IMPORTANT POINTS:
" When the fair value fixed in respect of a property is shown to have higher value than the compensation offered, public officials are bound to explain reasons for offering such lesser amount, lest undue influence will have to be presumed. The compensation now fixed, no doubt, no prudent man would accept in any circumstances.

1. This is an unusual case where this Court is called upon to decide the validity of an agreement executed by the petitioners under Section 11(2) of the Land Acquisition Act, 1894 (for short, the “LAA 1894”) on principles of private law applicable to a contract.

2. The central issue that also arises in this case is, what is the extent of the judicial power in public law to interfere with an agreement entered into between public officials and private persons.

3. The petitioners are wife and children of one Abdullakutty. They belong to a marginalised group in social strata as revealed before this Court from the report of the District Legal Services Authority, Thrissur. The said report was furnished pursuant to the direction of this Court. The petitioners were owners of 0.119 hectares of land in the heart of Thrissur town, precisely located at Ayyanthole. This land was notified for acquisition for the development of West Fort Chungam Model road at Thrissur. Invoking urgency clause, a notification under Section 4(1) of the LAA 1894 was issued on 11.12.2012. Section 11(ii) of the Land Acquisition Act, 1961 (Kerala) permits the Collector to pass an award based on the agreement with the persons, who are interested in the land. Accordingly, fixing the land value at Rs.7,50,000/- per cent, the petitioners agreed to surrender the land. There is a prescribed format to pass an award based on the agreement. Form No.10(a) of the Land Acquisition (Kerala) Rules, 1990 (for short, the “Rules 1990”) prescribes the mode of agreement. Rule 12(5) of the Rules 1990 prescribes that it shall be in Form No.10(a). It is specifically stipulated in Rule 12(5) that the agreement shall be executed between the owner or owners of the land on one part and the District Collector for and on behalf of the Government of Kerala on the other part. This agreement is not compulsorily registerable in the light of Section 11(4) of LAA 1984. In this case, admittedly, the District Collector had not executed any agreement. This agreement can be made as an award in the light of Section 11(2) of the LAA 1894.

4. The compensation was fixed at Rs.22,05,000/- for 0.119 hectares and Rs.88,442/- towards the compound wall. As per the fair value register, the land value is Rs.34,58,000/- per Are. The centage value would then work out to Rs.14,00,000/- (Rupees fourteen lakhs only). The petitioners were paid compensation at Rs.7,50,000/- much below the fair value. The petitioners have a case that the market value of the land was Rs.30,00,000/- per cent. The petitioners were told that if the petitioners were not agreeing, the compensation amount would be less if an award is passed otherwise. Believing and placing trust on public officials, the petitioners signed the agreement.

5. The petitioners challenge the award of compensation alleging arbitrary fixation of compensation and also on the ground of non-compliance of procedural formalities for signing the agreement.

6. What is the scope of enquiry in public law in regard to the validity of an agreement? There is no distinction between an agreement entered into between the private persons or private persons with the public officials. However, in a contract entered into with public officials, the Court can still examine the fairness of procedure adopted by the public officials. The Court possesses a remedial discretion in cases where the Court finds the action of public officials are questionable on any principles on which such actions can be questioned under private law. However, the Court has to exercise power circumspectiously. The power can be exercised only when the Court can formulate an opinion based on the records that such an agreement is vitiated. The Court cannot convert jurisdiction of judicial review in a like manner adjudicating a civil dispute. Article 14 of the Constitution of India postulates principles of fairness. Therefore, the administrative authorities are bound to act fairly. What is fairness, is a matter of