The
Executive Director Vs. Sarat Chandra Bisoi & ANR [2000] INSC 327 (11 May
2000)
S.R.Babu,
R.C.Lahoti R.C. Lahoti, J.
In the
early eighties large tracts of land were acquired in the State of Orissa by invoking the provisions of Land
Acquisition Act, 1894 for establishing an aluminium smelter plant and other
ancillary industries, civil township and supporting services. For the purpose
of assessing the compensation to be awarded to several land-owners whose land
was acquired an assessment report was called by the Land Acquisition Officer.
The land consists of two kinds : (i) Sarad-I Dofasali, and (ii) Taila. During
the course of hearing we were told by the learned counsel for the parties that
in the local language a fertile or cultivated land is called Sarad and Sarad-I Dofasali
land is one on which two crops can be taken. Taila is a barren land. The
assessment report appointed the value of cultivable land at Rs.12,500/- per
acre and of barren land at Rs.7,500/- per acre. On 27.5.1982 the Collector of
District Dhenkanal, where the land is situated, addressed a letter to the
Divisional Commissioner stating that the rates of land appointed by the
assessment report were on the lower side and he recommended that Rs.22,000/-
and Rs.12,500/- respectively per acre would be reasonable rates for fixing the
compensation. The Land Acquisition Officer made an award accepting the rates
suggested by the Collector. The dissatisfied landowners sought for a reference
to the Civil Court requesting for enhancement of the
quantum of compensation.
The
learned Sub-Judge after recording evidence arrived at a finding that a rate of
Rs.40,000/- per acre for Sarad land and a rate of Rs.30,000/- per acre for Taila
land would be reasonable rates at which the compensation should be awarded. A
perusal of the judgment of the trial court shows that so far as Sarad-I Dofasali
land is concerned there was no evidence adduced by either party of
contemporaneous transactions of land so as to determine the market rate
prevailing in the area and therefore the court applied the capitalisation
method of determination of value based on the net annual yield of the land. The
learned Trial Judge determined the annual net yield of the land at Rs.2,000/-
per acre and then by capitalising the same by applying a multiplier of 20,
determined the value of the land at Rs.40,000/- per acre. The finding as to the
value of Taila land was based on the inference drawn from evidence of
transactions of sale of land adduced by the parties.
The
High Court upheld the assessment of annual yield of Sarad land as found by the
trial court. However, the learned Single Judge was of the opinion that
multiplier of 20 as applied by the trial court was on the higher side and a
multiplier of 16 only should have been adopted.
Accrdingly
the value of Sarad land has been determined at Rs.32,000/- per acre. As to Taila
land the High Court formed an opinion that the rate of Rs.30,000/- per acre
determined by the trial court could not be applied uniformally to all the land
acquired. The High Court chose to adopt belting system by categorising the Taila
land into three categories, namely, (i) land near the national highway, (ii)
land by the side of the gram panchayat road, and (iii) other such lands which
are not road-side lands and appointed the value thereof respectively at
Rs.35,000/-, Rs.30,000/- and Rs.25,000/- per acre. Having so determined the
rate of the land the High Court found that several pieces of land belonging to
different landowners needed to be categorised and as satisfactory evidence in
that regard was not available on the record, remanded the case to the trial
court for holding further enquiry so as to determine into which out of the
three categories of Taila land the acquired pieces of land fell.
Feeling
aggrieved by the judgment of the High Court, the National Aluminium Co. Ltd.,
for the benefit of which the land acquisition has taken place, have come up in
appeal.
We
have heard the learned counsel for the parties.
Ordinarily,
the most accepted and recognised method of appointing compensation for land
acquisition is to find out the value of the land prevailing on the date of
notification under Section 4 of the Land Acquisition Act which can best be
enabled by tendering in evidence documentary evidence showing the price at
which similar pieces of land have been bought and sold on and around the date
of notification.
Where
there are no sales of comparable land the value has to be found out in some
other way. One of the methods is to find out the annual income of the land
which the owner has been deriving or is expected to derive from the use of the
land and capitalise the same by adopting a multiplier. In AIR 1983 SC 1190 this
Court has said : The capitalised value of a property is the amount of money
whose annual interest at the highest prevailing interest at any given time will
be its net annual income. The net annual income from a land is arrived at by
deducting from the gross annual income all outgoings such as expenditure on
cultivation, land revenue etc. The net return from landed property, generally
speaking, reflects the prevalent rate of interest on safe money investments.
It was
a case of very large tract of agricultural land having been acquired for Beas project. This Court held that in the facts and
circumstances of that case 15 years purchase would be proper for determining
the compensation and not 20 years purchase. Our attention has been invited to a
Division Bench decision of the High Court of Orissa in Ors. - AIR 1991 Orissa
271 wherein on a conspectus of decided cases, the Division Bench has held that
16 years purchase was ideal to be adopted for fixing the market value of the
land in Orissa. The High Court has adopted the same multiplier for this case.
We do not find any fault therewith, in the facts and circumstances of the case
and approve the same.
As to Taila
land no fault can be found with the belting system adopted by the High Court so
as to make a distinction between three categories of land which would obviously
be having different market values. The submission of Shri Altaf Ahmad, the
learned Additional Solicitor General is that the appellants were seriously
aggrieved by the finding arrived at by the trial court and substantially
accepted by the High Court in the matter of appointing the sale price of the
land. The learned Additional Solicitor General has carried this Court through
the evidence adduced by the parties and available on the record of the trial
court. We agree with the learned ASG that the evidence adduced by the claimants
and the finding arrived at by the trial court suffer from a few infirmities.
Firstly, the pieces of land forming subject- matter of acquisition are large
pieces of land while the evidence adduced by the landowners consist of
transactions relating to small pieces of land or plots. The value of small
pieces of land is always on the higher side and large pieces of land may not
fetch the price at the same rate. Secondly, very skeleton evidence has been
adduced by the landowners. In some of the cases there are just one or two
transactions placed on record. Thirdly, satisfactory evidence has not been
adduced by showing the locations of the land forming subject- matter of
transactions tendered in evidence so as to enable a finding being
satisfactorily recorded that the transactions were of land comparable with the
one under acquisition. In our opinion, in the facts and circumstances of the
case it would suffice if the figures of the value arrived at by the High Court
were discounted by 25% approximately. In other words, the rate at which the compensation
should be calculated in respect of Taila land should be at the rate of
Rs.27,000/-, Rs.22,500/- and Rs.18,000/- respectively in place of Rs.35,000/-,
Rs.30,000/- and Rs.25,000/- per acre as appointed by the High Court. We make it
clear that we have followed the abovesaid approach not so much by way of any
principle but more by way of finding out a reasonable solution so as to give a
quietus to this litigation. The lands were acquired in early eighties and by
this time a period of about 20 years has elapsed. We are convinced of the need
of avoiding a remand to record further evidence in this regard except to the
extent considered unavoidable by the High Court. We are told that there are
still a large number of cases pending and awaiting finalisation of land
acquisition compensation and they all need to be disposed of expeditiously.
Directions
made by trial court in the matter of payment of solatium and interest were
neither challenged before nor disturbed by the High Court. They would bind the
parties.
The
appeals are disposed of accordingly. No order as to the costs.
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