SUPREME COURT OF INDIA

Before:- A.P. Misra and Ruma Pal, JJ.

Civil Appeal No. 515 of 1999. D/d. 20.9.2000.

Krishi Utpadan Mandi Samiti - Appellant

Versus

Malik Sartaj Wali Khan and Anr. - Respondents

A. Land Acquisition Act, 1894, Section 23 - Land acquisition - Market value - Agricultural land acquired - Deduction towards development charges inevitable - Rs. 5 per sq yd had fixed as compensation for land acquired - No deduction on the value fixed - Directions issued to deduct ¼th of the total amount calculated on basis of rate of Rs. 5 per sq yd towards development charges - However, total compensation payable not to go below Rs. 10 lakhs.

[Para 8]

B. Land Acquisition Act, 1894, Section 23 - Market value - Agricultural land - Value as shown in recent sale deed must be taken into account, but need not be rigidly adhered to - Claimant had earlier sold part of his land for Rs. 4.50 per sq yd - Part of land later acquired - Referring Judge fixed Rs. 5 per sq yd as compensation - Held, no reason for Supreme Court to interfere and reduce the compensation to Rs. 4.50.

[Para 6]

C. Land Acquisition Act, 1894, Section 23 - Agricultural land acquired - Computation of compensation may be carried out on square yard basis .

[Paras 3 and 4]

D. Land Acquisition Act, 1894, Section 23 - Determination of market value - Agricultural land acquired - Multiplier for fixing value of grove land - Valuation of Rs. 25,000 for grove produce was not disputed - Held, multiplier of 10 would be proper.

[Para 11]

Cases Referred :-

Koyappathodi M. Ayisha Umma v. State of Kerala.

Special Land Acquisition Officer v. Tajar Hanifabi.

Special Land Acquisition Officer v. Virupax Shankar Nadagouda.

State of M.P. v. Harishankar Goel.

ORDER

Ruma Pal, J. - The present appeal is by Krishi Utpadan Mandi Samiti challenging the fixation of quantum of compensation for the acquisition of 77.80 acres of land which includes 20 acres of grove land.

2. The referring court fixed the compensation based on the exemplar of the rate of Rs 7 per square yard deducting Rs 2 fixing the rate at Rs 5 per square yard for the agricultural land. The submission is, for agricultural land, computation should be based on capitalisation of annual income of crops, as per guideline contained in Chapter 482(3) of Revenue Manual, compensation should be eight times of the value of annual crop (bagh bahar) and not per square yard. The aforesaid fixation at the said rate by the reference court was confirmed by the High Court. To appreciate the controversy, we are herewith giving a short matrix of facts:

The claimant in the present case is one Shri Malik Sartaj Wali Khan, who has alleged, his landed property measuring 77.80 acres situated in Village Bihar Man Nagla, Pargana Tehsil and district of Bareilly has been acquired and the compensation amounting to Rs 6,07,786.10p. has been awarded by the Land Acquisition Officer, Bareilly through an award dated 22-10-1973. Being aggrieved by that, the appellant filed an appeal against the fixation of the value of the land, tubewell, kothi etc. The case set up before the referring court was that the prevailing market price, on the relevant date with regard to the land in question was ranging between Rs 6.50 to Rs 10 per square yard in the locality and in its neighbourhood, though he actually claimed at the rate of Rs 6.50 per square yard. In support of the potentiality of the said land, the claimant's case is, this land is situated on Bareilly-Pilibhit State Highway which has great potential value and is situate just opposite to Indian Veterinary Research Institute, Bareilly. The land is almost adjoining the municipal limits of the Nagarpalika. In fact, the appellant Committee itself negotiated privately to settle this land and vide resolution dated 26-3-1971 offered Rs 14 lakhs towards its sale consideration, both for the land and building. On the other hand the appellant's case is, since it required to set up market committee, hence, acquisition was moved for acquiring this land. Submission is, the respondent claimant had difficulties to dispose of his land as before this, he had to obtain permission of the District Judge. They were finding difficulties in its maintenance as it was economically not viable. The appellant had denied the rate of land in that area to be between Rs 6.50 to Rs 10 per square yard. The main plank of submission for the appellant is with reference to the fixation of rate as per Paper No. 104/C, the sale deed dated 20-10-1970 executed by Respondent 1 Mr Sartaj Wali Khan, in favour of Sardar Kalyan Singh showing the rate for the land in Village Bihar Man Nagla to be Rs 4.50 per square yard. It was denied that the rate of land ranged between Rs 6.50 to Rs 10 per square yard. On the other hand, learned counsel for the respondent claimant has referred to some of the exemplars to show that the market value of the portion of Plot No. 1173 which is adjacent to the land ranged between Rs 6 to Rs 8 per square yard.

3. The pith and substance of the submission on behalf of the appellant is that it being an agricultural land, the valuation should not be fixed per square yard but should be per acre. To rebut this, learned counsel for the respondents submits, if the fixation at Rs 5 per square yard is computed in acreage, it will come to about Rs 23,000 per acre. So mere reference per square yard or per acre would make no difference, if the valuation is fixed as per the record based on acceptable exemplars. The appellant referred to the case of Special Land Acquisition Officer v. Tajar Hanifabi. Though it was a case of agricultural land, no such principle was laid down that agricultural land must be computed per acre. Reliance was also placed on the decision in State of M.P. v. Harishankar Goel. It was a case where fixation of valuation of land was based on per square feet and was held to be per se illegal. However, this decision does not go further to state that agricultural land can only be computed in terms of acre. In fact this very decision further records: (SCC p. 489, para 4)

"Having found that the lands were possessed of potential value the compensation could be determined on the basis of the market value on square-yard basis."

