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2025 Supreme(HP) 1652

IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
SUSHIL KUKREJA, J.
Union of India  -  Appellant
Versus
Mool Chand & others.  - Respondent
RFA No. 243 of 2016
Decided On :  22-11-2025


Advocates Appeared:
For the Appellants :Mr. Balram Sharma, Deputy Solicitor General of India, with Mr. Rajeev Sharma, Advocate.
For the Respondent:Mr. Bimal Gupta, Senior Advocate, with Ms. Kusum Chaudhary, Advocate. Mr. Manoj Chauhan, Additional Advocate General.

Market value in land acquisition fixed using highest bona fide comparable sale exemplar, with time escalation (10%) and size deductions (20%), considering land potentiality near development areas.

Headnote:(A) Land Acquisition Act, 1894 - Sections 4, 18, 23, 54 - Compensation - Market value determined as price a willing purchaser would pay willing seller, considering existing advantages, potentialities excluding scheme benefits - Highest bona fide exemplar of similar land preferred over average - 10% annual escalation applied for 1.5-year gap between exemplar and notification - 20% deduction for small plot size - Reference Court enhanced compensation to Rs.30,36,000/- per bigha upheld. (Paras 8-22)

(B) Comparable sales - Conditions: within reasonable time of notification, bona fide, adjacent land with similar advantages - Potentiality includes proximity to development areas, amenities - Small plot sales usable for large tracts with deductions for development costs. (Paras 12, 21)

Facts of the case:
Land measuring 1-11-0 bighas acquired for training center - Land Acquisition Collector awarded Rs.33,154/- per biswa with 12% additional, 30% solatium - Claimant sought enhancement before Reference Court claiming adjacency to highway in business center - Reference Court used highest exemplar (Rs.1,65,000/- per biswa), added 10% escalation to Rs.1,89,750/- per biswa, deducted 20% to Rs.1,51,800/- per biswa (Rs.30,36,000/- per bigha) - Appeal challenging excessive award.

Findings of Court:
No error in Reference Court's methodology - Highest exemplar valid, adjustments reasonable given location potential.

Issues: Whether Reference Court erred in relying on highest exemplar distant by 1.5 years, applying 10% escalation, 20% deduction despite small plot and alleged inferior location.

Ratio Decidendi: Highest bona fide exemplar governs where multiple available; escalation for prior sales permissible at reasonable rate considering location; small plot sales applicable to larger tracts post-deductions; no interference absent perversity.

Result: Appeal dismissed.

Table of Content
1. land acquisition notified for ssb center adjacent nh-21. (Para 1 , 2 , 3 , 4)
2. enhanced compensation upheld; appeal dismissed. (Para 5 , 23 , 24 , 25)
3. appellant contests excessive award; respondent upholds location value. (Para 6 , 7)
4. market value: willing seller-buyer price with potentiality. (Para 8 , 9 , 10 , 11)
5. comparable bona fide sales near acquisition time used. (Para 12 , 13 , 15)
6. highest bona fide exemplar sets compensation value. (Para 16 , 17)
7. 10% annual escalation for 1.5-year gap applied. (Para 18 , 19 , 20)
8. 20% deduction for small-plot sales on large tract. (Para 21 , 22)

Judgment :

Sushil Kukreja, J.

The instant appeal has been preferred by the appellant-Union of India (hereinafter referred to as “the appellant”) under Section 54 of the LAND ACQUISITION ACT , 1894 (for short “the Act”) against award dated 22.08.2015, passed by learned District Judge, Kullu, District Kullu, H.P. (hereinafter referred to as “the learned Reference Court”), whereby the learned Reference Court enhanced the compensation.

2. The brief facts of the case are that Government of Himachal Pradesh issued Notification, dated 04.01.2011, under Section 4 of the Act and consequent thereto acquired land, measuring 1-11-0 bighas situated in Phati Shamshi, Kothi Khokhan, Tehsil and District Kullu, H.P., of respondent No. 1-Shri Mool Chand (claimant), who was petitioner before the learned Reference Court, for construction of Training Center, Sashastra Seema Bal (SSB), Shamshi. The publication of the notification under Section 4 of the Act was made in daily news paper Divya Himachal on 25.01.2011, in The Tribune on 03.02.2011 and Mushtri Munadi was done through Revenue Field Agency, vide rapat No. 229, dated 17.01.2011. Subsequently, the Land Acquisition Collector had assessed the market value of the land at Rs.33,154/- per biswa and awarded additional 12% compensation from the date of notification under Section 4 of the Act, till the date of award and solatium @ 30% on value of land, as per award, dated 18.06.2011.

3. The petitioner/claimant, feeling aggrieved with the award of the Land Acquisition Collector preferred a petition under Section 18 of the Act before the learned Reference Court for enhancement of the compensation mainly on the ground that the Land Acquisition Collector did not consider that the land was situated just adjacent to National Highway-21 at Shamshi, which is the business center of Kullu.

4. The learned Reference Court, allowed the petition of the petitioner/claimant and held him entitled for enhanced compensation at the rate of Rs.30,36,000/- (rupees thirty lac thirty six thousand) per bigha. In addition to the above, the petitioner was also held entitled to solatium, additional compensation etc.. Hence, the appellant-Union of India preferred the instant appeal under Section 54 of the Act with a prayer to quash and set-aside the impugned award dated 22.08.2015, passed by the learned Reference Court.

5. I have heard the learned Deputy Solicitor General of India for the appellant, learned Senior Advocate for respondent No. 1, learned Additional Advocate General for respondents No. 2 and 3 and also carefully examined the records.

6. Learned Deputy Solicitor General contended that the impugned award is based on conjectures and surmises and the findings so recorded by the learned Reference Court are not supported by the evidence on record. He further contended that the learned Reference Court had ignored the material evidence on record and granted excessive amount of compensation arbitrarily without any reason. He also contended that the acquired land was out of market and situated by the side of Beas river and the same had very less value and the learned Reference Court had granted the award excessively and arbitrarily without any sufficient reason. Lastly, he submitted that the appeal be allowed and impugned award dated 22.08.2015 passed by the learned Reference Court be quashed and set-aside

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