IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 10182 OF 2010 [Arising out of SLP(C) No.19058/2009]

SPECIAL LAND ACQUISITION OFFICER, MYSORE URBAN DEVELOPMENT AUTHORITY

.......APPELLANT

Versus

SAKAMMA .....RESPONDENT

WITH  

CIVIL APPEAL NO. 10184 OF 2010 [Arising out of SLP(C) No.18707/2009]

O R D E R

Leave granted.  Heard.

2. 221 acres 20 guntas of land in Keragalli village,  

Mysore Taluk, including three acres of land belonging to the  

respondent in each of these two appeals were acquired for  

the  Mysore  Urban  Development  Authority  for  formation  of  

layout  under  preliminary  notification  dated  15.7.1997  

(Gazetted  on  24.7.1997)  and  final  notification  dated  

29.3.2001, issued under Sec.17 (1) and 19(1) of Karnataka  

Urban Development Authorities Act, 1987. After making the  

award,  possession  was  taken  on  16.8.2003  and  27.11.2003  

respectively.

3. The  Land  Acquisition  Officer,  by  his  Award  dated  

4.2.2003, determined the compensation as Rs.1,55,000/- per  

acre. On reference, the reference Court, by judgment and  

award  dated  17.4.2008,  increased  the  compensation  to  

Rs.13,49,000/- per acre. It also awarded 30% solatium, 12%  

additional amount from the date of preliminary notification  

to date of award and interest at the rate of 9% per annum  

for one year from the date of preliminary notification and  

thereafter at the rate of 15% per annum.

4. Feeling  aggrieved,  the  appellants  filed  appeals  

before the High Court.  The High Court, by the impugned  

judgment  dated  21.10.2008,  confirmed  the  award  of  the  

reference Court.  The said judgment is challenged in these  

appeals by special leave.

5. Two contentions are urged by the appellants:  

(i) The award of compensation at Rs.13,49,000/- per acre  is excessive, erroneous and not based on any evidence; and

(ii) Interest  could  be  awarded  only  from  the  date  of  taking  possession  and  not  from  the  date  of  preliminary  notification.

6. The  reference  Court  and  the  High  Court  have  

increased the compensation by relying upon the judgment and  

award  dated  16.3.2006  of  the  reference  Court  (Ex.P-2)in  

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regard  to  acquisition  of  certain  lands  situated  at  

Maragowdanahalli  village  under  preliminary  notification  

dated 13.9.1990, wherein compensation was awarded at the  

rate of Rs.9,50,000/- per acre. Reference Court and the High  

Court have thought fit to give an increase of 7% per annum  

for the period between 13.9.1990 to 24.7.1997 to arrive at  

the market value of the acquired land as Rs.13,49,000/- per  

acre.

7. The evidence shows that Maragowdanahalli village is  

far  away  from  Keragalli  where  the  acquired  lands  are  

situated. They are separated by two villages namely Bhogadi  

and  Hinakall.  The  distance  between  the  two  villages  is  

stated to be 3 to 5 kilometers. The appellant contends that  

the actual distance is around 9 kilometer, but there is no  

such evidence on behalf of the appellant. The evidence also  

shows  that  Maragowdanahalli  is  situated  near  a  railway  

station  whereas  Keragalli  does  not  have  facility  of  a  

railway station.  Further that Maragowdanahalli is nearer to  

Mysore  city  and  far  more  developed  when  compared  to  

Keragalli.  (It  is  also  stated  that  Maragowdanahalli  is  

within the municipal limits of Mysore whereas Keragalli is  

outside  the  municipal  limits,  but  there  is  no  specific  

evidence in that behalf).  

8. There is no evidence to show that the acquired lands  

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at Keragalli and Maragowdanahalli are comparable lands with  

similar  market  value.  The  distance,  the  extent  of  

development and the facilities available in the two villages  

make it clear that award made by the reference Court with  

reference  to  an  acquisition  in  Maragowdanahalli  village  

cannot be the basis for determining the market value for the  

lands at Keragalli. We are of the view that the reference  

Court  and  the  High  Court  committed  a  serious  error  in  

relying  upon  the  Judgment  (Ex.P-2)  relating  to  

Maragowdanahalli, to determine the market value of lands at  

Keragalli. If Ex. P-2 is excluded, we find that there is no  

evidence to determine the market value, as the only other  

document  relied  upon  by  the  land  owners  was  a  sale  

transaction of 2007 which being nearly one decade after the  

acquisition, is not of any assistance. We also find that no  

evidence  has  been  let  in  by  the  appellant  in  regard  to  

market  value  though  the  award  of  LAO  refers  to  sale  

transactions  during  1997-1998  showing  a  value  of  

Rs.2,50,000/- per acre in Keragalli. But those sale deeds  

were not produced.

9. We are also told that the reference cases in regard  

to several other lands under the same acquisition are still  

pending  before  the  Reference  Court  and  some  cases  are  

pending in High Court. In the absence of any acceptable  

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evidence, it is not possible for us to determine the market  

value. It would appear that sale transactions relating to  

1996-1997-1998  for  lands  near  to  acquired  lands  are  

available but not produced. Some of them are now produced by  

appellant. We cannot obviously rely upon them as they are  

produced  for  the  first  time  in  this  court  and  the  land  

owners did not have an opportunity to have their say in  

regard to such transactions by letting evidence. Interests  

of justice, therefore, requires that the matter should be  

remanded.

10. Insofar as  interest  is  concerned,  it is clear  

that having regard to the provisions of Section 28 of the  

Land Acquisition Act, 1894, interest can be awarded only  

from the date of taking possession of the acquired lands and  

not from the date of preliminary notification.  

11.  We,  therefore,  allow  these  appeals,  set  aside  the  

judgment  of  the  High  Court  and  the  reference  Court  and  

remand the matter to the reference Court which shall decide  

the matter afresh after giving due opportunities to both  

parties to produce further evidence regarding market value.  

12. Learned counsel for the appellants submits that the  

Mysore  Urban  Development  Authority  has  already  formed  a  

layout and the plots are ready for allotment and any delay  

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in determining compensation will affect the determination of  

allotment price of plots. Therefore, there is some urgency  

in the matter. On the facts and circumstances, we request  

the reference Court to dispose of the matter expeditiously  

preferably within four months from 27.1.2011, on which date  

both parties shall appear before the reference court without  

further notice.

  ......................J.            ( R.V. RAVEENDRAN )

  ......................J.            ( P. SATHASIVAM )

  ......................J.                  ( A.K. PATNAIK )

New Delhi; November 30, 2010.

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