1980 Supreme(Raj) 189

RAJASTHAN HIGH COURT AT JAIPUR BENCH
C.M.Lodha, N.M.Kasliwal, JJ.
Hans Raj Bahl - Appellant
Versus
State of Rajasthan and another - Respondent
D.B. Civil First Appeal No. 60 of 1970.
Decided On : 25-01-1980

The market value of the land acquired should be determined by taking into consideration its potential value as a building site, and the owner of the land is entitled to solatium at the rate of 10% on the market value of the land.

Headnote:

LAND ACQUISITION - COMPENSATION - MARKET VALUE - POTENTIAL VALUE - SOLATIUM - JURISDICTION OF COURT IN REFERENCE UNDER SECTION 18 OF THE ACT.

Fact of the Case:

Land was acquired for planned development of Jaipur City. The claimant filed a reference under Section 18 of the Rajasthan Land Acquisition Act, 1953, challenging the award and decree passed by the Civil Judge, Jaipur City.

Finding of the Court:

The Court held that the market value of the land should be determined by taking into consideration its potential value as a building site, and not just its condition and situation at the time of the declaration under Section 4 of the Act. The Court also held that the claimant was entitled to solatium at the rate of 10% on the market value of the land, as the proviso to Sub-section (2) of Section 23 of the Act, which deprives the owner of a land acquired for the purpose of an improvement or development trust, of solatium, is invalid.

Issues: 1. Whether the market value of the land should be determined by taking into consideration its potential value as a building site? 2. Whether the claimant was entitled to solatium at the rate of 10% on the market value of the land?

Ratio Decidendi: 1. The Court held that the market value of the land should be determined by taking into consideration its potential value as a building site, as the land was acquired for building activity and was situated on a developing road. The Court relied on the Supreme Court decisions in Smt. Tribeni Devi and Ors. v. Collector of Ranchi, (1972) 1 SCC 480 and Collector, Rajgarh v. Dr. Harisingh Thakur and Anr., AIR 1979 SC 472, which held that the potential value of the land should be taken into account in determining the market value. 2. The Court held that the claimant was entitled to solatium at the rate of 10% on the market value of the land, as the proviso to Sub-section (2) of Section 23 of the Act, which deprives the owner of a land acquired for the purpose of an improvement or development trust, of solatium, is invalid. The Court relied on the Supreme Court decisions in Nagpur Improvements Trust and Anr. v. Vithal Rao and Ors., (1973) 1 SCC 500 and Balammal and Ors. v. State of Madras and Ors., AIR 1968 SC 1425, which held that the deprivation of solatium for acquisition of land under the Madras City Improvement Trust Act was discriminatory and violated the equality clause of the Constitution.

Final Decision: The Court partly allowed the appeal and directed that the compensation shall be awarded to the appellant for the land acquired at the rate of Rs. 4,000/- per Bigha and that the appellant will also be entitled to get, solatium at 10 per centum on the market value of the land calculated at the rate of Rs. 4,000/- per Bigha. The other items awarded by the learned Civil Judge are, of course, confirmed as the State has not filed appeal qua those items. The appellant shall also be entitled to get interest at the rate of 4 per cent per annum on the total amount of compensation so awarded from the date of taking possession of land till the actual payment is made.