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SUPREME COURT OF INDIA
H.R. KHANNA, R.S. SARKARIA AND JASWANT SINGH, JJ.
Dadoo Yogendranath Singh and others, Appellants
Versus
The Collector, Seoni, Respondents.
Civil Appeal No. 2128 of 1969,
D/- 25-1-1977.
Advocates appeared
Mr. M.S. Gupta, Advocate, for Appellants; Mr. Ram Panjwani, Sr. Advocate, (Mr. H.S. Parihar, Advocate with him), for Respondent.
Land Acquisition Act - Section 17 – Acquisition of Land – Claim of compensation - Contends that High Court was not right in holding that there was no evidence to show that land in question had potential value as buildings sites - It is submitted that High Court has simply ignored that evidence - In this connection Counsel has referred to evidence on record showing that appellants had before the acquisition, paid diversion charges to Government, at per acre in respect of adjoining land, for bringing it into use as building site - Counsel has further referred to the evidence showing that land in question is close to a built up quarter of town and is within Municipal limits - Appearing for Respondent submits that this evidence was much too insufficient to establish potential value of land as building sites because existing buildings in vicinity of this land are old buildings – Held, A vendor willing to sell his land at market value will take into consideration a particular potentiality or special adaptability of the land in fixing the price. It is not the fancy or the obsession of vendor that enters the market value, but the objective factor namely, whether the said potentiality can be turned to account within a reasonably near future - Question therefore turns upon the facts of each case - In context of building potentiality many questions will have to be asked and answered, whether there is pressure on the land for building activity, whether the acquired land is suitable for building purposes whether extension of the said activity is towards the land acquired, what is the pace of the progress and how far said activity has extended and within what time, whether buildings have been put up on lands purchased for building purposes, what is the distance between the built-in-land and the land acquired and similar other questions will have to be answered. It is the over-all picture drawn on the said relevant circumstances that affords the solution - What has been extracted above are broad guidelines and not immutable absolutes - Essence of whole thing is in the sentence which has been underlined - It showed that in the ultimate analysis, the question, whether or not a land has potential value as building site, is primarily one of fact - In present case the circumstance that the appellants had voluntarily paid per acre as diversion charges, for laying out the adjoining land into plots as building sites, was of a clinching character, and taken in with the other facts, noticed above, conclusively showed that its potential value as building sites was much more than the rate of per acre awarded by the Collector and the High Court - In their application under Section 18 of Act, the appellants stated that similar land in the immediate vicinity had been sold at the rate of Rupees per acre and another plot at the rate of - These lands are close to the area for which they had paid the diversion charges at the rate of Rs. 500/- per acre. They filed a map also, showing the location of those lands. On an over-all view, after taking into account the potential value of the land, we think it will be reasonable to award compensation to appellant at the rate of per acre with interest at annum till payment from the date on which the possession was taken over by the Collector – Appeal allowed
Judgment
SARKARIA, J.:- This appeal on certificate is directed against a judgment, dated May 4, 1968 of the High Court of Madhya Pradesh. It arises out of these facts:
The appellants were owners of 7.35 acres of land being a part of Khasra No. 47/1 in the area of village Manglipeth, District Seoni, Madhya Pradesh. On November 4, 1963, a notification under Section 4 read with Section (1) of Section 17 of the Land Acquisition Act, 1894 (to be hereinafter referred to as the Act) was published in the Government Gazette stating that this land was needed by the State Govt. for implementation of Seoni Water Supply scheme. The declaration under S. 6 of the Act was published on December 18, 1963, and notices under Section 9 of the Act were issued by the Collector on 28-12-1963. In response to that notice, the appellants filed a claim that they were willing to accept compensation in respect of this land at the rate of Rs. 1500/- per acre, "as the lands adjoining this land and situated in a lesser advantageous position are sold at this rate." The Collector made his award on August 17, 1964, whereby he awarded compensation for this land at the rate of Rs. 450/- per acre. The total amount awarded for this piece of land after adding solarium at the rate of 15% was Rupees 3,804/-. He also awarded interest at the rate of 4% from September 19, 1964, on which date, the Collector had taken over possession of the land.
2. Dissatisfied with the Collectors award, the appellants made an application under section 18 of the Act for reference to the District Court for enhancement of the compensation. The Collector accordingly made a reference. The additional District Judge, Seoni, who heard the reference, enhanced the compensation to Rs. 11,000/- per acre. In this way after adding solatium, he awarded to the appellants, herein, a total amount of Rs. 80,850/- together with interest at the rate of 6%.
3. Against that judgment, D/- 2-5-1967, of the Additional District Judge, an appeal was preferred by the Collector, to the High Court. The High Court accepted the appeal, set aside the award of the Additional District Judge and restored that of the Collector. The High Court however, granted a certificate under Articile 133 of the Constitution.
4. The first contention of Shri M.S.Gupta, appearing for the appellants, is that the appeal filed in the High Court against the award of the Additional District Judge was not an appeal in the eye of law inasmuch as the Collector, who filed it was not competent to do so. It is stressed that no appeal was filed by the State, as such, and consequently, the incompetent appeal filed by the Collector should have been dismissed summarily on this preliminary ground without entering upon the merits.
5. This objection was raised before the High Court, also. The High Court fully considered it against the background of this case and found no substance in it. In the interests of justice we are not disposed to interfere with that finding.
6. On merits, we find, in agreement with the High Court, that the District Judge was palpably wrong inasmuch as he awarded compensation at a rate far higher than what had been claimed by the appellants themselves, pursuant to the notice under Section 9 of the Act. The learned Additional District Judge acted contrary to the legislative mandate contained in Section 25 (1) of the Act, according to which, the Court "shall not award" compensation to an applicant in excess of the amount claimed by him pursuant to any notice under Sec. 9.
7. The only question that remains for our decision is, whether the High Court was right in scaling down the compensation to Rupees 450/- per acre?
8. Mr. Gupta contends that the High Court was not right in holding that there was no evidence to show that the land in question had potential value as buildings sites. It is submitted that the High Court has simply ignored that evidence. In this connection, Counsel has referred to the evidence on record showing that the appellants had
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