IMPORTANT POINT
In deciding amount of compensation for tre cutting for laying down electrical transmission lines, each case should be decided considering all relevant factors and fact situations obtaining therein.

Headnote:Indian Telegraph Act, 1885 – Section 10, Part III – Compensation – The sites of the land, the distance between the high voltage electricity line laid there over, the extent of the line thereon as also the fact as to whether the high voltage line passes over a small track of land or through the middle of the land and other similar relevant factors like value of the land would be determinative – Each case should be decided considering all relevant factors and fact situations obtaining therein – High Court judgments being not sustainable, set aside. (Para 10 and 13).
       2007 AIR SCW 1145; 1995 Supp. (2) SCC 635; 1995 Supp. (2) SCC 637; (2002) 3 SCC 527 – Referred.
       Facts of the case :
       Question of amount of compensation for the trees cut and removed by the Kerala State Electricity Board is raised in these appeals.
       Findings of the Court :
       Each case should be decided considering all relevant factors and fact situations obtaining therein.

JUDGMENT

S.B. SINHA, J.—

1.Leave granted in SLPs.

2.These appeals involving common questions of law and fact were taken up for hearing together and are being disposed of by this common judgment. What would be the amount of compensation for the trees cut and removed by the Kerala State Electricity Board, a body corporate, constituted and incorporated under Electricity (Supply) Act, 1948 is the question involved in these appeals. Indisputably, amount of compensation for the said purpose is determined in terms of the provisions of Section 10, Part III of the Indian Telegraph Act, 1885.

3.Before we embark upon the said question, we may notice the amount of compensation that has been determined by the Appellant-Board as also by the Reference Court being the District Judge.

4.Trees have been cut and removed for drawal of 110 K.V. Electric Line. The Board/Land Acquisition Officer determined the amount of compensation whereupon reference was made. The learned District Judge while determining the amount of compensation followed a judgment of 5 Judge Bench of the Kearla High Court in Kumba Amma v. K.S.E.B. [2000 (1) KLT 542], holding that annuity thereof shall be calculated on the basis of 5% return. Revision applications having been filed thereagainst. The High Court in some cases, as noticed hereinbefore, enhanced the amount of compensation, fixing the rate of diminution at 50% instead of 40%.

5.It is not in dispute that the High Court of Kerala at different point of time took different views in the matter. To begin with, in Kerala Electricity Board v. Thomas [1961 KLT 238], it was held that the principle which should be resorted to for the said purpose is annuity method. Fair return of 5% interest per annum was held to be reasonable for calculating the amount of compensation. Allegedly, the Board was following the principle laid down in the said judgment in determining the amount of compensation.

6.The question again came up for consideration before the High Court in K.S.E. Board v. Marthoma Rubber Co. Ltd. reported in 1981 KLT 646, wherein a Full Bench of the said Court opined that it would be safe to adopt the means of return on a fixed deposit for the usual period of 5 years or 63 months whichever is held reasonable and anticipated return for long term basis. The usual bank rate of interest at the relevant point of time was 10% for long term deposits, i.e., over 5 years. The said rate of interest was adopted by the Board to be a fair return and the amount of annuity was being calculated on the said basis. However, in Kumba Amma (supra), a 5 Judge Bench of the High Court opined that inflation was a relevant factor which should be taken into consideration while computing the amount of compensation for destruction of trees.

7.We may, however, notice that in one of the impugned judgments, a learned Single Judge of the High Court held :-

“The court below has fixed the land value at Rs.20,000/- per cent and the rate of diminution at 40%. Taking Exhibits A1 and A2 produced, the lower court is correct in fixing the land value at Rs.20,000/- per cent cannot be the reasonable land value in this case. Hence I fix the land value in this case at Rs.30,000/- per cent. So also the rate of diminution in land value is fixed at 50% instead of 40% fixed by the court below. The order passed by the court below is modified accordingly.”

No reason has been assigned in support of the above view. The materials placed on record were not analysed. Why such a view was taken also does not appear from the records of the case. The amount of compensation is required to be determined keeping in view the purpose and object of the statute. There cannot be any fixed formula therefor or the other. Although, undoubtedly one formula laid down, may assist the Board and/or Reference Court to apply the same but there cannot be hard and fast rule in this behalf. A fixed formula for determining the amount of compensation although may make the task of the Land Acquisition Office

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2007 Supreme(SC) 808

IMPORTANT POINTIn deciding amount of compensation for tre cutting for laying down electrical transmission lines, each case should be decided considering all relevant factors and fact situations obtaining therein.

Cases Referred (4)

IMPORTANT POINT
In deciding amount of compensation for tre cutting for laying down electrical transmission lines, each case should be decided considering all relevant factors and fact situations obtaining therein.