquired  for motor  market do not render any assistance as  a  comparable price.   This  would be of assistance to assess a  fair  and reasonable compensation in fixing the market value though an amount  of guess work is involved.  This Court is  conscious of    the  fact that it should not be founded  on  feats  of imagination hedged with 373 undue  emphasis of compulsory deprivation of the  possession of the lands of the appellant.  For the exercise of  State’s power  of eminent domain statutory solatium is  the  premium the State pays.  Therefore, the approach should he pragmatic to recompense the appellants to secure alternative lands  or to invest in profitable business for rehabilitation.  It  is seen  that the Reference Court awarded a sum of  Rs.  33,600 per  acre to Abi land.  No doubt there is a steady  rise  in prices of lands.  Considering the totality of the facts  and circumstances, the market value @ Rs. 42,000 per acre  would be  just and fair for Abi lands and at Rs. 38,000  per  acre for Barani lands.  The market value of ghair munkin land  at Rs. 12,000 per acre awarded by the Civil Court is confirmed. The appellants are entitled to solatium and interest on  the inhanced  market  value  at  15 per  cent  and  6  per  cent respectively  from  the date of taking possession  till  the date  of  payment as the award and the order  of  the  Civil Court  are prior to the periods mentioned in  the  Amendment Act 1984 came into force,. (376G,H, 371 A-F))

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JUDGMENT: CIVIL   APPELLATE  JURISDICTION:  Civil  Appeal  Nos.   335- 342/1982. From  the Judgment and Order dated 18.8.1981 of  the  Punjab and  Haryana High Court in Regular First Appeal  Nos.  2605, 2604,2606,2610,306,308, 10 and 11 of 1980. D.V. Sehgal, L.R. Singh and Yunus Malik for the Appellants. Ranjit Kumar and G.K. Bansal (NP) for the Respondents. The Judgment of the Court was delivered by K.   RAMASWAMY.   J.:  By  Notification  published  in   the Haryana State Gazette on October 12,1976, under  section4(1) of  Land Acquisition Act 1 of 1894 for short ’the Act’,  the respondent  Union Territory of Chandigarh acquired  a  total extent  of  70.09 acres of land situated in  Manimajra  near Chandigarh  for  a public purpose, namely, to set  up  Brick Kilns  therein.   The lands comprised  in  different  Khasra numbers  within H.B. No. 375, out of which 63.09  acres  are Abi  cultivated  lands, the rest are Barani  (rainfed  land) and,  ghair munkin (waste land) bouldars, trenches etc.   By award  dated January II, 1977, the Collector fixed a sum  of Rs.  23,600 as market value of Abi, Rs. 17,000 per  acre  to Barani  and Rs. 12,000 to Ghair Munkin lands.  On  reference under-  s. 18, the Civil Court enhanced the compensation  to Rs. 33,600 per acre to Abi lands and no enhancement to other categories  with solatium at 15 per cent and interest  at  6 percent per annum on the 374 enhanced  compensation  from the date of  taking  possession till date of payment.  On appeal the learned Single Judge in R.F.A.  No. 2605 of 1980 etc, by judgment dated  August  18, 1981  confirmed  the same.  Thus these  appeals  by  special leave.  As common questions of law arise for decision,  they are disposed of by common judgment. Appellants’ contentions is that the acquired lands possessed of  potential value for residential and commercial  purposes and  there  is no justification for  classification  of  the lands and all the lands are entitled to parity to  determine the  market value.  By notification dated June 30,  1976  in the  same village under the same H.B. No. 375,  54.37  acres were acquired for construction of Motor Market Complex.  The Collector and the Civil Court awarded the same market values as were fixed in these appeals but the learned Single  judge denied parity of market value to these lands while enhancing the market value at Rs. 75,000 per acre to the similar lands in  belting  No. 2 and awarded @Rs. 3, 72,200 to  the  lands abutting  the  main road upto a depth of 140 feet  in  other case.  Therein the Single Judge relied upon Ex.  P28 of  the year  1972 in which 17 marlas of land was sold  @Rs.  75,000 per  acre, Having relied upon the same and  having  enhanced the  market  value,  the same  yardstick  should  have  been applied  in  awarding  market  value  to  the  lands   under acquisition.    The  learned  counsel  also  placed   strong reliance  on  6 mutation entries which would show  that  the market  value  of the lands ranges between Rs.  1,16,000  to 1,60,000  per  acre  and  -the  appellants,  therefore,  are entitled to compensation at least @ Rs. 75,000 as claimed by them.   He also contended that having found that  the  lands are possessed of potential value being similar to the  lands in  other appeal, the appellants are entitled to  parity  in determination  of  the market value as  well.   The  Haryana Govt,  acquired  by notification dated January  8,1971  vast extent  of  lands in Judian Village for  Mansa  Housing  and