4. On the contrary, this decision though was with reference to agricultural land, it was computed on the basis of per square yard. The referring court had relied on the sale deed, which is Paper No. 31C executed by the Bareilly House Building Cooperative Society Limited in favour of the U.P. Avas Evam Vikas Parishad in which the sale price fixed therein was Rs 7 per square yard. It is not in dispute, this land was within the municipal limits, hence 38% was reduced out of the said rate to bring the rate to be at Rs 5 per square yard. It is submitted for the appellant that this land was neither the land in the same village nor was one outside the municipal limits. Further the placement of the land could not be said to be the same as the acquired land.

5. Thus the question before us is, whether the referring court while accepting this has committed any such error which calls for interference by this Court in the present proceedings. The referring court while considering this, has first referred to the situation of the land, which is hardly half a furlong away from the municipal octroi limits. In other words, it is very near to the municipal limits of the city of Bareilly. Notwithstanding that the said land under Paper No. 31C not being the same, the main reasons for its acceptance by the referring court was that the exemplar was for the year 1970. It is much earlier than the acquisition proceeding itself and secondly, since it was in the municipal limits its rate was reduced from Rs 7 to Rs 5 per square yard. This reduction thus does not require any interference.

6. After hearing learned counsel for the parties, with reference to the fixation of the rate of compensation at best what has been submitted is based on the deed executed on behalf of the appellant, in which the claimant has sold his own land at the rate of Rs 4.50 hence the same should be fixed. The difference between Rs 4.50 and what is fixed, which is Rs 5 being very small, we do not find it to be such, specially on the facts of this case which call for our interference. This fixation of rate being the finding of fact, no interference. Hence, we uphold the valuation fixed by the referring court.

7. Learned counsel for the respondent, however, feebly submitted, that the valuation should be higher than what is fixed by the referring court. Further he referred to the exemplars showing rates between Rs 6.50 to Rs 10 per square yard. But since the claimant has not filed any appeal for the enhancement, we do feel it proper to examine or adjudicate on this.

8. Next submission for the appellant is, in any case even if the valuation is said to be fixed at Rs 5 per square yard, no reduction should be made as is submitted for the respondent towards the development charge. The submission is, it cannot be disputed that even for the development of the market yard apart from the roads, large construction of township, buildings, places for the agricultural produce which is brought and placed for selling in the market, water, electricity and other developments have to be undertaken. Hence, this deduction is inevitable which had not been done by the High Court. We have seen in the grounds of appeal before the High Court, specific grounds have been raised for such reduction. But the High Court has failed to take this into account. No deduction has been granted to the value fixed by it. We have a catena of decisions, based on the facts of each case, the deduction has been granted with varying percentages. Sometimes ⅓rd of the total value, sometimes ¼th. In our considered opinion, the High Court has committed this error. It should have reduced the said fixed value, to the extent of development charges on the said value. On behalf of the appellant what at best cited was that deduction of development charges was either by ⅓rd or ¼th of the total value. Having considered this aspect, based on the facts and circumstances of this case, we feel it appropriate and accordingly order that ¼th of the amount out of the rate of Rs 5 per square yard be deducted towards the development charges subject to the condition that the amount so reduced should not go below Rs 10 lakhs for the land in question.

9. This takes us to the next and last submission regarding the multiplier used for fixing the value of the grove. So far the valuation of Rs 25,000 for grove and Rs 5000 for other crops is not in dispute. The only dispute is in terms of the multiplier. The referring court has applied the multiplier of 20 which is the subject-matter of challenge by the appellant. The appellant had relied on the decision of this Court in Special Land Acquisition Officer v. Virupax Shankar Nadagouda. This is a case where 10 years? multiplier is used and it set aside the multiplier of 15 years. This matter was with reference to the bagayat land where the sugarcane crop was grown. Next reliance was placed on the decision in State of Gujarat v. Rama Rana4. This case holds: (SCC p. 694, para 5)

"The appropriate multiplier should be of 10 years as settled by several judgments of this Court."

10. On the other hand, learned counsel for the respondent claimant has referred to the decision in Koyappathodi M. Ayisha Umma v. State of Kerala. This was a case where reliance was placed on multiplier of 15 years. However, we find, in this case, no dispute was raised for the 15 years? multiplier either before the trial court or the High Court. Since it was not disputed, this decision would be of no avail for lending support that 15 years? multiplier should be used.

11. In view of the decisions of this Court, on the facts and circumstances of this case, in our considered opinion the multiplier of 10 years would be a proper multiplier for fixing the value in question. Accordingly, the present appeal is partly allowed. Costs on the parties.

12. Since the matter is pending for a long time, the appellant shall make early calculation of the amount payable, in terms of this decision for the payment of the balance compensation payable to the claimant preferably within the period of three months from today and also pay the same within this period. It will include the solatium as per the judgment.

Appeal partly allowed.