Iyasamy & ANR. Vs.
Spl. Tahsildar, Land Acquisition  INSC 814 (30 September 2010)
IN THE SUPREME COURT
OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NOS. 1760-1761 OF 2004
IYASAMY & ANR. ....
SPL. TAHSILDAR, LAND ACQUISITION ...
Respondent WITH CIVIL
APPEAL NOS. 6875-6877 OF 2004 WITH CIVIL APPEAL NO. 7434 OF 2004
these appeals are arising out of the land acquisition proceeding in which various
notifications under Section 4(1) of the Land Acquisition Act, 1894 (hereinafter
referred to as "the Act") were issued in proximity of time, i.e. in
1981, with respect to adjoining lands in the Erode and Periasemur Villages for
the construction of houses for the scheme called "Erode West Neighbourhood
Scheme" and therefore we propose to decide them by a common judgment and
order. The Civil Appeal Nos. 1760-1761 are directed against final judgment and
order 2 dated 18-01-2001 passed by the Madras High Court in Appeal No.298/92
and CMP No. 15057/97 wherein the High Court by its impugned judgment partly
allowed the appeal filed by the Respondent and declined to condone the delay of
7 days in filing the Cross appeal by the appellants and consequently, dismissed
the CMP No. 15057/97. Consequent thereto, the cross-appeal of the Appellants
was also dismissed without going into merit.
The Civil Appeal No.
6875-6877/04 and 7434/04 are directed against the final judgment and order
dated 17/10/03 passed in A.S. Nos. 754/02, 759/02. 760/02 and 128/92 by the
Madras High Court whereby the High Court by its impugned judgment and order
dismissed the appeals filed by the appellants.
appellants were not satisfied with the compensation awarded by the Land Acquisition
Officer, so there were 12 LAOPs filed before the Reference Court. The Reference
Court enhanced the compensation and fixed it at the rate 3 of Rs. 6/- per sq.
ft. Both the appellants and respondent filed appeals before the High Court. The
High Court was pleased to remand back the appeals to the Reference Court except
A.S. No. 298/92.
A.S. No. 298/92, the appellants moved CMP No. 15057/97 to condone the delay of
7 days in filing the cross objection. The High Court dismissed the said
application. Consequently, the cross appeal of appellants was dismissed. As far
as the appeal filed by the respondent in A.S. no. 298/92 was concerned, the
High Court referred its judgment in A.S. No. 71/92 which was in reference to
the same scheme for the adjoining survey no. and in which the High Court
enhanced the market value to Rs. 9/- per sq. ft. and thereby the High Court in
its impugned judgment and order dated 18/1/2001 also enhanced the market value
of the land involved in A.S. No. 298/92 to Rs. 9/- per sq. ft., and deducted
33-1/3% towards development charges and ultimately the 4 compensation was
fixed at Rs. 6/- per sq. ft. The High Court also rejected the claim of interest
on solatium u/s 23 (2) and additional compensation u/s 23(1A) of the Act.
far as the matters remanded back are concerned, the Reference Court fixed
compensation at the rate of Rs. 6/- per sq. ft. after remand for the lands
involved in LAOP Nos. 4/87, 9/87, 19/87 and 25/87, against which A.S. No. 754/02,
759/02, 760/02 and 128/92 were made.
separate orders, the Reference Court in LAOP Nos. 22/87, 24/87, 26/87 and
410/00, which were matters involving neighbouring lands for the same housing
scheme and which were also remanded back by the High Court, fixed compensation
at the rate of Rs. 13-14/- per sq. ft., against which appeals were also filed.
All these appeals were decided by the High Court by judgment and order dated
17/10/03 whereby the High Court reduced the compensation of 13-14/- per sq. ft.
awarded in LAOP Nos. 5 22/87, 24/87, 26/87 and 410/00 by the Reference Court
to 6.25/- per sq. ft., while A.S. Nos. 754/02, 759/02, 760/02 and 128/92 were
dismissed upholding the compensation @ 6/- per sq. ft.
1. We have heard the
learned counsel appearing on behalf of the parties at length. The principal
issue that arises for our consideration is what would be the reasonable
compensation for the acquired lands in the present case.
The learned counsel
for Appellants contended before us that the Reference Court in LAOP Nos. 22/87,
24/87, 26/87 and 410/00 fixed compensation at the rate of Rs.
13-14/- per sq. ft.,
therefore, the appellants are also entitled to the same amount of compensation
and that the High Court by its impugned judgment and order dated 17/10/03 erroneously
fixed the market value @ Rs.6.25/- and 6/- by overlooking the evidence of sale
Ex. C15, C16 and C17)
which shows the market value of the adjoining lands at Rs. 19-20/- per sq. ft.
Further, the 6 learned counsel for appellants contended that the deduction of
1/3rd towards development charges is illegal and not sustainable.
1. We have considered
the evidence on record and appreciated the documents to determine the just and
fair market value of the acquired lands. The High Court by its impugned
judgment and order dated 17.10.2003 considered Exhibit C3 which is a sale deed
in which the sale of the adjoining land was made at the rate of Rs. 10/- per sq
ft. The evidence produced further proves that this land is on the Nasiyanur
Road and very near and almost adjacent to the land acquired. Therefore, this
piece of evidence is very valuable and dependable for determining the market
value in the present case.
However, this sale
deed pertains to a small portion of land i.e. one acre and four cents, while
the acquired land is a large tract of land.
