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PETITIONER: PADMA UPPAL ETC.

       Vs.

RESPONDENT: STATE OF PUNJAB & ORS.

DATE OF JUDGMENT23/08/1976

BENCH: SINGH, JASWANT BENCH: SINGH, JASWANT RAY, A.N. (CJ) BEG, M. HAMEEDULLAH

CITATION:  1977 AIR  580            1977 SCR  (1) 329  1977 SCC  (1) 330  CITATOR INFO :  R          1977 SC1560  (6)  F          1984 SC 892  (13)  R          1988 SC 580  (6)  RF         1992 SC 666  (3)

ACT:             Land acquisition--Fixing compensation--When the  Supreme         Court could interfere.             Procedure--When  a Court of appeal can interfere in  the         lower court’s judgment.

HEADNOTE:             In  respect  of a vast area of land,  partly  urban  and         partly  rural,  adjoining each other, acquired by the  State         Government  the Collector classified a part of it as  poten-         tial building area and part as agricultural land and fixed a         slightly  higher rate of compensation for the former  and  a         lower rate for the latter. Accepting the classification, the         Senior  Sub-Judge to whom the determination of  compensation         was  referred enhanced the compensation in respect  of  both         classes of land.  In appeal, the High Court further enhanced         the compensation of both classes of land.  In further appeal         to  this Court, it was contended  that  since the  whole  of         the  land  in question formed one consolidation  block,  the         entire  area should have been treated as potential  building         area  and  compensation  fixed on the basis  of  the  market         value.         Dismissing the appeals,             HELD: In an appeal from an award granting  compensation,         this  Court  should not interfere unless there  is  a  wrong         application of any well-settled principle or unless there is         something to show not merely that on the balance of evidence         it is possible to reach a different conclusion but that  the         judgment  cannot be supported by reason of a wrong  applica-         tion of a. principle or because some important point affect-         ing valuation has been overlooked or misapplied. There is  a         prudent  condition to which the appellate  power,  generally         speaking  is subject,  namely that a court of appeal  inter-         feares  not when the judgment under attack is not right  but         only when it is shown to be wrong. [333 F]             The   Special  Land  Acquisition   Officer,    Bangalore

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       v.T..Adinarayan  Setty  [1959] Supp. 1  S.C.R.  404.  Datta-         trayaya  Shankarbhat  Ambalgi  & Ors. v.  The  Collector  of         Sholapur  & Anr. [1971] 3 S.C.C. 43 and The Dollar  Company,         Madras  v. Collector of Madras [1975] 2 S.C.C. 730  referred         to.             In  case of acquisition of several plots of  land  which         constitute  one  block comprising of agricultural  land  and         potential  building  area, the principle of belting  has  no         application.  As such the erstwhile proprietors of the plots         cannot be granted compensation for the agricultural land  at         the same rate at which compensation is determined in respect         of  potential  building  area which is  better  situate  and         possesses far greater advantages.  [332 G]             Mirza  Nausherwan  Khan & Anr. v.  The  Collector  (Land         Acquisition) Hyderabad [1975] 1 S.C.C. 238 applied.

JUDGMENT:         CIVIL APPEALS Nos. 2694-2695, 2697-2700 and 2703-2704,/72.             Appeals from the Judgment and Order dated 3-1-68 of  the         Punjab  and Haryana High Court in Regular First Appeal  Nos.         190-193, 195198/62, 233 and 234/64 and         CIVIL APPEALS NOS. 2694-2695, 2697-2700 and 2703-2704/72.             Appeals from the Judgment and Order dated 3-1-68 of  the         Punjab & Haryana High Court in R.F.A.  Nos.  192-193,   195-         198 ’and 233-234/62.         330             S.T.  Desai (In C. As. 2394-2397 of 1972), F.S.  Nariman         (In  C As. 2398 to 2402/72, Naunitlal and Miss Lalita  Kohli         for the Appellants in C.As. 2394-2403/72 and for Respondents         in C.As. 2694-2695, 2697-2700. and 2703-2704/72.             O.P. Sharma for the Appellant in C.As. 2694-2695,  2697-         2700  and  2703-2704/72  and for the  Respondents  in  C.As.         2394-2403/72.         The Judgment of the Court was delivered by             JASWANT SINGH, J.--This batch of 18 appeals Nos. 2394 to         2403 of 1972 and 2694, 2695, 2697 to 2700, 2703 and 2704  of         1972 by certificates granted under Article 133(1)(a) of  the         Constitution  which  arise out  of  acquisition  proceedings         under  the  Land Acquisition Act, 1894 (Act No. 1  of  1894)         (hereinafter  referred  to as ’the Act’)  and  are  directed         against  the  common judgment dated January 3, 1969  of  the         High  Court  of Punjab and Haryana shall be disposed  of  by         this  judgment.  While the first group of ten  appeals  Nos.         2394  to  2403 of 1972 are by the erstwhile  proprietors  of         land  claiming  enhancement of the compensation  awarded  to         them by the High Court, the rest of the eight appeals are by         the State of Punjab challenging the quantum of  compensation         as enhanced by the High Court.              It  appears  that  a vast area of  land  measuring  832         kanals and 2 marlas (i.e. 416050 sq. yds) situate in  Amrit-         sar (Urban) and village  Tungbala, Amritsar was acquired  by         the  Government  of Punjab for  a public  purpose  viz.  the         expansion  of  the existing  Medical   College   and  allied         institutions in the city of Amritsar. Whereas the  notifica-         tion  under section 4 of the Act in respect of the aforesaid         area  was issued  on March 18, 1959, the notification  under         section  6  of  the Act wag  issued on July  4,  1959.   The         Collector,  Amritsar,  classified  the  aforesaid  area  for         fixation  of  compensation into  two categories   viz.   the         potential  building  area and the  agricultural  land.   The         Collector  categorised 60 kanals and 18 marlas  (i.e.  30450         sq.  yds). which abutted  on the circular Road  and  Majitha         Road  as  potential  building area and   the  remaining  771

