Judgement

P. JAGANMOHAN REDDY, J. :- These appeals are by certificate against the judgment of the Patna High Court in land acquisition appeals. Two notifications dated 7-7-1954 under S. 4 of the Land Acquisition Act 1894 (Act 1 of 1894) (hereinafter called the Act ), were issued one in respect of a portion of Plot Nos. 178 and 1784 admeasuring 2.65 acres and the other in respect of the whole of the plot No. 1783 admeasuring 2 acres situated in Ward No. 3 of Ranchi Municipality. Section 6 notification in respect of these lands was published on 7-9-1954 and possession was taken on 23-9-1954 under S. 17 (1) after making a declaration under section 17 (4) that the provisions of section 5A shall not apply. The Collector awarded compensation of Rs. 1,20,419-6-11 in respect of the first acquisition and Rs. 47,648-13-6 in respect of the second. Thereafter, at the instance of the claimant, a reference under S. 18 of the Act was made to the Judicial Commissioner of Chhota Nagpur, Ranchi who, while maintaining the market value of the land awarded by the Collector, gave further compensation for severance at the rate of 5% and 10% in respect of potential value of the land. The Judicial Commissioner, however did not grant the 15% solatium under section 23 (2) of the Act. Being dissatisfied, the claimants preferred appeals to the High Court. The High Court revised the compensation and awarded Rs. 90,000/- per acre and 15% as solatium on the market value under section 23 (2) of the Act but did not grant them the 5% towards severance Interest at 6% per annum on the amount of enhanced compensation from 23-9-1954 together with costs was also decreed. Against the judgement and decree, the claimants have filed Civil Appeals 661 & 1380/67 while the State has filed Civil Appeals 1885-86/67.

2. The lands in question which have been acquired were earlier leased on 22-9-1944 to the Military authorities on a rent of Rs. 600/- per month for period of 6 months under a registered lease deed with option to renew for a maximum period of 10 years which period expired on 21-9-1954 One of the conditions of the lease was that on the termination of the lease, the lessor would exercise the option given under the lease to purchase all buildings, structures gardens and any other structures constructed by the lessee during their occupation of the leased property, at 75 per cent of the valuation that would be determined by the Superintending Engineer, Chhota Nagpur Circle, and in case the lessors refused to purchase, the lessee was entitled to dismantle and take away the materials. Towards the end of the lease period, the Government of Bihar decided to acquire the property for the State Soldiers. Sailors and Airmen s Board and initiated proceedings as aforesaid.

3. In these appeals the only question that has to be determined is What is the market value of the property as on the date of section 4 notification? In the valuation report given by the Land Acquisition Officer, Ranchi, Ex.-1 the principle of capitalisation on the basis of 20 times the annual rental of Rs. 7,200/- at the rate of Rs. 600/- p.m. was adopted as the price of the lands. In that report it was also pointed out that the sale price of 1,085 acres out of the premises of the Ranchi Club as per registered sale-deed, Ex. C-1 dated 1-4-1953, was Rs. 41, 470/- per acre, which was not fair. Apart from these, 25 other sale transactions in respect of portions of Plot No. 1789 between 1952 and 1953 were also referred in that report. Some of those lands were situated opposite to the Ranchi Club and the sale price came to Rs. 1092/- per katha, which is about Rs. 60,000/- per acre. It was further pointed out that some other lands a little further away from the main road but belonging to the same Plot No. 1789 were sold at the rates between Rs. 250/- to Rs. 800/- per katha. This report formed the basis of the award made by the Collector. The High Court took judicial notice, and in our view rightly so, that after the