K.A.A.
Raja Vs. State of Kerala [1994] INSC 261 (26 April 1994)
Ramaswamy,
K. Ramaswamy, K. Venkatachala N. (J)
CITATION:
1994 SCC (5) 138 1994 SCALE (2)1059
ACT:
HEAD NOTE:
ORDER
1.This
appeal by special leave arises from the judgment of the Division Bench of the Kerala
High Court dated 21-1-1991 in LAA No. 226 of 1990 and
cross-objections. The appellants are the claimants. The Government of Kerala
proposed to acquire 52.88 acres of cardamom plantation situated in Mappara
Village in Peermade Taluk of Idukki District of Kerala State by a notification
issued under Section 3(1) of the Kerala Land Acquisition Act, 1961, Act 21 of
1962, for short 'the Act' and published in the State Gazette on 10-1-1984, for Periyar
Tiger reserved forest. Possession was taken on 7-5-1984 and the same was handed over to the Forest Department on 8-6-1984. The Land Acquisition Officer by his award dated 10-10-1985 determined the market value of the said land in a
sum of Rs 14,75,385.25. On reference under Section 18 of the Act, the Land
Acquisition Court 140 (Subordinate Judge) enhanced the market value of the said
land by his judgment and decree dated 22-2-1990 to Rs 1,97,77,772.60. On
consideration of the appeal by the State and also the cross- objections filed
therein, the High Court while allowed the appeal of the State, dismissed the
cross-objections. It determined the market value of the said land at Rs 23,73,967.74.
Dissatisfied therewith, the appellants have filed this appeal seeking enhanced
market value of the lands acquired.
2.The
contention of the learned counsel for the appellants was that the High Court
had committed grievous error in accepting Exs. B-4 and B-5(a) in fixing the
average of the yield at 100 kgs per hectare and also the price per kilogram at Rs
220. The learned counsel has taken us through the evidence and the findings
recorded by the Land
Acquisition Court
(Subordinate Judge) as well as the High Court. As seen from its judgment, the
High Court has committed gross mistakes in computing the income from the
estates acquired. Ex. B-4 is a statement made by the Reserved Forest Officials
on 16-6-1984 to the effect that the plantation
was not properly maintained and that on the date of taking over, there was
considerable damage to the crop. There is no reason to dispute the same. Ex.
B-5(a) is the certified copy of the record relating to assessment of the
agricultural income secured by the Land Acquisition Officer. It was marked in
the civil court by consent of the parties and the Government has relied upon it.
We find there from that for the years 1980-81, 1981-82 and 1982-83, the
appellants have submitted nil income returns for the assessments of the income
derived from the lands but the Agricultural Income Tax Officer had assessed the
income by best of judgment. Therein the Agricultural Income Tax Officer had
relied upon the statement made by the eight sets of claimants in the
assessments. They concluded that total land was 52.88 acres and the yield for
the year 1982-83 was 3079.5 kg. which we have rounded at 3080 kg. Though the
learned counsel sought to rely upon the auction sales held in the year 1983 at
the relevant time for Rs 4459 of 6.3 kg and Ex. B- 13 Rs 472.81 for auction
held on 13-12-1983 and Rs 483.22 for the auction held on 6-12- 1983 and the
average was worked out by the civil court at Rs 471.87 per kg. The High Court
has rightly rejected the working out the average at the aforesaid rate for
valid reasons. It had determined at the rate of Rs 220 per kg. as the
reasonable prevailing price taking into account the prevailing price for three
years prior to the year 1982-83 and worked it out at the average and determined
the price at Rs 220 per kg. The method adopted by the High Court is fair and
just, and that it meets the exigencies of the situation. The High Court also
found that there were 8 hectares of the plantation where five years old plants
were found, in 7 hectares of the plantation where six years old plants were
found and 6.14 hectares plantation where 9 years old plants were found. It was agreed
that maximum period which the plants would yield cardamom would be 15 years. On
that basis the learned Judges worked out the capitalised value at 10 years, 9
years and 6 years yields respectively and determined the market value evolving
multipliers for those years. It worked out to average yield at 100 kgs. per
hectare. This principle adopted was not correct since actual yield as assessed
by the Asstt.
Income
Tax 141 Department for the purpose of income tax was there and it had attained
finality. The State produced and relied upon this assessment order as evidence.
It is clear that the income assessed by the Agricultural Income Tax Officer, as
having been derived by the appellants from the lands in question during the
relevant years, was accepted by appellants and suffered the tax.