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       kanals  and 4 marlas as agricultural land and by his   order         dated  December 2, 1959 awarded Re. 1/- per sq. yd. as  com-         pensation for the potential building area and Re. -/’6/- per         sq.  yd.  for   agricultural land.   Dissatisfied  with  the         award,  the erstwhile proprietors approached  the  Collector         requesting  him  to make, references  to   the  Senior  Sub-         Judge,  Amritsar under section 18 of the Act.   The   Senior         Sub-Judge made a spot inspection for the purpose of apprais-         al   of the evidence adduced before him and by his  judgment         and  award  dated June 9, 1962 accepted  the  classification         made by the Collector  but enhanced the compensation of  the         agricultural land to Re. 1/- per  sq. yd. and of the  poten-         tial building area to Rs. 1.50 per sq. yd.  On  appeal,  the         High Court after taking into consideration some transactions         of  sales in the locality proximate in point of time to  the         date  of the publication of the notification  under  section         4(1)  of the Act, the  opinion of the valuers regarding  the         trend  of the prices of land in the locality and the  situa-         tion  and  potentialities  of the land in  question  by  its         aforesaid judgment and decree dated January 3, 1968  awarded         Rs.  3/- per sq. yd. for the agricultural land and Rs.  4.50         per sq. yd. for         331         the  potential building area.  It is against  this  judgment         and  decree that the present appeals, as already stated have         been preferred.             At the hearing of these appeals, counsel for the  appel-         lants  in  the first set of ten appeals have, in  the  first         instance, urged that as the plots of land in question formed         one consolidated block, the entire area thereof should  have         been  treated  as potential building area  and  compensation         awarded  accordingly.  It has been next  contended by  coun-         sel for the appellants particularly in appeals Nos. 2402 and         2403  of 1972 that the High Court has erred  in  overlooking         the evidential value furnished by (i) the award made by  the         Collector, Amritsar fixing Rs. 4/12/- per sq. yd. as compen-         sation  for  the  land measuring  28.75  acres  in  Amritsar         (Urban) and 32.04 acres in village Tungbala, Urban which was         sought  to be acquired in February, 1947,  and  notification         under  section  4(  1 ) of the Act in  respect  whereof  was         published  on February 22, 1947, (ii) the price paid by  the         appellants  in purchasing some of the plots in  question  in         October,  1946 and January, 1947 and (iii) the  transactions         of  sale of the land in the locality made in 1958-59-  which         conclusively  established that the market value of the  land         in  question was much higher than that awarded by  the  High         Court.  On the other hand, it has been contended by  counsel         for  the  State of Punjab and Collector, Amritsar  that  the         material  on record did not warrant the enhancement  by  the         High  Court  of the compensation awarded to  the   erstwhile         properties  by the Senior Subordinate Judge, Amritsar;  that         the  High Court could not justifiably ignore the  fact  that         for  25  kanals  and 10 marlas of land which  lay  in  close         proximity to the plots of land in question and .was acquired         by the State in May, 1956, the market’ value was assessed at         Rs.  25/- per maria i.e., Re. 1/- per sq. yd.; and  that  in         any  event, the High Court acted illegally in awarding  com-         pensation  in excess of Rs. 4/- per sq. yd. claimed  by  the         respondents in the second set of six appeals Nos. 2694, 2695         and 2697 to 2700 of 1972.             Before  dealing with the rival contentions  advanced  by         counsel for the parties, it will be appropriate to refer  to         the law bearing on the matter.  The measure of  compensation         to  be awarded to the owners of immovable property  acquired         by the State is enshrined in section 23(1) of the Act  which

