Singh & ANR. Vs. Union of India & ANR.  INSC 1367 (4 August 2009)
SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 7203 OF
2004 Attar Singh and another .... Appellants Versus Union of India and another
.... Respondents WITH
CIVIL APPEAL NOS. 7204 TO 7208 OF 2004
Appellants were owners of agricultural lands situated in village
Jharoda Kalan, New Delhi. The subject matter of these appeals is a Notification
dated 14th July, 1982 issued by the Union of India expressing its intention to
acquire the land in the said village
The Land Acquisition Collector made an award on 10th August, 1983
categorizing the acquired lands in three categories, i.e. `A', `B' and `C' and
fixed the market value thereof at the rate of Rs.5,800/- per; Rs.4,800/- per
bigha; and Rs.2,400/- per bigha respectively.
The awardees not being satisfied with the said award filed
applications for reference before the District Collector. References having
been made, the Reference Court vide its Award dated 22nd July, 1987 assessed
the fair market value of the acquired land at Rs.9,750/- per bigha.
Still not satisfied, the appellants preferred appeals before the
High Court seeking enhancement of compensation for acquisition of their lands
at the rate of Rs.27,750/- per bigha.
Before the High Court a contention was raised that in a Lok Adalat
Settlement, the market value of similarly situated land was fixed at
Rs.22,000/- per bigha at the instance of the Union of India, pursuant where to
a Division Bench passed a decree on the said basis.
A Division Bench of the High Court by its order dated February 28,
2003, however, on the basis of its earlier decision, assessed the fair market
value at Rs.11,500/- per bigha.
Learned counsel appearing on behalf of the appellants submitted
that in a matter of this nature, the High Court having regard to the claim of
the appellants, namely Rs.27,750/- per bigha should have awarded compensation
at least @ Rs.22,000/- which was fixed as the fair market price for lands
The principal question which, therefore, arises for consideration
is as to whether any agreement entered into by and between the holders of the
lands and the Union of India in a Lok Adalat should have formed the 3 basis for
determination of the amount of compensation in respect of the lands which are
said to be similarly situated.
It does not appear that before the High Court, the particulars of
the matter which was settled in the Lok Aalat had been produced. Before us only
an order sheet dated 5th November, 1992 passed in R.F.A. No.891 of 1987 has
been produced, which reads as under :- "Before the Lok Adalat, the parties
agreed that the market price of the acquired land is Rs.22,000/- per bigha. In
view of the settlement made before the Lok Adalat, we fix the market price of the
land at Rs.22,000/- per bigha.
appellant shall be entitled to increased compensation under Section 23(1A) of
the Land Acquisition Act, 1894 as amended by 1984 Act.
appellant shall also be entitled to solatium at 30% per annum and interest at the
rate of 9% per annum for the first year and at the rate of 15% per annum
thereafter till payment. The Supreme Court has already decided the matter
regarding the payment of interest and, therefore, the question of award of
interest need not await the decision of the Supreme Court as suggested by the
appeal is allowed with costs."
It is now a well settled principle of law that determination of
the market value of the land acquired indisputably would depend upon a large
number of factors including the nature and quality thereof. The norms which are
required to be applied for determination of the market value of the
agricultural land and homestead land are different. In given cases location of
land and in particular, closeness thereof from any road or high-way would play
an important role for determination of the market value wherefor belting system
may in appropriate cases may be resorted to. The position of the land,
particularly in rainy season, existence of any building etc. also plays an
important role. A host of other factors including development in and around the
acquired land and/or the potentiality of development will also have a bearing
on determination of the fair market value of the land.
Determination of the market value of the land may also depend upon
the facts and circumstances of each case, amongst them would be the amount of
consideration mentioned in a deed of sale executed in respect of similarly
situated land near about the date of issuance of Notification in terms of
Section 4(1) of the Act ; in absence of any such exemplars, the market value
can be determined on yield basis or in case of an orchard on the basis of
number of fruit bearing trees.
It is also well settled that for the purpose of determination of
price of acquired land, the courts would be well advised to consider the
positive and negative factors, as has been laid down by this Court in Viluben
Jhalejar Contractor vs. State of Gujarat [(2005) 4 SCC 789], i.e. : Positive
factors Negative factor (i) Smallness of size (i) Largeness of area (ii)
Proximity to a road (ii) Situation in the interior at a distance from the road
(iii) Frontage on a road (iii) Narrow strip of land with very small frontage
compared to depth (iv) Nearness to developed area (iv) Lower level requiring
the depressed portion to be filled up (v) Regular shape (v) Remoteness from
developed locality (vi) Level vis-`-vis land under (vi) Some special
disadvantageous acquisition factors which would deter a purchaser (vii) Special
value for an owner of an adjoining property to whom it may have some very
This Court in Union of India v. Pramod Gupta, [(2005) 12 SCC 1],
on the question of determination of market value opined :- "24. While
determining the amount of compensation payable in respect of the lands acquired
by the State, the market value therefor indisputably has to be ascertained.
There exist different modes therefor.
best method, as is well known, would be the amount which a willing purchaser
would pay to the owner of the land. In absence of any direct evidence, the
court, however, may take recourse to various other known methods.
admissible therefor inter alia would be judgments and awards passed in respect
of acquisitions of lands made in the same village and/or neighbouring villages.
