Judgment :

Dr. Mukundakam Sharma, J.

1. This appeal is directed against the judgment and order dated 27.11.2002 passed by the Madras High Court whereby the High Court reversed the order passed by the Reference Court by reducing the amount of compensation granted by the Reference Court to the appellant from Rs. 17/- per sq. feet to Rs. 9/- per sq. feet.

2. Before we deal with the contentions raised before us, brief facts leading to the filing of the present appeal are required to be stated. For providing house sites at Adi Dravidas, land measuring an extent of 3.90 acres comprised in Survey No. 118/A in Palangudi Village was acquired by the Government of Tamil Nadu by issuing a notification under Section 4(1) of the Land Acquisition Act which was published on 23.9.1992. The Land Acquisition Officer awarded a sum of Rs. 1.72 per sq. ft. for the acquired land. At the instance of the aggrieved land owner, i.e. the appellant, reference was made under Section 18 of the Land Acquisition Act before the Additional Sub Court, Trichy.

3. Before the Reference Court, the appellant adduced documentary evidence in the form of Sale Deeds Exs. A1 to A4 and examined two witnesses. The Revenue also produced documents exhibited as Exs. B1 and B2, but no witness was examined from the side of the Revenue. The Reference Court after consideration and appreciation of the evidence adduced fixed the market value of the acquired land at Rs. 17/-per sq. feet.

4. Being aggrieved by the said order, the State preferred an appeal before the High Court. The question for consideration before the High Court was whether the amount of compensation for the acquired land fixed by the Reference Court i.e. Rs. 17/-per sq. feet is correct or not and whether the appeal filed by the State for reducing the amount of compensation be allowed.

5. The High Court after consideration of the records came to the conclusion that the amount of compensation i.e. Rs. 17/-per sq. feet is on the higher side, and that the appropriate amount of compensation would be Rs. 9/-per sq. feet and accordingly reversed the order passed by the Reference Court with the aforesaid modification of the rate of compensation fixing the same at Rs. 9/- per sq. ft.

6. The appellant, original owner of the land, has filed this appeal praying for setting aside the order passed by the High Court and has prayed for enhancement of the amount of compensation taking into consideration the potential value of the land.

7. The learned counsel appearing for the appellant contended that the High Court took notice of the market value of the acquired land only with reference to the actual use. According to the appellant, the Court failed to take notice of its value with reference to the better use to which it is reasonably capable of being put to in the immediate or near future and thereby failed to take into consideration future potentiality of the land and instead based itself only on the realized possibility and thus committed an error.

8. The learned counsel appearing for the respondent, on the other hand, contended that the amount of compensation granted by the High Court is appropriate, and does not deserve to be interfered with.

9. The Reference Court granted compensation at Rs. 17/-per sq. feet after holding that the acquired land is a potential house site being located in a very important locality and that the amount of compensation granted by the Land Acquisition Officer, i.e., 1.72 per sq. ft. was totally an unjust and inadequate amount.

10. The High Court, on the other hand, fixed the market value of the acquired land at Rs. 9/- per sq. ft. by setting aside the order passed by the Reference Court. The High Court while coming to the aforesaid conclusion held that Ex. A3 is a comparable sale transaction. Under Ex. A3, 1710 sq. ft. land was sold for Rs.20,000/- which would work out to Rs. 11/- per sq. ft. Nonetheless, the High Court also pointed out the fact that the acquired land has got higher potential value,