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       is  designed  to award just and fair  compensation  for  the         acquisition.  According to this provision, compensation  13.         as to be awarded on the basis of the market value  prevalent         on  the  date of the publication of the  notification  under         section 4(1) of the Act.  The connotation of the  expression         ’market  value’  has been explained time and again  by  this         Court.   In Khaja Mizuddin v. State of Andhra Pradesh(1), it         was laid down as follows :--                        "Under  section 23(1) of the Act, in   deter-                  mining the amount of compensation. the court  shall                  take  into  consideration the market value  of  the                  land at the date of publication of the notification                  under  section  4(1 ) thereof. Decided  cases  have                  laid down that the said market rate must be  deter-                  mined                  1) C.A. 176 of 1962 decided on April 10, 1963.                  332                  by  reference to the price which a  willing  vendor                  might  reasonably expect to obtain from  a  willing                  purchaser.   For ascertaining the market  rate  the                  court  can rely upon such transactions which  would                  afford a guide to fix the price.  Price paid for  a                  land  acquired  within a reasonable time  from  the                  date  of acquisition of the land in question  would                  certainly  be  the best piece of  evidence.   Price                  paid  for a land possessing advantages  similar  to                  those of the land acquired in or about the time  of                  notification will also supply the data for  assess-                  ment of compensation."                      Bearing  in mind the above principles,  let  us                  now deal with the contentions raised by counsel for                  the erstwhile owners of the plots of land in  ques-                  tion.  The contention of counsel for the appellants                  that compensation should have been awarded treating                  the  entire  land  as potential  building  area  is                  devoid  of substance.  It is true that the land  in                  question  constitutes  one block but it  cannot  be                  overlooked  that  the entire area  thereof  is  not                  similarly situate and does not possess the same  or                  similar advantages and benefits.  The Senior Subor-                  dinate Judge (who had the advantage of spot inspec-                  tion.)  as also the High Court have  after  careful                  analysis  of the evidence observed that it is  only                  the  portion of the area which adjoins the  Majitha                  Road opposite to which is situate the Sacred  Heart                  Convent  which lies close to Gopalnagar and a  por-                  tion  of the land on the Circular Road opposite  to                  which  there are buildings that can  reasonably  be                  regarded  as  a  potential building  area  and  the                  remaining area which extends far beyond the  align-                  ment  of  the  Sacred Heart Convent  and  does  not                  possess  the same advantages cannot be  treated  at                  par  with the former category of the land.  It  has                  also  been concurrently found by the  Courts  below                  that apart from the fact that the land which  falls                  within  the second category is situate in the  rear                  away  from  habitation, it suffers from  two  other                  drawbacks in that it is not accessible from  either                  side   of  the  two roads and there  are  no  roads                  therein.  The erstwhile  proprietors cannot, there-                  fore,  be justifiably granted compensation for  the                  agricultural land at the rate determined in respect                  of the potential building area which possesses  far                  greater advantages.  We are fortified in this  view                  by  a  decision of this Court in  Mirza  Nausherwan