Such a judgment and award, in the absence of any other evidence like the deed
of sale, report of the expert and other relevant evidence would have only
Therefore, the contention that as the Union of India was a party to the said
awards would not by itself be a ground to invoke the principles of res judicata
such awards it may be open to the Union of India to question the entitlement of
the respondent claimants to the amount of compensation and/or the statutory
limitations in respect thereof. It would also be open to it to raise other
contentions relying on or on the basis of other materials brought on record. It
was also open to the appellant to contend that the lands under acquisition are
not similar to the lands in respect whereof judgments have been delivered. The
area of the land, the nature thereof, advantages and disadvantages occurring
therein amongst others would be relevant factors for determining the actual
market value of the property although such judgments/awards, if duly brought on
record, as 7 stated hereinbefore, would be admissible in evidence."
furthermore opined :- "36. Yet again in Ras Behari Mandal v. Raja Jagadish
Chandra Deo Dhaubal Deb the Patna High Court reiterated the presumption that
the lessor retains all the rights in mines and quarries. It also noticed the
decision of the House of Lords in Great Western Rly. Co. v.
United China Clay Co. Ltd.wherein a grant reserving minerals was held to
exclude a deposit of china clay despite the fact that the same was found near
also held that:- "8. In V. Hanumantha Reddy v. Land Acquisition Officer
& Mandal R. Officer the law is stated in the following terms:
is now a well-established principle of law that the land abutting the national
highway will fetch far more higher price than the land lying interior."
Court furthermore opined :- "84. It is also trite to state that the market
value of agricultural land is lower than that of the land suitable for
commercial purposes. (See Om Prakash v. Union of India.) 8 It was observed :-
"87. The courts will also have to take into consideration the enormity of
the financial implication of enhancement in view of the size of the land
acquired for a particular project."
Singh v. Union of India, [(2005) 12 SCC 59], this Court held as under :-
"22. Concededly, the High Court in its impugned judgment did not place any
reliance whatsoever upon the sale instances whereupon strong reliance has been
placed by the parties solely on the ground that neither the vendors nor the
vendees thereof had been examined as witnesses. It has also not placed any
reliance upon any other judgment or award filed by the parties. The High Court
while arriving at the said finding evidently took into consideration the law as
it then stood. The correctness of the decisions wherein the aforementioned view
had been taken was doubted and the matter was referred to a larger Bench."
to Cement Corporation (supra), it was opined that the High Court was required
to consider the deeds of sale in their proper perspective for determining the
market value of the acquired land.
Karimbanakkal Sulaiman (Dead) by L.Rs. v. Special Tahsildar for K.A.K.P.I.P.,
[(2004) 13 SCC 643], this Court held:
"These factors have been taken into consideration by the High Court in
fixing the land value. Moreover, the land acquired was agricultural land and it
was acquired for the purpose of an irrigation project. There is nothing on
record to show that the land had any commercial value or future potentialities.
We do not think that the land value fixed is too low to be interfered with by
Viluben Jhalejar Contractor v. State of Gujarat, [(2005) 4 SCC 789], this Court
opined :- "24. The purpose for which acquisition is made is also a
relevant factor for determining the market value. In Basavva v. Spl. Land
Acquisition Officer deduction to the extent of 65% was made towards development
Kumar v. Union of India, [ (1996) 11 SCC 542 ], this Court held that even if
the entire land is of one village one standard for determining the market value
should not be applied, stating:- "....It has been firmly settled law by
beadroll of decisions of this Court that the Judge determining the compensation
under Section 23(1) should sit in the armchair of a willing prudent purchaser
in an open market and see whether he would offer the same amount proposed to be
fixed as market value as a willing and prudent buyer for the same or similar
land, i.e., land possessing all the advantageous features and to the same
should always be kept in view and 10 answered affirmatively, taking into
consideration all relevant facts and circumstances. If feats of imagination are
allowed to sway, he outsteps his domain of judicial decision and lands in
misconduct amenable to disciplinary law..."
On what basis the aforementioned settlement in the Lok Adalat was
arrived at is not known. Details of the land with regard to location, nature,
advantages and dis-advantages pertaining thereto are absent. In absence of any
detailed particulars showing the similarity of the land and/or the respective
advantages and dis-advantages pertaining thereto, in our opinion, the said
settlement had rightly not been made the basis for determining the market value
of the land.
The High Court, thus, was required to determine the fair market
value of the land on the basis of the legal principles laid down by this Court
in the decisions referred to heretobefore. No contention has been/ could be raised
that the High Court in passing the impugned judgment failed to take into
consideration the well settled legal principles.
There is another aspect of the matter which cannot also be lost
sight of. The High Court based its decision on its earlier common judgment
arising out of the same notification. The lead judgment was 11 delivered in the
case of Jia Ram and others vs. Union of India, - R.F.A. No. 500 of 1987.
We have not been informed whether any appeal has been preferred
against that judgment and if so, what was the result thereof. In absence of
that information, we are of the opinion that the appellants should not be
treated differently from Jia Ram (supra) who might not have preferred any
appeal and have accepted the judgment of the High Court.
For the reasons stated above, there is no merit in these appeals.
are dismissed accordingly. No costs.
......................................J. [ S.B. Sinha ]
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