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Commercial  Complex and thereunder Abi/irrigated lands  were awarded at a sum of Rs. 28,800 per acre which was  confirmed by  the High Court.  After five years the  notification  was issued on October 12, 1976, the Court should have taken note of  steady  rise in prices and have  suitably  enhanced  the market   value.   Since  no  one  was  appearing   for   the respondent,  we  sent  for Mr. Ranjit  Kumar,  the  previous standing  counsel  for the Union Territory,  Chandigarh  and requested  him  to  assist the court.   Accordingly  he  has meticulously  analysed  the  entire  evidence  and  rendered valuable  assistance.   He  contended  that  the  lands  are situated  beyond railway line on North-West and 1/2 k.m.  to the  motor market on the other side of the road.  The  lands are  nearer  to  Sukhna Choe (lake) at  a  distance  of  one furlong.   The  mutation record is not admissible  as  none, connected with the sale transactions, were examined to prove the documents; the grounds for sales, comparative advantages and  their  respective  situation.   The  motor  market   is situated  in  a  developed area on the Eastern side  of  the road and the lands in these cases are 375 located  away from those lands.  Shri Ranjit also  contended that   lands  in  Judian  Village  for  Mansa  Housing   and Commercial  Complex were nearer to abadi  possessing  better amenities and they do not afford any comparable grounds.  He contended that the lands for canalisation of Sukhna Choe was acquired  by  notification  dated March  21,  1972  and  the Reference  Court  upheld the award of the Collector  at  Rs. 15,525 for Abi lands which was confirmed by the High  Court. The location being very near to the lands under requisition, they   offer   reasonable   base  to   fix   market   value. Notification was issued under s.6 of the Punjab New  Capital (Perefery)  Control Act, 1952, freezing development  of  the lands situated within a radious of 10 miles from  Chandigarh boundary  for  any  residential  and  commercial   purposes. Therefore,  they are not possessed of any  potential  value. The  learned  Judge on the same day decided both  the  cases upholding the award of the Civil Court in these cases  while enhancing  the market value in motor market cases relied  on by  the  appellants.   He  was aware  of  the  location  and differential  value between two types of land.   Therefore, he was not inclined to enhance the market value of the  land under acquisition. The first question that arises for consideration is  whether the  High Court has committed any legal error  in  affirming the  market  value determined by the Reference  Court.   The Dist,  Judge,  Chandigarh in L.P.J. No.  105/70  and  batch, found  that the total extent of the land acquired  is  70.09 acres, 560 Kanal 15 mawla, out of which 63.91 (51 i Kanal) 6 Marla  are Abi land and 4.22 (33 Kanal 15 Marla)  is  Barani land and the rest are Ghair Munkin lands.  It is admitted by the  witnesses  that  the acquired land  is  nearer  to  the railway track and also situated at a distance of 1- 1/2 k.m. from  timber  and motor market.  They are situated  in  wide area  with  the population of about  3000-3500.   There  are about  200 shops situated in Manimazra town.   The  acquired land  is  towards  north-western  side  of  Manimazra.   The railway  line  is  2  to 3 furlong  from  Manimaira  on  the northwestern side.  They are also situated near the boundary of Chandigarh and one furlong from Sukhna Choe.  It was also admitted  that  part of the land is situated in  Sector  26. Thus it could be seen that the lands are situated very  near to Chandigarh. Neither the appellants nor the Land Acquisition Officer  had examined  witnesses  in  proof  of  the  sale   transactions

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referred in mutation entries Ex.  P4 to P8 on behalf of  the appellants and R1 and R2 on behalf of the respondent.  It is settled law that claimant is entitled to just and reasonable compensation  and under s. 23 to determine the market  value of  the  lands the prevailing prices as on the date  of  the publication  of  the notification under s.  4(1),  the  sale transaction of the same lands or sales of lands situated  in the  neighbourhood would furnish as evidence  of  comparable sales.  The price which a hypothetical willing vendor  might reasonably expects to obtain from a willing purchaser  would form the basis to fix the market 376 value.  It would be possible to have reliable evidence  when sale  transactions  are proved by either the vendor  or  the vendee  and  if  either  of  them  was  not  available,  the attesting   witness  who  had  personal  knowledge  of   the transaction  is  to  be examined  by  producing  either  the original sale deed or certified copies thereof as  evidence. Under  s. 5 1A of the Act as amended in 1984  the  certified copies  have  been  permitted to be  brought  on  record  as evidence   of  sale  transaction  recorded   therein.    