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                Khan  &  Anr. v. The Collector  (Land  Acquisition)                  Hyderabad(1)  where Krishna lyer, J who  spoke  for                  the Bench said :--                        "It  is  true that the Court  has  adopted  a                  higher value for a strip 50 feet wide adjoining the                  road, based on the principle of belting.  There  is                  no doubt that when we deal with value of an  exten-                  sive plot of land in a city the strip that  adjoins                  an  important  road will have a higher  value  than                  what is in the rear, for obvious reasons of  poten-                  tial user or commercial exploitation."             We  cannot also accede to the contention of counsel  for         the  appellants in appeals Nos. 2402 and 2403 of  1972  that         they should have at least been granted compensation for  the         potential buildings area at Rs. 4/12/- the rate fixed by the         Collector, Amritsar for 28.75 acres in Amritsar (Urban)  and         32.04 acres in village Tungbala,  Amritsar         (1) [19751 1 S.C.C. 238.         333         sought to be acquired by the State in February, 1947 as  the         proceedings  for acquisition of the said area  were  dropped         and the proximity in point of time to the notification under         section  4  (1 ) of the Act which is a  material  factor  is         lacking.             The  contention advanced on behalf of the appellants  in         the  aforesaid two appeals that the compensation awarded  to         them  could  not be fixed below the price paid by  them  for         some  of  the plots in question in 1943, 1946 and  1947  has         also  no force.  It cannot be ignored that .Amritsar  having         come  near  the border as a result of the partition  of  the         sub-continent,  the  prices  of land  situate  therein  fell         considerably soon after the partition and kept on  maintain-         ing a low level for more than a decade.             The  contention  of counsel for the appellants  .in  the         aforesaid  two appeals that they should have at  least  been         awarded compensation for the potential building area at  the         rate prevalent in Gopalnagar in 195859 cannot also be acced-         ed  to.   A glance at the chart of the  acquisitions   which         appears  at page 85 of the Paper Book shows that  the  sales         were of very small plots of land. In seven transactions  out         of  eight to which our attention has been invited, the  land         acquired  was below 200 sq. yds. and in the eighth  transac-         tion,  it was 250 sq. yds.  It is also well settled that  in         determining  compensation the value fetched for small  plots         of land cannot be applied to the lands covering a very large         extent and that the large area of land cannot possibly fetch         a  price at the same rate at  which small plots   are  sold.         (See   Collector  of Lakhimpur v. Bhuban  Chandra  Dutta(1).         All  the three contentions advanced on behalf of the  claim-         ants of compensation, therefore, fail.         Let  us now deal with the second set of the aforesaid  eight         appeals  preferred by the State of Punjab.  While doing  so,         it would be well to recall that it is well established  that         in an appeal from an award granting compensation, this Court         should not interfere unless there is a wrong application  of         any well settled principle or unless  there  is something to         show not merely that on the balance of evidence it is possi-         ble  to reach a different conclusion but that  the  judgment         cannot  be supported by reason of a wrong application  of  a         principle  or because some important point affecting  valua-         tion has been overlooked or misapplied.  Moreover, there  is         a prudent condition to which the appellate power,  generally         speaking, is subject.  A court of appeal interferes not when         the  judgment under attack is not right but only when it  is         shown to be wrong.  (See The Special Land Acquisition  Offi-

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       cer,  Bangalore  v. T.   Adinarayan  Setty(2)   Dattatrayaya         Shankarbhat  Ambalgi & Ors. v. The Collector of  Sholapur  &         Anr.(3)  and  The  Dollar Company, Madras  v.  Collector  of         Madras(4).             The  first  contention advanced on behalf of  the  State         that the erstwhile owners of the land in question could  not         be  given  compensation higher than that  assessed  for  the         acquisition  made by the State for the construction  of  Hy-         giene and Vaccine Institute is devoid of force.          (1) A.I.R. 1971 S.C. 2015        (2) [1959] Supp. 1  S.C.R.         404.          (3) [1971] 3 S.C.C. 43.          (4) [1975] 2 S.C.C. 730.         334         Whereas the notification under section 4(1) of the Act  with         regard  to that acquisition was published on May  17,  1956,         the  notification  under the said provision or  the  Act  in         respect  of the instant acquisition was published  on  March         18,  1959 when the market value of the land in the  locality         had risen very high.  The ratio of compensation assessed for         the  former acquisition cannot, therefore, serve as  a  safe         guide for determination of compensation for the  acquisition         in   question.  Similarly, the consideration  paid  by  Smt.         Balwant  Kaur to  Shri Girdbari Lal in March, 1957  for  the         purchase  of land cannot also serve as a safe guide as  this         transaction  also  took  place in  March, 1957 i.e.,  nearly         two years before the publication of the aforesaid  notifica-         tion in respect of the present acquisition.  The High  Court         was, in our opinion, perfectly justified on the basis of the         material  before it in fixing compensation at Rs.  4.50  per         sq. yd. for the potential building area and Rs. 3.00 for the         agricultural  area in respect of the plots of land  involved         in  appeals  Nos. 2402 and 2403 of 1972.   The  High  Court,         however, was wrong in overlooking an important point affect-         ing  compensation  payable to the erstwhile  owners  of  the         potential building area involved in appeals Nos. 2694,  2695         and 2697 to 2700 of 1972.  The said claimants having claimed         compensation only at the rate of Rs. 4.00 per sq. yd. in the         first  appeals filed by them in the High Court,  they  could         not  have  been awarded  compensation exceeding  that  rate.         Thus  the  said  appeals filed by the State  cannot  but  be         allowed  to the extent to which the compensation awarded  to         the  claimants  in respect of the  potential  building  area         acquired exceeds Rs. 4.00 per sq. yd.             In  the  result, appeals Nos. 2394 to 2403 of  1972  and         2703  and  2704 of 1972 fail and are hereby  dismissed  with         costs  (limited to one hearing fee) and appeals  Nos.  2694,         2695 and 2697 to 2700 of 1972 are allowed with costs (limit-         ed to one  hearing fee) to the  extent indicated above.         P.B.R.                                      Appeals   partly         allowed.         335