For
the relevant year 1982-83, the Income Tax Officer estimated the total yield of
cardamom as 3080 kgs. If it is multiplied by Rs 220 per kg Rs 6,77,600 would be
estimated gross income derived by the appellants. High Court also found that
the expenditure incurred by the appellants was Rs 3036 per acre which worked
out to be for 53 acres at Rs 1,60,590.00 (sic). Thus after deducting the
expenditure from the gross income the net income would be Rs 5,17,000. The
question then is what would be the appropriate multiplier that would be applied
in a case like this.
3.That
long delay would occur from the date of the proposal to acquire a particular
land for a public purpose till final decision in that behalf is taken and a
notification under Section 4(1) of the Land Acquisition Act is issued and
published in the Gazette. In the meanwhile it would become a matter of common knowledge,
in particular, the owners will come to know that their lands will be proposed
for acquisition. Instances are not uncommon where attempts will be made to
boost up the value of the acquired lands. Sometimes fruit-bearing trees are
planted and reports are obtained of the existence of the trees with reference
to their specific ages. This case itself establishes from the record that, but
for the report of the Forest Officer, the report given by the Subordinate
Officers of the Revenue Department would have persuaded the courts to accept
the report of the Revenue Officers that the plantation maintained was of high
standards and in good condition which was belled by the report of the Forest
Officials, as accepted by the High Court. Therefore, it would be necessary in
every case to place a correct report before the reference court, the true state
of affairs regarding the number of trees, their ages, their yield, in
particular where capitalisation method is to be adopted to determine the market
value of the acquired land. In Joginder Singh Saini v. State of Haryana' this Court held that the mother
trees are to be valued as wood and the nursery plants are not to be separately
valued, but with a direction to be taken away by the owner. In Periyar and Pareekanni
Rubbers Ltd. v. State of Kerala2 this Court held that it is the duty of the
court to determine just and fair market value and the conduct of the Land
Acquisition Court or Officer in that behalf, if found to be a misconduct, the
officer was amenable to disciplinary proceedings for misconduct. That apart the
claimants should produce necessary evidence on the value of land since the
burden of proof is on them to establish the higher compensation claimed.
Equally the officer-in-charge has responsibility and duty to place all material
and relevant evidence in rebuttal of the enhanced claim. As a part thereof the
condition of the trees, the ages of the trees, their number and the total yield
derived from the trees being material and relevant 1 (1990) 3 SCC 276: AIR 1990
SC 1219 2 (1991) 4 SCC 195 : AIR 1990 SC 2192: 1990 Supp 1 SCR 362 142 facts to
adjudge not only the value of the produce, but also to apply suitable
multiplier to determine the market value as compensation. The court equally has
duty, on an overall consideration of the facts and circumstances available in
the particular case on hand, while determining the number of trees, their ages,
the yield and the price fetched or likely to fetch in the open market should
apply appropriate multiplier in determining the market value of the grove or
plantation etc. In any case for want of appropriate evidence as to multiplier
adduced by either party, we take seven years' multiplier for purpose of capitalisation
of net income, though income may vary depending on evidence.
4.We
have seen from the evidence the nature of the trees and their yield accepted by
the Income Tax Authorities and the price fixed by the High Court. On an overall
consideration of the prevailing prices though for one year there may be higher
prices, but on an average it was found that the price would be at Rs 220 per
kg. To apply the capitalisation method, on the facts and circumstances, we
consider that in assessing the market value of the plantation of a large extent
of the lands acquired in the notification, the suitable and proper multiplier
could be taken as 7 years.
5.Therefore,
applying the 7 years' multiplier with reference to the year of acquisition for
the purpose of capitalising the net income, we consider that the just and
proper market value would be round figure of 36 lakhs. The appellants,
therefore, would be entitled to the market value in a sum of Rs 36 lakhs for
the total extent of 52 acres 88 cents. Therefore, the appellants are entitled
to the market value of Rupees Thirty-six lakhs for their lands with everything
thereon and usual benefits of 30% solatium on the enhanced market value and
interest at 9% for the first year from the date of taking possession and 15%
interest from the date of expiry of one year till date of making payment of
compensation. The entitlement with regard to the payment of the interest under
Section 23(1-A) would depend upon the decisions to be rendered by the
Constitution Bench in K.S. Paripoornan case and the authority depending upon
the judgment would work out that benefit also.
6.The
appeal is allowed to the above extent. But in the circumstances, the parties are
directed to bear their own costs.
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