1. Land acquisition under Land Acquisition Act, 1894 — Dispute over adequacy of compensation for dry lands acquired for house sites — Reference for enhancement of market value. (Para 2 , 7 , 8 , 9 )
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2018 Supreme(SC) 348
SUPREME COURT OF INDIA
R.K. AGRAWAL, ABHAY MANOHAR SAPRE, JJ.
Manimegalai – Appellant
Versus
The Special Tahsildar (Land Acquisition Officer) Adi Dravidar Welfare – Respondent
CIVIL APPEAL NOs. 2294-2295 OF 2011
Decided on : 16-04-2018
Important Points
IMPORTANT POINTS
Reasonable compensation means price of land to be paid by a willing buyer to the willing seller.
Act does not provide for “just terms” or “just compensation”, but the market value.
Compulsory acquisition can be made only for a public purpose.
Reasonable compensation means price of land to be paid by a willing buyer to the willing seller.
Act does not provide for “just terms” or “just compensation”, but the market value.
Compulsory acquisition can be made only for a public purpose.
Subject
Land Acquisition - Compensation
Act Referred
Headnote
(a) Land Acquisition Act, 1894 – Section 23 – Reasonable compensation – Price of land to be paid by a willing buyer to the willing seller – Act providing not for “just terms” or “just compensation” but the market value. (Para 10)
(b) Land Acquisition Act, 1894 – Section 4 – Public purpose – Compulsory acquisition can be made only for a public purpose. (Para 11)
(c) Land Acquisition Act, 1894 – Section 23 – Reference court rightly awarded compensation after considering all factors. (Para 15)
Facts of the case:
The Land Acquisition Officer passed an Award determining a sum of Rs. 400/-per cent as compensation to the appellant herein.
A Reference was sought, seeking market value for the acquired lands at the rate of Rs. 20,000/- per cent. The subordinate Judge granted compensation at the rate of Rs. 2,500/-per cent together with 30% solatium and 12% additional amount from the date of issue of Notification.
The Respondent filed A.S. before the High Court. Single Judge of the High Court allowed the appeal filed by the respondent by reducing the amount of compensation granted by learned subordinate Judge from Rs. 2,500/-to Rs. 1,670/-with solatium and other statutory benefits.
Finding of the Court:
High Court was not correct in interfering with order of Reference Court.
Result: Civil Appeal No. 2294 of 2011 allowed and Civil Appeal No. 2295 of 2011 dismissed.
Legal Category Hierarchy
Table of Contents
2. Appellant contends compensation is abnormally low and ignores potential value — Respondent argues compensation is high relative to vicinity and remaining land is usable. (Para 5 , 6 )
3. Compensation assessment must consider land location, potential for development, proximity to developed areas, and the willing buyer-willing seller principle, rejecting data lands separated by physical barriers. (Para 10 , 12 , 13 , 14 , 15 )
4. Market value for compensation should be determined by the land's potential and proximity to developed areas, using comparable sale deeds of adjacent lands rather than dissimilar data lands. (Para 10 , 15 )
5. High Court order set aside — Order of the Reference Court restoring higher compensation reinstated. (Para 16 )
6. How is market value determined for land acquisition compensation?
Market value is assessed based on the price a willing buyer would pay a willing seller, considering the land's location, potential for development, proximity to developed areas, and its specific use or unique features upon acquisition. (Para 10 )
7. What constitutes public purpose in land acquisition?
Public purpose serves the general interest of the community rather than individual interests. While the executive is generally the best judge, it is subject to judicial scrutiny to ensure the acquisition benefits the public welfare. (Para 11 )
8. When can a data land be rejected for determining compensation?
A data land can be rejected if it is not similar to the acquired land, such as when a physical barrier like a railway track separates them, making the lands dissimilar in nature and potential. (Para 13 , 15 )
9. What factors influence the assessment of compensation for acquired land?
Assessment must account for the nature of the land, current use, capacity for higher potential, precise location relative to adjoining land, and the impact of neighboring land use. (Para 15 )
JUDGMENT :
R.K. Agrawal, J.
1. The above appeals have been filed against the judgment and order dated 06.11.2009 passed by the High Court of Judicature at Madras in A.S. Nos. 88 and 601 of 2001 and Cross Objection No. 27 of 2007 whereby learned single Judge of the High Court allowed the appeal filed by the respondent while dismissing the cross objection filed by the appellant herein.
2. Brief facts:
(a) On 15.09.1993, the Government of Tamil Nadu, issued a Notification under Section 4(1) of the Land Acquisition Act, 1894 (in short ‘the LA Act’) for acquisition of dry lands for the purpose of providing house sites to 250 landless poor Adi Dravidars in Acharapakkam Village, Madurandagam Taluk, Chengai, MGR District, Madras, having an extent of 4.30.0 hectares or 10.62 acres.
(b) The lands belonging to the appellant herein in Survey Nos. 300/2A2, 300/3, 302/1A, 302/4, 317/1B2, 302/2B2B and 320/2C2 were part of the said acquisition. The Land Acquisition Officer, after complying with the formalities required in connection with the acquisition of land under the LA Act, passed an Award dated 22.03.1995, determining a sum of Rs. 400/-per cent as compensation to the appellant herein.
(c) Being aggrieved by the meager compensation, a Reference under Section 18 of the LA Act was sought, seeking market value for the acquired lands at the rate of Rs. 20,000/- per cent before the Subordinate Court, Madurantagam which was filed as L.A.O.P. No. 120 of 1998. Learned subordinate Judge, vide judgment and order dated 27.03.2000, granted compensation at the rate of Rs. 2,500/-per cent together with 30% solatium and 12% additional amount from the date of issue of Notification dated 15.09.1993.
(d) Respondent herein, being aggrieved by the judgment and order dated 27.03.2000, filed A.S. No. 88 of 2001 before the High Court. Learned single Judge of the High Court, vide judgment and order dated 06.11.2009 allowed the appeal filed by the respondent herein by reducing the amount of compensation granted by learned subordinate Judge from Rs. 2,500/-to Rs. 1,670/-with solatium and other statutory benefits.
(e) Aggrieved by the judgment and order dated 06.11.2009, the appellant has filed these appeals by way of special leave before this Court. 3) Heard Mr. V. Prabhakar, learned counsel for the appellant. None appeared from the side of the respondent and perused the records.
Point for consideration:-
4. Whether in the present facts and circumstances of the case the decision of the High Court is just and reasonable in reducing the compensation?
Rival submissions:-
5. Learned counsel for the appellant contended that the compensation awarded for the acquired lands was grossly inadequate and abnormally low and does not reflect the correct market value of the said lands. He further contended that the market value of the acquired lands at the relevant time was not less than Rs. 20,000/-per cent. The potential value of the acquired lands and rise in price were not considered by the Land Acquisition Officer. Learned counsel finally contended that the High Court also erred in law while computing the market value of the lands in question and interference by this Court is sought for in this regard.
6. It was the stand of the respondent before the courts below that the entire land belonging to the claimant was not acquired but a portion of it alone was acquired. The remaining portion could be used by the claimant. Further, the respondent is not entitled to pay compensation for the unacquired land. It was further the stand of the respondent that the compensation awarded to the claimant is already on the higher side as compared to the compensation awarded to the lands in vicinity and no interference is sought for by this Court in this regard.
Discussion:-
7. The Government of Tamil Nadu issued a Notification for the acquisition of dry lands, also known as punja lands, for the purpose of providing house sites to the people. Certain punja lands belonged to the appellant herein in Survey N