1. The legal position
in this regard has been reiterated by this court time and again. It was held in
Smt.Kausalya Devi & Anr. reported at (1984) 2 SCC 324, (in paragraph 13)
that: - "Where large tracts of land are acquired, valuation in transaction
in regard to smaller properties does not offer a proper guideline and
therefore, cannot be taken a real basis for determining compensation.
For determining the
market value of a large property on the basis of a sale transaction for smaller
property a deduction should be given." Besides, in Kasturi & Ors. v.
State of Haryana reported at (2003) 1 SCC 354 it was held that (in paragraph
7):- "It is well settled that in respect of agricultural land or
undeveloped land which has potential value for housing or commercial purposes,
normally 1/3rd amount of compensation has to be deducted out of the amount of
compensation payable on the acquired land subject to certain variations 8
depending on its nature, location, extent of expenditure involved for
development and the area required for roads and other civic amenities to
develop the land so as to make the plots for residential or commercial
1. If we assess the
market value of the land acquired at Rs. 10/- per sq ft. on the basis of Ex. C3
and deduct 1/3 rd towards development charges, it comes approximately to Rs.
6.25 per sq ft. As far as Exs. 15, 16 and 17 are concerned, in those documents,
transaction were made at the rate 20/- per sq. ft. But the lands pertaining to
those sale deeds are highly developed and better located being situated right
on the Manickampalayam road not very far from the Mettur road, and the
Therefore, if a
deduction of 65% should be made as is done in some cases decided by this Court,
the valuation would come to Rs. 6.25/-. The aforesaid lands covered by the
three exhibits are land of better quality, and better location with better
connectivity. Besides, these are small pieces of land compared to a large tract
of land acquired in the present case. Therefore, a deduction of 65% of land
value appears to be just and appropriate. For quality and location of land, if
deduction is permissible at 1/3rd valuation and for smaller piece of land
pitted against large tract of land also another 1/3 rd deduction is
permissible, the same would again amount to valuation being fixed at Rs. 6/- or
Rs. 6.25/-. This amount of compensation was awarded by the High Court in
respect of acquired lands in LAOP Nos. 22/87, 24/87, 26/87 and 410/00. The
lands in LAOP Nos. 22/87, 24/87, 26/87 and 410/00 have an access to road which
connects Nasiyanur Road and Manickampalayam Road, however, such advantages are
not available to the land in the present case as the same are landlocked plots.
Therefore, we uphold
the compensation at the rate of Rs. 6/- per sq. ft. in respect of present lands
as awarded by the High Court.
1. There is also other
guidance available on record to determine the valuation in the form of various
awards with respect to acquisition of adjoining lands. These awards are
important piece of evidence for arriving at the market value acquired land in
view of the decision of this court in Mohammad Raofuddin vs. Land Acquisition
Officer reported at (2009) 14 SCC 367, wherein it was held that (paragraph 21):
- "....reliance on earlier judgment in respect of a land situated in the
same village, acquired only six months ago, could not be said to be an
irrelevant factor affecting the determination of market value/ compensation in
respect of the land of the appellant."
1. The High Court in
A.S. No. 875 of 1991 and cross- objection No. 253 of 1992 fixed the market
value at Rs. 6, 99, 934/- for one acre and ten cents, which works out to Rs.
6/- per sq. ft. The lands are situated in S.No. 147/1, Periasemur village
acquired for the same public purpose pursuant to notification under Section 4
of the Act dated 15.07.1981. Though the revenue village is different, 1 the
lands are located very adjacent and in the same locality having similar
facilities. Similarly in A.S. No. 137 of 1993 and the cross-objection No. 72 of
1994, the Division Bench of the High Court fixed the market value of the land
Rs. 5.53 per sq. ft. In this matter the land was covered by S.No. 145/1,2,3 and
4, Erode village acquired for the same Erode neighbourhood scheme by the
notification dated 5/1/1981, which is next to the present acquired land. In
A.S. No. 584 of 1986 in which adjoining land was acquired via notification
dated 14-3-1973, the division bench of the High Court fixed the market value
Rs. 5/- per sq. ft. Since all these awards have become final and binding,
therefore reliance could be placed on the same. Consequently, the reasonable
compensation and fair market value of the present acquired land should be Rs.
6/- per sq.ft.
1. The learned
counsel for Appellants in Civil Appeal Nos. 1760-1761/04 are also claiming
interest on solatium and additional compensation as the impugned order of the
High 1 Court was pronounced prior to judgment in Sunder v. Union of India
reported at (2001) 7 SCC 211. Since the present appeal was pending before this
court, therefore, the ratio of Sunder v. Union of India would entitle the
appellants to receive interest on solatium under section 23 (2) and additional
compensation under Section 23 (1A) in terms of the said decision. It was
decided in Gurpreet Singh v. Union of India reported at (2006) 8 SCC 457 that
such interest can be claimed only from the date of the judgment in Sunder
(supra) i.e. 19.9.2001. Therefore, the appellants in the Civil Appeal Nos.
1760-1761/04 shall be entitled to such interest for the period after 19.9.2001,
not the period prior to the same.
1. In view of the
aforesaid, we do not find any merit in these appeals to interfere with the
quantum of compensation awarded by the High Court and accordingly, dismiss the
Civil Appeal Nos. 6875-6877/04 and 7434/04. However, we partly allow the Civil
Appeal 1 Nos. 1760-1761/04 with respect to interest on solatium u/s 23(2) and
additional compensation u/s 23(1A) of the Act, which shall be guided by
observations and directions made in paragraph 11 above. The parties are left to
bear their own cost.