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1990 Supreme(SC) 781

SUPREME COURT OF INDIA
KULDIP SINGH AND N.M. KASLIWAL, JJ.
Shree Vijay Cotton and Oil Mills Ltd., Appellant
Versus
State of Gujarat, Respondent.
Civil Appeal No.3(N) of 1972
Decided on 6-12-1990.

Advocates:
A.K.VERMA, HARISH N.SLAVE, M.N.SHROFF, R.N.SACH, S.SUKUMARAN

Headnote:

Land Acquisition Act, 1894 – Sections 4 6(1), 23, 28 and 34 - Acquisition and Requisition of land – Land Acquired for public purpose - Possession - Compensation – Market value - Powers of appellate Court - Government issued a notification under S. 6(1) of Act, 1894 declaring that the land was needed for public purpose - Collector awarded compensation - Feeling dissatisfied , the claimant asked the Collector to make a reference to the Court under S. 18 of the Act which was done. The learned District Judge found that the claimant was entitled to compensation on the basis of the market value of the land on the date of notification under S. 6 of the Act - Held, Legislative mandate is clear. It is a directive to the Collector to pay the interest in a given circumstance. Section 34 nowhere says that the interest amount is to be included in the award decree as prepared under Section 23(1) read with Section 26 of the Act. Similarly Section 28 provides "the award of the Court may direct that the Collector shall pay interest". Here also the award under Section 23(1) read with Section 26 has been kept distinct from the payment of interest under the section. The interest to be paid under Section 34 and also under Section 28 is of different character than the compensation amount under Section 23(1) of the Act. Whereas the interest, if payable under the Act, can be claimed at any stage of the proceedings under the Act, the amount of compensation under Section 23(1) which is an Award-Decree under Section 26, subject to the rules of procedure and limitation - We do not, therefore, agree with the reasoning and the findings reached by the High Court. We are of the opinion that it was not necessary for the appellant-claimant to have filed separate appeals, cross-objections before the High Court for the purposes of claiming, interest under Section 28 or Section 34 Of the Act. He could claim the interest in - filed cross-the State-appeal - Appeal allowed.

JUDGMENT

KULDIP SINGH, J.:—The Vijay Cotton & Oil Mills Ltd. was the owner of 6 acres 38/1/2 Gunthas of land situated on the Bhachau-Rahapar Road in Kutch District. On November 19, 1949 the Government of Kutch took possession of the said land under an arrangement that the Government would give to the owner in exchange suitable land of equal value. The Government constructed on the land, a State Guest House and a Court House. Thereafter the Government did not give any other land in exchange and instead decided to acquire the same. On February, 1 1955 the Government issued a notification under S. 6(1) of the Land Acquisition Act, 1894 (hereinafter called the Act) declaring that the land was needed for public purpose. The Collector awarded Rs. 5,075.44 rip as compensation. Feeling dissatisfied , the claimant asked the Collector to make a reference to the Court under S. 18 of the Act which was done. The learned District Judge found that the claimant was entitled to compensation on the basis of the market value of the land on the date of notification under S. 6 of the Act. He determined the same at the rate of Rs. 3 / - per square yard. He also awarded solatium at the rate of 15% and interest at 6% from February 1, 1955. The State preferred an appeal against the award of the District Judge before the High Court.

2. The High Court came to the conclusion that the compensation under the Act could only be determined on the basis of the market value of the land on the date of the notification under S. 4(1) of the Act and since no such notification was issued it was not possible to determine the amount of compensation payable under the Act. The claimant, after obtaining a certificate from the High Court, filed civil appeal in this Court. Taking into consideration the scheme of the Act this Court held that the notification dated February 1, 1955 issued under S. 6 of the Act could be treated as a composite notification under S. 4(1) and S. 6(1) of the Act and the District Judge could lawfully award the market value of the land on that day. The matter was, thus, remanded to the High Court for disposal on merit.

3. There were two questions for consideration before the High Court. Whether the compensation awarded by the learned District Judge at the rate of Rs.3/- persquare yard was wrong and if so to what extent. The second question was raised by the claimant wherein he claimed interest on the compensation amount from November 19, 1949 instead of February 1, 1955 as awarded by the District Judge. He contended that under Ss. 34 and 28 of the Act he was entitled to interest from the date the possession of the land was taken over from him.

4. The High Court accepted the State appeal and reduced the price of acquired land from Rs.3/- per square yard to Rs. 1.35 per square yard. The High Court rejected the claim ofthe claimant to interest from November 19, 1949 instead of February 1, 1955. This appeal by the claimant via special leave petition is against the judgment of the High Court.

5. We may take-up the first question While determining the value of the land the learned District Judge relied upon his inspection-note Exhibit 39 and two instances of sale Exhibit 12 and Exhibit 13. The High Court ruled out the inspection-note from consideration on the ground that the same was based on extraneous material and was not an evidence on the record of the case. So far as the instances Exhibits 12 and 13 are concerned, the High Court came to the conclusion that these were comparable instances both in point of time and quality but keeping in view the smallness of the size of the plots, comprising these instances, as compared to the acquired the High Court fixed the price of the acquired land at 40% of the average price of the plots. Since the District Judge found Rs. 3/- per square yard as price of the acquired land, the High Court reduced the same by 60% and allowed the price at Rs. 1.35 per square yard.

6. According to the High Court while fixing the price































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