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SUPREME COURT OF INDIA
S.Abdul Nazeer, Krishna Murari, JJ.
State Of Madhya Pradesh & Anr. – Appellant(s)
Versus
Radheshyam & Ors. – Respondent(s)
Civil Appeal Nos. 8857-8858 of 2022 (arising out of S.L.P (C) Nos. 19707-19708 of 2018)
Decided On : 24-11-2022
Land Acquisition Act - Determination of Market Value and Deduction for Development Charges - Section 4(1), Section 17(1), Section 6, Section 18 - [Land Acquisition Act, 1894, Section 4(1), Section 17(1), Section 6, Section 18]
Fact of the Case:
The case involved the acquisition of land for the rehabilitation of displaced persons due to the increase in the height of the Sardar Sarovar Dam. The landowners sought enhancement of compensation through a reference under Section 18 of the Land Acquisition Act, 1894. The Reference Court enhanced the compensation, which was further appealed by both the Appellant State and the Respondent Landowners.
Finding of the Court:
The High Court partly allowed the appeals filed by the Respondent landowners and dismissed the appeals of the Petitioner State by reducing the deduction for both the components to 35% on the market value of the acquired land. The Court also corrected the market value for irrigated and unirrigated land in a subsequent order.
Issues: The main issues were the determination of the market value of the acquired land and the deduction to be made towards utilization of land and development charges.
Ratio Decidendi: The Court held that the determination of the market value of the land should be based on the prevailing price on the date of the preliminary notification, with consideration given to positive and negative factors. The Court also emphasized the need for evidence and material to justify the application of market value determined in a different case. Regarding the deduction for development charges, the Court reiterated the need for evidence and material to determine the ratio of deduction, emphasizing that there is no straight jacket formula for such deductions.
Final Decision: The High Court's judgment was set aside, and the matter was remitted back to the High Court for fresh consideration to determine the compensation appropriately in accordance with law and by taking into account the settled principles and all the relevant evidence and material available on record for the irrigated as well as the unirrigated land. The High Court was also directed to re-determine the deduction to be made towards development charges afresh taking into account all the relevant evidence, facts, and materials on record.
JUDGMENT :
Krishna Murari, J.
Leave granted.
2. These appeals are directed against the orders dated 20.06.2016 and 08.09.2017 passed by the High Court of Madhya Pradesh Bench at Indore (hereinafter referred to as “High Court”) in First Appeal No. 131 of 2010 and MCC No. 304/2017 respectively. By the said orders, the High Court allowed the MCC as well as first appeal and dismissed the appeals of the Appellant State by reducing the deduction awarded by the Reference Court from 65% towards largeness of plot + 48% towards development to 35% on the market value of Rs.1,04,64,000/-per hectare for the irrigated land and Rs. 69,76,000/-per hectare for the un-irrigated land.
3. Brief facts necessary for the disposal of these appeals are as under:
3.1. A Notification dated 27.02.2004 u/s 4(1) read with Section 17(1) of the Land Acquisition Act, 1894 (hereinafter referred to as “the act”) was published in the official gazette for acquisition of land admeasuring 38.178 hectares of Village Sala, Tehsil, Dharampuri, District-Dhar for the purpose of “rehabilitation of displaced persons” of villages which came under the submergence due to increase of height of Sardar Sarovar Dam. A declaration under Section 6 of the Act in respect of Village Sala was issued on 14.05.2004, 11.05.2004 and 05.05.2004, respectively.
3.2. The Land Acquisition Officer (hereinafter referred to as “LAO”) vide award dated 23.12.2004 passed an award for the acquired land in Village Sala, District-Dhar, MP, wherein the learned LAO assessed the market value and awarded compensation which is enumerated as below:
| i. | Irrigated Land | Rs. 47,165/- per hectare |
| ii. | Unirrigated Land | Rs. 29,621/- per hectare |
| iii. | Solatium | 30% |
| iv. | Additional Compensation | 12% |
3.3. The Respondent landowners being dissatisfied with the amount of compensation, sought Reference under Section 18 of the Act claiming enhancement of compensation. The Reference Court vide order dated 09.09.2009, after determining the market value of the irrigated land to the tune of Rs. 36,62,400 per hectare and unirrigated land to the tune of Rs. 24,41,600 per hectare on the basis of sale deeds filed as exemplars enhanced the compensation along with 48% deduction towards development charges. The enhanced compensation made by reference court is enumerated as below:
i. Unirrigated land – Rs. 24,41,600 – 48% deduction = Rs.11,71,968/- per hectare
ii. Irrigated Land - Rs. 36,62,400 – 48% deduction = Rs.17,57,952/- per hectare
iii. interest @ 12% per annum on enhanced compensation from 27.02.2004 to date of passing of award on 23.12.2004
iv. solatium @ 30% of enhanced compensation.
It is pertinent to mention here that the Reference Court assessed the market value of land of the village sala on the basis of sale deed Ex-P/2 dated 11.02.2002, Ex-P/3 dated 06.05.2002 and Ex-P/4 dated 04.02.2004 measuring 0.017 hectare, 0.013 hectare and 0.011 hectare, respectively.
3.4. The Appellant State as well as the Respondent Landowners filed appeals before the High Court assailing the order dated 09.09.2009 passed by the Reference Court. It was contended by the Appellant state that the enhancement of compensation by the Reference Court from the amount awarded by the LAO is on the higher side and that the enhancement on the basis of small exempliers is contrary to the law settled by the Apex Court. It was contended by the Respondent landowners that the Reference Court erred in law in deducting 65% from the market value on account of development charges and other possible expenditure and looking to the fact that the land was acquired for “rehabilitation of displaced persons”, deduction of around 25% from the market value would be justifiable.
3.5. The High Court vide impugned judgment and final order dated 20.06.2016, partly allowed the appeals filed by the Respondent landowners and dismissed the appeals of the P
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(1) Acquisition of land – When large extent of lands are acquired and if sale exemplar, also for large extent is available on record it would be safer to rely on same if they are comparable transacti....
The market value of the acquired land can be determined by considering evidence such as sale deeds and witness testimonies, and making reasonable deductions for developmental costs.
The main legal point established in the judgment is the application of the principles of 'Reduction and Deduction' and valuation of agricultural land in determining just and fair compensation for acq....
The main legal point established in the judgment is the relevance of sale instances/exemplars from the acquired land for determining the market value and the appropriateness of deductions towards dev....
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