Modi & Ors. Vs. State of Orissa & ANR.  INSC 618 (11 August 2010)
IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 940
OF 2004 Chaturbhuja Modi & Ors. ... Appellants Versus State of Orissa &
Anr. ... Respondents
Mukundakam Sharma, J.
This appeal is directed against the judgment and order dated
12.09.2002 passed by the High Court of Orissa at Cuttack.
appellant and the State filed three appeals before the High Court against the judgment
and order dated 16.04.1998 passed by the learned Civil Judge (Senior Division),
First Court, Cuttack in L.A. Case No. 3 of 1995. The said appeal arose out of a
land acquisition proceeding pertaining to the land of the appellants -
A notification under Section 4(1) of the Land Acquisition Act was
published on 09.12.1982, proposing to acquire land of the appellants measuring
2.429 acres covered under Khata No. 581 of Mouza - Bahar Bisinabar for
construction of additional building, office, garage and staff quarters of
Orissa State 2 Financial Corporation, Cuttack. The Land Acquisition Officer
assessed the market value of the land at the rate of Rs. 75,000/- per acre. The
appellants - claimants sought for a reference to the learned Civil Judge as
envisaged under Section 18 of the Land Acquisition Act, and the Ld. Judge after
receiving evidence adduced by the parties, enhanced the compensation to Rs.
1,50,000/- per acre. The appellants - claimants being dissatisfied with the
aforesaid determination of compensation, filed an appeal before the High Court,
claiming a higher compensation at the rate of Rs. 12, 50,000/- per acre. After
appreciation of the evidence available on record and relying primarily on the
sale consideration in Exhibit 1, dated 06.10.1982, the High Court enhanced the
compensation for the acquired land to Rs. 3,00,000/- per acre and also held
that the appellants should be entitled to other statutory benefits as available
under the Act.
The appellants, still aggrieved, filed the present special leave
petition in this Court in which leave was granted after which the appeal is
listed for hearing. We took up the appeal for hearing during the course of
which we heard learned counsel appearing for the parties who have painstakingly
taken us through the evidence on record in support of their contentions.
This appeal is filed to prove and establish that the 3 acquired
land is situated in the heart of the Cuttack City and close to the National
Highway No. 5. The land was acquired for construction of additional building of
O.S.F.C. for accommodation of office etc. At the time of acquisition, other
commercial establishments like a cinema hall, hotel, etc. had already come up
near about the acquired land. The learned Civil Judge as well the High Court
found that the acquired land is not on the side of National Highway No. 5 but
the same is not very far away from the said Highway. It is also on record that
the acquired land is a low-lying land and remains water- logged round the year.
But the said fact could not belie the fact that the acquired land had great
potential value. In order to assist the Courts to properly assess and determine
the fair and reasonable market value, the parties adduced evidence, both oral
In this appeal, the parties have adduced limited evidence to
establish their case. The records indicate that the appellants had filed two
certified copies of the registered sale deeds, namely Exhibits 1 and 2, which
were of course exhibited without objection from the respondent. Sale deeds were
produced on behalf of the respondent - State and Land Acquisition Officer also,
and they were exhibited as Exhibit B to B/3 but the same were marked as such
1, which was produced by the appellants herein, is a certified copy of the
registered sale deed dated 04.10.1982.
aforesaid sale deed, a total land of Acre 0.0070 4 decimals in Baharbisinabar
was sold for Rs. 40,000/- i.e. at the rate of 22,500/- per gunth or Rs. 5,50,000/-
(approximately) per acre.
The other sale deed relied upon by the appellants - claimants is
Exhibit 2, which is a certified copy of registered sale deed dated 17.04.1982
by which land measuring Ac. 0.003 decimals was sold for Rs. 2,700/-. Exhibit 2
shows that a very small piece of land measuring only Ac. 0.003 decimals was
sold at the rate of Rs. 9, 00,000/- per acre indicating its highly inflated
value, which is established even when compared with Exhibit 1. Sale of such a
tiny piece of land must have been for some specific object. The land which is
acquired in the present case is a large tract of land, measuring Ac. 2.429
decimals and therefore, Exhibit 2 cannot be put up as a safe guide and basis
for determining the market value of the present acquired land.
