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2022 Supreme(SC) 303

SUPREME COURT OF INDIA
(From the High Court of Judicature at Bombay at Nagpur)
M.R. SHAH, B.V. NAGARATHNA, JJ.
Union of India – Appellant
Versus
Premlata and Others – Respondents
Civil Appeal Nos. 176-177 of 2022
With
Premlata – Appellant
Versus
State of Maharashtra and Others – Respondents
Civil Appeal Nos.178-179 of 2022
Decided On : 06-04-2022

Advocates appeared:
For the Parties :K.M. Nataraj, ASG Indira Bhakar, Vinayak Sharma, Sharath Nambiar, Vatsal Joshi, Priyanka Das, Arvind Kumar Sharma, Gopal Shankarnarayanan, Rahul Bhangde, Satyajit A. Desai, Siddharth Gautam, Satyakam Sharma,. Ms. Anagha S. Desai, Sachin Patil, Rahul Chitnis, Aaditya A. Pande, Geo Joseph, Shwetal Shepal, Advocates

IMPORTANT POINT
Acquisition of land – Generally, sale instances with respect to small plots/parcels of land are not comparable to a large extent of land for the purpose of determining compensation.

Headnote:

Land Acquisition Act, 1894 – Sections 4 and 18 – Acquisition of land – Quantum of compensation – Reference Court enhanced amount of compensation determining market price at Rs. 6/- per square foot after making deduction of 25% of same towards development charges – Having considered fact that all sale instances were in respect of small plots, Reference Court discarded the same – All sale instances are with respect to small plots and even same instances were of year 1987 – As per settled position of law, small plots/parcels of land cannot offer same market value as when a large tract of land is purchased in an open market by a willing and prudent purchaser – Generally, sale instances with respect to small plots/parcels of land are not comparable to a large extent of land for the purpose of determining compensation – It is true that as a general rule, compensation shall not be determined on square foot basis – However, at the same time, in a given case, Court may determine compensation on square foot basis after making a reasonable deduction towards development charges, in case there are no other sale instances available – In present case, acquired land is a barren agricultural land which may have a non-agricultural potentiality – Considering fact that sale exemplars/sale deeds are in respect of very small plots of land and were non-agricultural developed plots and even the same were on highway and having access to main road, there shall be at least 40% deduction towards development charges – Impugned common judgment and order passed by High Court in First Appeal and Cross Objection modified – Original claimant shall be entitled to compensation for acquired land at the rate of Rs.6/- per square foot, subject to 40% deduction towards development charges, with all statutory benefits. (Paras 5, 6, 7 and 8)

Facts of the case:

Feeling aggrieved and dissatisfied with the impugned judgment and order dated 10.03.2021 passed by the High Court of Judicature at Bombay, Nagpur Bench in First Appeal No. 599 of 2019 and Cross Objection No. 14 of 2021, by which High Court has determined compensation for acquired land at the rate of Rs.6/- per square foot, subject to 1/3rd deduction, both, the acquiring body as well as the original claimant have preferred present appeals.

Findings of Court:

High Court has not assigned any good reason as to why and on what basis, it considered proper to make deduction towards development charges at the rate of 33.33% (1/3rd deduction). High Court has not at all considered the relevant factors while making an appropriate deduction towards development charges.

Result : Appeal allowed.

JUDGMENT :

M.R. SHAH, J.

1. Feeling aggrieved and dissatisfied with the impugned judgment and order dated 10.03.2021 passed by the High Court of Judicature at Bombay, Nagpur Bench in First Appeal No. 599 of 2019 and Cross Objection No. 14 of 2021, by which the High Court has determined the compensation for the acquired land at the rate of Rs.6/-per square foot, subject to 1/3rd deduction, both, the acquiring body as well as the original claimant have preferred the present appeals.

2. The facts leading to the present appeals in a nutshell are as under:

That a notification under Section 4 of the Land Acquisition Act, 1894 (hereinafter referred to as the ‘1894 Act’) was issued on 05.11.1992 seeking to acquire 65 Hectares 47 R land situated at Borkhedi Tahsil, District Nagpur. The said land was sought to be acquired by the Ministry of Defence for its Research and Development Organization. Acquisition proceedings in respect of 19 Hectares 79 R of the land were dropped and the actual land acquired came to about 45 Hectares 89 R. The dispute is with respect to four pieces of land bearing Survey Nos. 40, 41, 43/2 and 44 owned by the original claimant herein (appellant in Civil Appeal Nos. 178-179/2022).

2.1 The Land Acquisition Officer vide award dated 09.03.1995 awarded an amount of Rs.1,13,500/-per Hectare in respect of land bearing survey No. 43/2 and Rs.1,35,000/-per Hectare for the land bearing survey Nos. 40, 41 and 44. At the instance of the original claimant, a reference under Section 18 of the 1894 Act was made. The reference Court under Section 18 of the 1894 Act enhanced the compensation to Rs. 6/-per square foot, after making deduction of 25% towards development charges.

2.2 Feeling aggrieved and dissatisfied with the order passed by the Reference Court enhancing the amount of compensation to Rs. 6/-per square foot, after making deduction of 25%, the acquiring body preferred an appeal before the High Court being First Appeal No. 716/1996. By judgment and order dated 21.09.2016, the High Court set aside the Reference Court’s order and remanded the proceedings for fresh adjudication on the ground that sufficient opportunity was not provided to the acquiring body to contest the reference proceedings. That on remand, the Reference Court vide its judgment and order dated 28.08.2018 in L.A.C. No. 38/1995 enhanced/determined the compensation at Rs.6/-per square foot, after making deduction of 25%.

2.3 Feeling aggrieved and dissatisfied with the order passed by the Reference Court, the original claimant filed First Appeal No. 599/2019 before the High Court with a prayer to enhance the amount of compensation. The acquiring body also filed Cross Objection No. 14/2021 challenging the judgment and order passed by the Reference Court enhancing the amount of compensation at Rs. 6/-per square foot. By the impugned judgment and order, the High Court has modified the judgment and order passed by the Reference Court in L.A.C. No. 38/1995 and has held that the claimant shall be entitled to compensation for the acquired land at the rate of Rs.6/-per square foot, subject to 1/3rd deduction (instead of 25% deduction as per the judgment of the Reference Court) with all statutory benefits. Consequently, the first appeal preferred by the original claimant has been dismissed and the cross objection filed by the acquiring body has been allowed to the aforesaid extent.

2.4 Feeling aggrieved and dissatisfied with the impugned common judgment and order passed by the High Court dismissing the first appeal preferred by the original claimant and partly allowing the cross objection filed by the acquiring body, both, the original claimant as well as the acquiring body have preferred the present appeals.

3. Shri K.M. Nataraj, learned Additional Solicitor General of India appearing on behalf of the acquiring body has submitted that the acquiring body is assailing the impugned judgment and order passed by the High Court determining the compensation at Rs.6/-per square

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