The examination  of  the  witnesses is to  find  that  the  sale transactions  are bonafide and genuine transactions  between willing vendor and willing vendee as reasonable prudent  men and  the  price mentioned is not throw away  price  at  arms length  or  depressed  sales or brought  into  existence  to inflate market value-,of the lands under acquisition and the sales are accommodating one.  Equally it must be brought  on record the comparative nature of the lands covered under the sale deed and the acquired lands whether adjacent or  actual distance  or  possessed of similar  advantages  and  whether transactions  themselves  are genuine  and  bonafide  trans- actions.   This  proposition of law, since settled  law,  in fairness,  has  not  been  disputed  across  the  bar.   The contention  is  that at the relevant time it was  not  being insisted upon.  Therefore, none of the witnesses were called to  prove the sale deeds or to prove the sale  transactions. Therefore  , when evidence of potential value is  available, the  same  could  be  considered.   We  find  merit  in  the contention.   At one time we thought of remanding the  cases but  we find that it would be needless prologation  and  the complexion  on  ground  by now would  have  been  completely changed.   In view of the above settled legal  position  and the   circumstances,  the  documentary  evidence   of   sale transactions  or in the mutation entries on either side  are clearly not admissible and therefore, they cannot be  looked into, and are accordingly excluded from consideration. The  only  question,  therefore, is whether  the  lands  are possessed of potential value and whether the same  treatment could be meted out to Abi and Barani lands.  Ghair    Munkin land  stands  on a different footing  and,  therefore,  they cannot  be  equated  with the Abi  and  Barani  lands.   The situation  of the lands as extracted here in before  clearly shows  that the lands are situated very close  to  developed Chandigarh planned city and are very near to Sukhna Lake and are also nearer to railway track.  They are situated  within the  freezed  zone for future potential development  of  the city.  Thereby, it is clear that though the acquisition  was for  establishment  of Brick Kilns, by its very  nature  may not immediately be capable of being used for residential  or commercial  purposes, but certainly possessed  of  potential value  for future development as residential and  commercial purposes.   Then what would be the reasonable  market  value prevailing  as  on  the date of  notification.   As  rightly contended  by Shri Ranjit Kumar that there is a  distinction

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between the lands acquired for motor market or Mansa Housing Complex on one  hand and the lands under acquisition on  the other hand, though the lands are Abi 377 lands.  The acquired lands are situated on the western  side of  Manimazra  Panchkula  road  and  the  motor  market  was situated  on  the other side of the  road.   Therefore,  the market  value of the land acquired for motor market  do  not tender  any assistance as comparable prices.  Obviously  for that  reason  the same learned Single Judge  while  deciding both  the  appeals on the same day declined to  enhance  the market value to these lands while he awarded to lands in 2nd belt at Rs. 75,000 per acre.  We have no information whether any  appeal was filed against that judgment.  But  certainly the  facts of these cases would assist us to assess  a  fair and  reasonable  compensation  in fixing  the  market  value though an amount of guess work is involved. We are conscious of  the  fact  that it should not be  founded  on  feats  of imagination   hedged  with  undue  emphasis  of   compulsory deprivation of the possession of the land of the appellants, for  the  exercise  of  State’s  power  of  eminent  domain, statutory   solatium   is  the  premium  the   state   pays. Therefore,  the approach should be pragmatic  to  recompense the  appellants to secure alternative lands or to invest  in profitable business for rehabilitation.  It is seen that the Reference  Court awarded a sum of Rs.33,600 per acre to  Abi land.  There is a steady rise in prices as reflected in  the judgment  in  the  other appeals relied on  by  the  learned counsel  for  appellants.   The  High  Court  also  recorded a.finding  in that behalf in those appeals.  The  lands  are situated  in  the  same H.B. No. 375,  though  at  different places  and  distance having future  potential  development. Considering  the totality of the facts and circumstances  we find  that market value @ Rs. 42,000 per acre would be  just and fair.  This value should be for Abi and for Barani lands at Rs. 38,000 per acre and the market value to ghair  munkin land  at Rs. 12,000 per acre awarded by the Civil  Court  is confirmed.   The  appellants  are entitle  to  Solatium  and interest  on the enhanced market value at 15 per cent and  6 per  cent  respectively from the date of  taking  possession till  the date of payment as the award and the order of  the Civil  Court  are  prior to the  periods  mentioned  in  the Amendment  Act 1984 came into force.  In  the  circumstances parties are directed to bear their own costs. G.N. Appeals Partly allowed. 378