Court has therefore rightly kept said sale deed out of its consideration. It
has also come in evidence, which is referred to and relied upon by the Civil
Judge, that the purchaser of Exhibit 2 had his own land adjoining to the south
of the land covered under it. Therefore, it appears that the purchaser was in
dire necessity for purchasing the said land for the convenience of his own
adjoining land. That being the position, the purchaser of the land in Exhibit 2
was even prepared to purchase the same at a higher value. Figures represented
in sale deeds may not always be seen by Courts as a parameter of existing fair
values. In that view of this aspect, 5 the assessed value of the acquired land
is not comparable to the land mentioned in Exhibit 2.
In so far as the evidentiary value of Exhibit 1 is concerned, the
same is found to be proximate to the date of notification under Section 4(1)
but under the said notification, another small piece of land measuring Ac.
0.070 decimals of land was also sold for Rs. 5,50,000/- per acre.
document, however, did not indicate whether the said land is in proximity to
the acquired land or if the same is comparable to the land in question. By the
aforesaid sale deed, only a small piece of land was sold whereas the acquired
land is a large tract of land.
Other sale deeds which were produced on behalf of the Land
Acquisition Officer, namely Exhibits B to B/3, were placed on record under
objection. There is no evidence by the Collector indicating that the lands
covered by the aforesaid sale deed transaction are in any manner comparable
land with that of the land under acquisition. The land under the said sale
deeds are located in some other village whereas the acquired land is
"Puratan Partita" in Kisan, but the land sold vide Exhibit B series
are Bari in Kisan. Therefore, the said sale deeds also cannot be made as the
basis for determining fair and reasonable market price of the land acquired.
The only evidence that could be considered and relied upon is
Exhibit 1. The following criteria provide a good indication of whether a sale
deed may be comparable to the one in question: (1) it must be within a
reasonable time of date of notification under Section 4(1) of the Act; (2) it
should be a bonafide transaction; (3) it should be a sale of the land acquired
or of the land adjacent to the one acquired; and (4) it should possess similar
advantage. Although the land whose sale is evidenced in Exhibit 1 is not an
excellent comparison in terms of area, the same indicates a sales transaction
completed at around the same time as the acquisition of the said land.
Moreover, Exhibit 1 also concerns a plot that is in geographical proximity to
the acquired land. There being no other evidence on record, and since we are
not inclined to remand the matter after such a long delay, we would rely on
Exhibit 1 with necessary scrutiny and caution. Reliance could be placed on the
said documentary evidence for determining and assessing the compensation of the
acquired land after giving the necessary deduction.
The High Court appears to have taken notice of the aforementioned
criteria and has given some discount in compensation as the land under Exhibit
1 is a very small piece of land and the land acquired in the case in hand is
much larger in size. After giving the said discount, the High Court computed
the compensation at the rate of Rs. 3,00,000/- per acre for the acquired land.
While determining compensation, 7 some conjecture is unavoidable as it is
generally not possible to have any documentary evidence of sale of land of
similar nature and in the near vicinity of the acquired land. The value shown
in Exhibit 1 cannot be assessed as the value of the acquired land for the
reason that the said land which is sold under Exhibit 1 is a very small piece
of land, whereas the acquired land being a large tract of land. This Court has
held in Administrator General of West Bengal v. Collector, Varanasi, reported
at (1988) 2 SCC 150, that where large tracts of land are required to be valued,
valuation in transactions with regard to small plots is not to be taken as the
real basis for determining the compensation of large tracts of land. It follows
that where the market-value of large block of land is determined on the basis
of sale transactions for smaller property, appropriate deduction has to be made
for making allowance for the loss of the acquired land required to be used for
internal development such as construction of roads, drains, sewers, open spaces
and the expenditure involved in providing other amenities like water,
electricity etc. The extent of area required to be set apart has to be assessed
by the Court having regard to the shape, size and situation of the concerned
block of land.
After giving some variations and discount, the High Court fixed
the rate of the land at Rs. 3, 00,000/- per acre, which in our considered
opinion and in the light of evidence on record, seems to be just and proper.
Consequently, we dismiss 8 this appeal as we find no merit in it but without
..........................................J. [Dr. Mukundakam
..................................J. [Anil R. Dave]
August 11, 2010.