The court established that compensation for acquired land must reflect market value based on bona fide transactions and proximity to acquisition date, requiring adjustments for development purposes.

JUDGMENT :

J.K. MAHESHWARI, J.

1. Arising out of the order dated 20.07.2015 passed by the High Court of Gujarat in the First Appeal No. 1036 of 2002 preferred by the legal representatives of the original claimant, assailing the award dated 05.11.2001¹[Land Acquisition Case No. 394 of 1989] passed by the Reference Court; which was against the award passed on 30.07.1988²[LAQ Case No. 2397] by Special Land Acquisition Officer (in short ‘LAO’), the present appeal has been preferred. In this appeal, the adequacy of compensation granted by the LAO, the Reference Court and also the High Court has been questioned.

2. For the sake of convenience, it is noted that the subject land is non-agricultural bearing Survey No. 25, admeasuring about 33387 sq. mtrs., situated at village/taluka ‘Mehmedabad’, District – Kheda, Gujarat, which was acquired by Gujarat Housing Board for residential/housing/construction purpose. The notification under Section 4 of the LAND ACQUISITION ACT , 1894 (hereinafter referred to as ‘LAA’ for brevity) was published on 30.07.1985, followed by notification under Section 6 dated 31.07.1986. After inviting objections, compensation at the rate of Rs. 4.50/- per square metre was determined by LAO, which was enhanced to Rs. 45/- per square metre by the Reference Court along with 30% solatium on the market value, 10% severance charges, plus 12% per annum interest from the date of publication of notification under Section 4 till the date of Award/date of taking possession of the land whichever is earlier, plus 9% interest for one year from the date of taking of possession and 15% per annum till realization. In appeal, the High Court further enhanced the compensation to Rs 53/- per square metre, including other statutory benefits as granted by the Reference Court.

3. Mr. Harish Raval, learned senior counsel, appearing on behalf of the appellants has placed reliance on the letter of allotment – Exhibit 44, made in January, 1985 by the Collector of the district to one Harishchandra Hiralal Dalwadi of Survey No. 864, at the rate of Rs. 65/- per square metre. The said land was adjacent to the subject land. He further relied upon Exhibit 53, i.e., the sale deed dated 29.08.1985 of an adjoining land, executed within a month from the date of notification of Section 4 LAA, indicating the value at Rs. 152.37/- per square metre. In reference to these exemplars, learned Senior Counsel submitted that compensation as allowed by the Reference Court and High Court is inadequate.

4. It is also urged, potentiality of the land acquired is a relevant factor; the land belonging to appellants is a piece of Survey No. 25, and is one kilometre away from the railway station and bus stand, as admitted by the departmental witness in his statement. Therefore, adequacy of compensation awarded by the Reference Court, marginally enhanced by the High Court, is not proportionate to the value of the land. In support of the said submissions, reliance has been placed on the judgment of ‘Union of India v. Raj Kumar Baghal Singh (Dead) Through Legal Representatives and Others, (2014) 10 SCC 422’ and also in ‘Mehta Ravindrarai Ajitrai (Deceased) Through His Heirs and LRs. and Others v. State of Gujarat, (1989) 4 SCC 250’ and enhancement of fair and reasonable amount of compensation has been prayed for.

5. Per contra, learned counsel representing the State has strenuously urged that exemplar Exhibit 44 is merely an allotmen