ORDER

1. This appeal by special leave at the behest of the claimant arises from the judgment of the Division Bench of the Bombay High Court at Goa Bench dated 5-12-1988 made in First Civil Appeal No. 54 of 1986. Notification acquiring an extent of 21,920 sq. metres situated in Chicalim Village near Goa Airport was notified in the Gazette dated 6-7-1970 under Section 4(1) of the Land Acquisition Act, 1894, (for short the Act) for the Naval Air Station. The Land Acquisition Officer in his award dated 26-3-1976 determined the compensation at Rs 5 per sq. m. Possession was taken on 28-2-1977. On reference under Section 18, the District Judge determined the compensation by his award and decree dated 31-3-1986 at Rs 50 per sq. m. Feeling aggrieved against the above enhanced market value, the State went in appeal. The High Court, as stated earlier, allowed the appeals reversed the award and decree of the reference court and confirmed the award of the Collector.

2. Shri R.F. Nariman, learned Senior Counsel for the appellant strenuously contended that from the evidence on record, it would be clear that the lands are possessed of potential value for building purposes. The appellant himself purchased the property for construction of staff quarters for its officers. The Company had applied for permission for construction. In the meanwhile, they developed the land and kept the material ready for construction. At that point of time, the notification came to be published. Four sale instances brought on record do indicate that there was rising trend in the market value of the lands when sold out in small plots. Though the small plots ipso facto may not form the basis per se to determine the compensation, they would provide the foundation for determining the market value. On its basis, giving proper deduction, the market value ought to be determined. The High Court, instead of adopting that procedure, had concluded on wrong premise that the lands are situated at 6 kms away from the developing lands and held that the sale instances are irrelevant and having excluded those sale instances confirmed the award given by the Collector. The potential value was not taken into consideration to determine compensation. The view taken by the High Court is, thereby bristled with illegality warranting interference. Learned counsel for the State contended that the sale instances not only are small but few of them are post-notification sales. The land under acquisition has no approach road. There was a freeze for development. In view of these facts, there would be no potential buyers for the land in question. The appellant himself had purchased the property for the purpose of constructing the staff quarters but not for sale to the third party. Having realised that the property would be acquired for public purpose, the Government had frozen the appreciation with a view to see that the proper market value would be determined. The High Court, therefore, kept these facts at the back of its mind above (sic) consideration rightly and agreed that the market value would only be at Rs 5 per sq. yd. and the District Judge was not justified in relying on sale instances to determine the market value.

3. Having given our anxious consideration to the respective considerations, the question that would arise for consideration is whether the High Court was right in determining the market value @ Rs 5 per sq. yd. Indisputably, the appellant had purchased the very land in 1965 for a total consideration of Rs 60,000. He intended to use this property for the purpose of construction of staff quarters and for his own use. The Land Acquisition Officer has taken that factor as a base and then considered to what extent the appellant is entitled to the determination of the compensation. We think that the Land Acquisition Officer is right in starting with that premise and then to determine the market value. It is also an admitted fact that till April 1969 there was a freeze in the sale of t